Vancouver, British Columbia--(Newsfile Corp. - July 18, 2017) - American CuMo Mining Corporation (TSXV: MLY) (OTC Pink: MLYCF) ("CuMoCo" or the "Company") announces that it and its wholly-owned subsidiary, Idaho CuMo Mining Corporation ("Idaho CuMo") have executed a mining claims purchase agreement (the "Purchase Agreement") with CuMo Molybdenum Mining Inc. ("CuMo Molybdenum"), Western Geoscience Inc. ("Western Geoscience") and Thomas Evans pursuant to which CuMoCo and Idaho CuMo are to acquire from CuMo Molybdenum and Western Geoscience a 100% interest in the CuMo Project mining claims (the "Claims"). The Claims are currently subject to the terms of an option agreement between CuMoCo and CuMo Molybdenum dated October 13, 2004, and amended on January 14, 2005 (the "Option Agreement").
"Executing this mining claims purchase agreement represents a significant milestone and achievement for CuMoCo. Owning 100% interest in the CuMo Project means no longer having to make ongoing payments or pay expensive royalties, allowing the Company to proceed with developing CuMo unencumbered by option agreements and significantly increasing the value of our project", said Shaun Dykes, President and CEO of CuMoCo.
The Claims are unpatented and located in Sections 17 & 18, T8N; R6E in Boise County, Idaho. Certain of the unpatented claims are held in name by Western Geoscience (the "Western Geoscience Claims"), which corporation is controlled by Thomas Evans, and consequently, both entities have been added as parties to the Purchase Agreement. The Option Agreement contained an "area of interest" provision pursuant to which the Western Geoscience Claims became part of the Property.
Under the Option Agreement, the Company granted CuMo Molybdenum a 1.5% Net Smelter Return Royalty ("NSR") interest to a maximum of US$3,000,000 and thereafter a 0.5% NSR in respect of the CuMo Project, and the NSR is to be transferred by CuMo Molybdenum to CuMoCo pursuant to the Purchase Agreement.
The consideration payable for the assigning of all rights and ownership of the Claims to Idaho CuMo and the NSR to CuMoCo is as follows: upon the closing date of the agreement, the sum of US$500,000 in cash, a 7-year term silver convertible debenture in the aggregate principal amount of US$1,000,000 bearing an interest rate of 8.5% per annum and 2.5 million common shares of CuMoCo. Closing of the Transaction is subject to receipt of TSX Venture Exchange approval.
The Company also announces that drilling started last week on its Calida Gold project and to date, the first two holes have been completed and reviewed by the on-site geological personnel. The third hole is well under way and is being drilled from same pad to intersect the zone 30.5 meters (100 feet) to the west of holes one and two. The first hole (C17-01) was drilled into the main vein at a dip of 45 degrees and intersected a 20.4 meter (67 feet) wide mineralized zone between 50.6 (166 feet) and 71 meters (233 feet) that contained visible chalcopyrite. The location intersected matches that which was predicted by the 3D model of historic drilling. The second hole (C17-02) intersected two zones with the thickest between 93.6 (307 feet) and 105.2 meters (345 feet) at a depth of approximately 30.5 meters (100 feet) below the intersection obtained in the first hole.
The core is currently being logged in detail and samples will be sent for assay. Results will be made available as soon as they are received. A total of 60 to 70 holes is planned for the project this year.
Mr. Shaun M. Dykes, M.Sc. (Eng), P.Geo., President and CEO of the Company, is the designated qualified person for the CuMo Project and the Calida Gold project and he prepared the technical information contained in this news release.
About CuMoCo
CuMoCo is focused on advancing its CuMo Project towards feasibility. CuMoCo is also advancing its newly-acquired Calida Gold project. Management is continuing to build an even stronger foundation from which to move the Company and its projects forward. For more information, please visit www.cumoco.com, www.idahocumo.com and www.cumoproject.com.
