UPDATE ON AGREEMENT WITH GLOBAL COPPER CORP.
January 25, 2007
Vancouver, British Columbia. GHGResources Limited (GHG”) is pleased to provide an update with respect to the previously announced agreement (the "Option") GHG entered into with Global Copper Corp (“Global”) for an option on all of Global’s indirect interest in the Vizcachitas property. GHG and Global have agreed to extend the closing date of the transaction to January 31, 2007, in order to allow for the completion of final documentation.
Pursuant to the Option, GHG has the right to purchase all of the issued and outstanding shares of Vizcachitas Limited. Vizcachitas Limited and another wholly owned subsidiary of Global own all of the issued and outstanding shares in Compañía Minera Vizcachitas Holding ("CMV"). CMV owns the following interests which comprise the Vizcachitas Property:
The Property is located in the province of San Felipe, Region V, Chile, an area of low elevation with excellent infrastructure, including water and power. A.C.A. Howe International Limited described NI43-101 compliant mineral resources for the Property in a technical report dated June 29, 2006. The resource calculation was based on 68 drill holes for a total of 18,300 metres. Results showed an indicated resource of 144 million tonnes grading 0.53% copper and 0.015% molybdenum and an inferred resource of 211 million tonnes grading 0.46% copper and 0.016% molybdenum at a 0.40% copper cutoff.
San José SLM is a Chilean Sociedad Legal Minera ("SLM") and on closing of the transaction GHG will own an indirect 51% majority interest in San Jose SLM. This SLM provides ownership of an important central zone of the existing mineralization of the Vizcachitas property.Chilean legal counsel have advised that a Chilean Sociedad Legal Minera, or SLM, is regulated by the Chilean Mining Code (the "Code"), according to which (i) the administrators to represent the SLM are appointed in shareholders meetings, who will then have the power to administer the SLM, including entering into labour contracts, buying materials necessary for the exploration or exploitation of the mine or processing of the mine's products, paying debts and collecting credits of the SLM and selling ore extracted from the SLM's properties; (ii) all other matters not entrusted by the Code to the administratorare decided in shareholders' meetings, which are presided over by the shareholder with the highest number of shares; (iii) in most cases matters are decided by the majority of the shares, including the determination of the amount of contributions for expenses of maintenance and exploration or exploitation of the concessions (the "Expenses"); and(iv) the shareholders are required to contribute to the payment of the Expenses in proportion to the shares they hold in the SLM.
GHG understands a single Chilean company (“Minority Shareholder”) owns the remaining minority 49% of San José SLM. GHG has not yet determined how development of the Property will proceed and understands that the shareholders and principals of the Minority Shareholder do not plan to cooperate with GHG. Nevertheless GHG looks forward to meeting with the shareholders and principals of the Minority Shareholder to determine if a mutually beneficial plan of action may be developed. GHG is advised that the Code provides remedies for resolution of disputes in connection with development plans of such mineral resources.
The property rights outlined in points 2 and 3 above hold title to the balance of the mineralization, and the surrounding area, part of which hold important potential for expanding or adding to the existing resource at the Property, and at a minimum provide for critical waste stripping and development tenure for the identified resource to date. Initial work programs at the Property will in part focus on testing the potential of these areas to host extensions or additions to the existing mineralization, with a view to further enhancing the economics of the Property.
ON BEHALF OF THE BOARD
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
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