TORONTO, Oct. 10, 2014 (GLOBE NEWSWIRE) -- Goldspike Exploration Inc. ("Goldspike" or the "Company") (TSX-V:GSE) announces it has signed a lease with an option-to-purchase agreement with Bravada Gold Corporation ("Bravada") to acquire a 100% interest in their South Lone Mountain property (the "Property"), located along the Battle Mountain-Eureka Gold trend in central Nevada. Goldspike controls the larger adjacent property position known as its Lone Mountain Zinc project.
This acquisition increases the Company's land position at the Lone Mountain property to more than 4,000 acres.
The South Lone Mountain property of Bravada consists of 28 unpatented mineral claims. In total Goldspike now controls 217 claims at Lone Mountain near Eureka, Nevada.
The newly acquired claims cover the northwesterly extension of a strong zinc soil geochemical anomaly that extends for more than 1,000 metres from a high grade zinc and lead drill hole intersection on the Lone Mountain Zinc property held by Goldspike (press release June 28, 2014). Goldspike has completed initial work on its property and expects to begin drill testing the area of the 2007 high grade zinc intersection this month.
Bruce Durham, President and CEO of Goldspike commented, "We are very pleased to have secured the Bravada claims because they add significant potential to the Lone Mountain project. We now control all but one claim in the entire area and will move quickly to evaluate the area for zinc and precious metals."
Portions of the Property cover the northwesterly extension of a strong zinc soil geochemical anomaly that extends for more than 1,000 metres from a high grade zinc and lead drill hole intersection on the Company's Lone Mountain Zinc property (Goldspike press release June 24, 2014).
The Agreement provides Goldspike with the option to earn a 100% interest in the Property by making staged, escalating lease payments totalling US$325,000 in cash over a period of up to 10 years, during which exploration and development on the Property may be conducted by the Company. In addition, Bravada will receive 50,000 Goldspike common shares upon receipt of TSX Venture Exchange approval and another 100,000 Goldspike common shares in the event a NI-43-101 combined resource estimate for the Company's Lone Mountain Zinc property and the Property indicates that at least 10% of the reported tonnage is attributable to the Property. All lease payments can be applied to the final purchase price of US$325,000, after which advance minimum royalty payments become due annually in the amount of the cash equivalent of 50 ounces of gold.
Bravada and a previous owner of the Property have royalties on production from the Property. Bravada holds a 1.5% NSR on base metals production and a 3% NSR on precious metals production. Bravada's base metal NSR can be reduced to 1.0% and its precious metals NSR can be reduced to 1.5% concurrently, not individually, by Goldspike for a total cash payment to Bravada of US $3,000,000. The previous owner of the Property holds a 1% NSR on both base and precious metal production from the Property. Goldspike can concurrently, not individually, buy down the royalty on both base and precious metals to 0.5% for total cash consideration of US $3,000,000.
Bravada President Joe Kizis commented, "The South Lone Mountain property is not a core asset for Bravada, however, we recognize the property's potential to host significant Mississippi-Valley-Type (MVT) zinc/lead/silver, as well as Carlin-type gold. Goldspike's control of adjacent MVT mineralization at the historic Lone Mountain Zinc mine makes them an ideal partner to further explore and develop the South Lone Mountain property."
Bruce Durham P.Geo, is a qualified person as that term is defined by National Instrument 43-101 on behalf of the Company and is the person responsible for the preparation of this release.
For further information contact:
Goldspike Exploration Inc.
Suite 1500 - 4 King St. W.
Toronto, Ontario M5X 1C9
Tel: 416-504-8821
Bruce Durham, President and CEO
bdurham@goldspike.ca
Neither the 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.
This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.