|February 27, 2013|
Zimtu Capital Corp. Announces Transaction with Pistol Bay Mining Inc. for Portland Graphite Property in Ontario
|Zimtu Capital Corp. (TSXv: ZC; FSE: ZCT1) (the "Company" or "Zimtu") is pleased to announce that the Company and one of its prospecting partners have signed an agreement with Pistol Bay Mining Inc. (TSXv: PST) ("Pistol Bay") whereby Pistol Bay can earn a 100%-interest in the advanced stage Portland Graphite Property located in southern Ontario.|
Portland Graphite Property, Ontario
The Portland Graphite Property (the "Property") is situated 1.6 km north of Highway 15 between Kingston and Ottawa. It is road-accessible and consists of private lands covering approximately 429 hectares, located 5.5 km northeast of the community of Portland, Ontario. Power and water are available on-site and rail access is nearby.
Graphite on the Property is hosted primarily in Precambrian marbles of the Grenville Province. Ontario government geologists reported in the 1960s that the graphite occurs as disseminated flakes averaging 1/8 inch in diameter. Work on the Property by previous operator Victoria Graphite Inc., including 73 drill holes (5,884m), identified graphite mineralization in three zones (D-zone, G-zone and I-zone) over a total strike length of 1700m. Mineralization dips at approximately 70 degrees to the west. In general, the zones are characterized by broad envelopes of lower-grade graphite mineralization with widths up to 75m, within which are zones of higher grade material, to >10% graphitic carbon ("Cg"), based on the diamond drilling by Victoria Graphite in the late 1980s.
Victoria Graphite also carried out test mining and milling utilizing a 100 tonne per day pilot plant in the early 1990s. Results of this test milling work are not available to the Company at this time. The mill building is still present and represents a potentially significant asset to Pistol Bay in terms of the ongoing development of the Property.
A historical "probable reserve" of 295,000 tonnes grading "slightly above 6% graphite" was delineated on the property. This estimate is a historical estimate prepared by R.A. Elliot for Victoria Graphite in 1989. Although it appears to have been done in a professional manner by the standards of the time, it does not conform to the standards of NI 43-101. The category "probable reserve" appears to conform most closely to the currently accepted category of "Inferred Mineral Resource". A program of re-logging, resampling and re-assaying of drill core would be required to bring the estimate up to 43-101 compliance. A qualified person has not done sufficient work to classify the historical estimate as a current mineral resource or mineral reserve. Pistol Bay is not treating the historical estimate as a current mineral resource or mineral reserve.
In terms of the quality of the graphite material, metallurgical testing on a 34 tonne sample of material from the D-zone was carried out in 1989 by Lakefield Research Ltd on behalf of Victoria Graphite. This work indicated recoveries of 87 to 95% of the graphite for material ground to -10 mesh. Flotation concentrates grading 80 to 85% Cg were produced which could be upgraded to 91-93% Cg by heavy liquid separation. Of particular note, this work indicated a coarse flake (+48 mesh or 0.325mm) content of 66% in the concentrate (Ontario Geological Survey, Open File Report 5729, 1990).
A detailed helicopter EM/magnetic survey over the Property is planned by Pistol Bay in order to establish geologic controls on mineralization, to better define the known graphite zones, and to identify new drill targets outside of the main zones. Trenching and diamond core drilling will support the development of an initial NI 43-101 compliant resource. Resource definition and exploration work will be complemented with metallurgical test-work.
For its participation in the transaction, Zimtu will receive cash/share payments from Pistol Bay as follows: (i) 1,000,000 common shares on acceptance by the TSX Venture Exchange ("TSXv"); (ii) $75,000 cash 6 months from the date of TSXv acceptance (iii) 750,000 common shares 12 months from the date of TSXv acceptance; (iv) 1,000,000 common shares 24 months from the date of TSXv acceptance. Zimtu will also receive a 1,000,000 common share break fee should Pistol Bay not make certain option payments to the underlying landowners or if the agreement is terminated prior to TSXv acceptance. Zimtu's prospecting partner will receive cash/share consideration equal to that of Zimtu.
The optioned claims were acquired by the Company and its partner by option from private landowners. Zimtu, along with its prospecting partners, continue to evaluate and acquire prospective resource properties to make available for sale or joint venture. As part of the Company's business, Zimtu provides mineral property advisory services and helps to connect companies with mineral properties of interest.
Technical information in this news release has been reviewed by William Brereton P. Eng of MPH Consulting Limited, Toronto, and a Qualified Person under the definition of National Instrument 43-101.
On Behalf of the Board of Directors
ZIMTU CAPITAL CORP.
President & Director
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-looking statements in this news release include that Pistol Bay can earn a 100%-interest in the Portland Graphite Property; that in consideration for its interest, Zimtu will receive staged cash/share payments from Pistol Bay, that Zimtu will also receive a 1,000,000 common share break fee should Pistol Bay not make certain underlying option payments or if the agreement is terminated prior to TSXv acceptance; that Zimtu's partner will receive cash and share consideration equal to that of Zimtu; that a detailed helicopter EM/magnetic survey over the Property is planned by Pistol Bay in order to establish geologic controls on mineralization, to better define the known graphite zones, and to identify new drill targets outside of the main zones; that trenching and diamond core drilling by Pistol Bay will support the development of an initial NI 43-101 compliant resource; that resource definition and exploration work by Pistol Bay will be complemented with metallurgical test-work; and that Zimtu with the support of its prospecting partners will continue to evaluate and acquire prospective resource properties to make available for sale or joint venture.
It is important to note that actual outcomes and the Company's actual results could differ materially from those in such forward-looking statements. Risks and uncertainties include, but are not limited to, economic, competitive, governmental, environmental and technological factors that may affect the Company's operations, markets, products and prices. Readers should refer to the risk disclosures outlined in the Company's Management Discussion and Analysis of its audited financial statements filed with the British Columbia Securities Commission.
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