Press ReleasesOctober 05, 2006
Wallbridge Completes Acquisition of Broken Hammer and Parkin Resources from Xstrata Nickel
Toronto, Ontario -- October 5, 2006 -- Wallbridge Mining Company Limited (TSX: WM, FWB: WC7) today announced that it has concluded the restructuring of its 4X Joint Venture with Xstrata Nickel ("Xstrata"), formerly Falconbridge Limited thereby acquiring Xstrata Nickel's 36% interest in the Broken Hammer Resource on the Wisner Property, as well as the Parkin Offset Property. As a result of the restructuring, Wallbridge will have a 98.5% interest in both properties, with Falconbridge's 1.5% interest satisfied solely by a 1.5% Net Smelter Royalty payable on production from the properties.
In return, Xstrata Nickel will increase its interest to 50% in the Frost Lake Property, as well as the remainder of the Wisner Property, excluding the 6 claims surrounding the Broken Hammer Zone, subject to Xstrata Nickel retroactively funding its 50% share of the exploration expenditures incurred on these properties since January 1, 2005. Exploration on both of these properties will continue in Joint Venture with Xstrata with Wallbridge as Operator. Should Xstrata elect not to fund their share of expenditures on either of the two properties, their interest will be diluted in proportion to the unfunded expenditures.
The Broken Hammer Resource is a shallowly plunging surface zone of vein and vein stockwork hosted copper-PGE mineralization. An initial mineral resources estimate was completed by David Rennie, P.Geo. of Roscoe Postle Associates Inc. ("RPA") for the Broken Hammer Zone on the Wisner Property in November 2005. The total Inferred Mineral Resource as estimated by RPA to NI-43-101 standards, is 251,000 tonnes at a grade of 3.80 g TPM/t (1.56 g/t Pd, 1.62 g/t Pt, and 0.61 g/t Au), 1.00% copper (Cu), and 0.10% nickel (Ni). (For details see Press Release dated November 29, 2005).
An estimate of the mineral resource on the Parkin Offset property to NI 43-101 standards prepared in 2002 for Wallbridge by Alar Soever, P.Geo. of Watts, Griffis and McOuat, Consulting Geologists and Engineers ("WGM") reported Indicated Resources of 264,000 tonnes at a grade of 0.70% Cu, 0.65% Ni, 0.62 g Pt/t, 0.80 g Pd/t and 0.23 g Au/t and Inferred Resources of 87,000 tonnes at a grade of 0.65% Cu, 0.42% Ni, 1.17 g Pt/t, 1.07 g Pd/t and 0.55 g Au/t.
"We are very pleased to have reached this agreement with Xstrata, which benefits both companies" stated Alar Soever, President of Wallbridge. "Securing the resources at Broken Hammer and Parkin allows us to explore a variety of scenarios for advancing these two properties. In return, Xstrata gets the increased exposure to the excellent exploration potential on both the Frost Lake and Wisner properties that it desired. The fact that we were able to conclude these agreements, over the period which saw Xstrata take over Falconbridge, is a testament to the Falconbridge/Xstrata team. We welcome Xstrata to Sudbury and look forward to working with them to advance these properties."
Xstrata retains a right to buy back to a 60% interest at the feasibility stage in any deposit which contains in excess of US$750 million of contained metal by incurring 200% of Wallbridge's total expenditures made after January 1, 2005 . The following metal prices in US$ will be used to determine the contained metal value of the Reserve and Resources:
Nickel $4.50 per pound Copper $1.00 per pound Cobalt $15.00 per pound Platinum $700.00 per ounce Palladium $200.00 per ounce Gold $400.00 per ounce
Xstrata also has a one-time option to reacquire a 50% interest in the Broken Hammer and Parkin Properties if Commercial Production from the properties is not achieved within five years by funding work on the Property until it incurs 200% of Wallbridge's total Expenditures incurred after January 1, 2005. This provision is subject to Wallbridge being able to acquire the necessary permits to achieve Commercial Production, provided it is pursuing such permits diligently.
Xstrata also retains the right to process nickel ores from the properties at fair rates that take into account the cost structure and efficiencies of the designated facilities. For ores in which less than 33% of the contained metal value is contributed by nickel Wallbridge shall have the right to seek competitive bids for the processing of the ore, or to investigate the feasibility of partially or entirely processing the material itself. Xstrata retains the right of first refusal to process non-nickel ores by matching the terms available to Wallbridge.
Wallbridge Mining Company Limited explores for and develops nickel, copper and platinum group element ("PGE") deposits. The Company's principal properties are located in the Sudbury Basin in Ontario. The Sudbury area hosts the world's largest concentration of nickel deposits and is currently the most active mining camp in North America. Wallbridge also has a major shareholding in Duluth Metals Limited, which has a significant property position in the rapidly emerging Duluth Complex base metal camp in Minnesota.
For Further Information
Please visit the Company's website at www.wallbridgemining.com, or contact:
Wallbridge Mining Company Limited
Alar Soever, President
Tel: (705) 682-9297
Email: [email protected]
CHF Investor Relations
Mara Strazdins, B.Sc.Geo., Vice President
Tel: (416) 868-1079 ext. 222
Email: [email protected]
This document may contain forward-looking statements relating to Wallbridge's operations or to the environment in which it operates. Such statements are based on operations, estimates, forecasts and projections. They are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and may be beyond Wallbridge's control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in forward-looking statements, including those set forth in other public filings. In addition, such statements relate to the date on which they are made. Consequently, undue reliance should not be placed on such forward-looking statements. Wallbridge disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, save and except as may be required by applicable securities laws.