VANCOUVER, May 1, 2012 /PRNewswire/ – Red Eagle Mining Corporation (TSX-V: RD) (OTCQX: RDEMF), is pleased to announce that it has entered into a final agreement pursuant to which it has acquired an option to purchase 100% of the Mina Vieja past producing copper/gold mine.
Mina Vieja covers 952 hectares and lies on a 15km long northeast trending system of skarn formation containing mineralization of copper, gold, silver and zinc. This district contains a number of historical workings and mineralised outcrops. A mapping, trenching and channel sampling program is well underway with core drilling commencing in May.
“Finalising the Mina Vieja option is a significant step to meeting our objective of consolidating the Pavo Real district”, comments Ian Slater, Chief Executive Officer. “A copper/gold concentrate was historically produced at Mina Vieja from high grade ore. However, the mine was abandoned early in its life in the 1970s due to declining copper prices.”
Mina Vieja is conveniently located near high voltage power and a major new highway, providing easy access by road from both, Red Eagle Mining’s project office in the town of Rovira and the Tolima Department capital of Ibague. The Pavo Real project covers a 15km by 20km area consisting of 100% owned concessions, the Mina Vieja Option and a joint-venture with Miranda Gold Corp. (TSX-V: MAD) which Red Eagle Mining is currently earning-in to 70%.
Red Eagle Mining, through its wholly-owned subsidiary, Red Eagle Mining De Colombia Limited (“REMDC“) has acquired an option to acquire 100% of a mining exploitation license and a mining concession agreement in consideration of the following cash payments:
| Upon signing (paid) || || || || || || US $5,000 |
| Each month for 6 months from the Effective Date || || || || || || US $5,000 |
| 6 months from the Effective Date || || || || || || US $100,000 |
| 18 months from the Effective Date || || || || || || US $200,000 |
| 30 months from the Effective Date || || || || || || US $200,000 |
The option payments are only payable once the last resolution is filed with the National Mining Registry transferring title to REMDC (“Effective Date“). Once the option payments have been made, REMDC may exercise the Option at any time within 90 days of the publication of the initial NI 43-101 resource report for cash consideration of an amount equal to US $11 per ounce of gold equivalent measured resource included in the initial report. There are no minimum exploration commitments or timing deadlines.