Canarc Options 9 Mexican Properties to Far West Mining Ltd.
Vancouver, British Columbia, Canada,
February 18, 1999
Canarc Resource Corp. is pleased to announce that its 75% owned subsidiary company Aztec Silver Corporation, has concluded an option agreement on 9 properties ( Lobos 4, 9, 10, 14 -19) covering 485,949 hectares in central Mexico with Far West Mining Ltd. The agreement calls for Far West to spend US$5.5 million on work expenditures make US$500,000 in cash payments and issue 1 million shares (subject to regulatory approval) to Aztec Silver over a 3-year term to earn a 50% interest in the properties.
The expenditures will cover an airborne electromagnetic and magnetic geophysical survey, follow-up ground geophysics, geochemistry and geology plus two phases of drilling. The airborne work is scheduled to start in March and the Phase 1 drilling program in September.
As previously announced, Aztec Silver has also optioned 3 additional properties (Lobo 6-8) in the same area to Noranda Minerals. Noranda can earn up to 70% in Lobo 6 and 8 and up to 100%(subject to a 3% NSR) in Lobo 7 by making a series of cash payments totaling US$1.1 million, funding the properties to final feasibility and making a series of share purchases totaling US$3.5 million at share prices from CAD$1 to $6. Noranda's exploration program is now underway.
Last year, Aztec Silver staked a total of 13 properties in the states of Zacatecas and San Luis Potosi based upon a compilation of geological, geochemical and geophysical data. By combining that data with an evaluation of the known deposits in the area, Aztec established several attractive targets for staking.
Zacatecas and San Luis Potosi states have a prolific silver mining history starting in the 1500's with the Spanish. The hills have been intensely prospected through the years, which resulted in the discovery of many surficial mineral deposits. Recent blind discoveries of buried deposits such as Francisco I Madero, a sedex deposit with a published resource of 35 million tonnes and San Nicolas, a volcanogenic massive sulphide deposit with a published resource of 85 million tonnes, have sparked renewed activity in the area. Aztec recognized the potential to discover similar world class mineral deposits in the vast desert valleys, where the depth to bedrock can be as little as 3 meters.
The area has many rich silver deposits, including the Zacatecas vein mining camp, which has produced 1 billion ounces of silver. The Fresnillo vein and manto mine has produced half a billion ounces of silver, and has the potential to produce another billion ounces of silver. The San Martin-Sabinas polymetallic vein and skarn mines have combined production, reserves and resources totaling 70 million tonnes.
Stated Godfrey Walton, Vice-President for Canarc that "These previously known deposits all outcropped on hillsides. The newly discovered buried deposits, San Nicolas and Francisco I Madero support the premise that there is tremendous potential in the district for the discovery of traditional deposit styles (skarns, mantos, chimneys and veins) and new deposit styles (sedex and volcanogenic) beneath the valley fill."
The targets being explored by Aztec and Far West are skarn, manto, chimney and vein systems associated with Tertiary felsic intrusions, which have been emplaced into Cretaceous limestones and shales as well as sedex and volcanogenic massive sulphide deposits hosted in the Cretaceous volcanic rocks. The regional aeromagnetic data that Aztec has reprocessed highlights areas where the intrusions do not appear to outcrop. These intrusion related magnetic anomalies coincide with numerous mineral showings, which are typically peripheral to the skarn, vein, manto and chimney deposits. Aztec and Far West share the view that there is potential for multiple blind discoveries on the Lobo properties.
Canarc Resource Corp. is a growth-oriented, international gold exploration and mining company. Production increased 36% last year to 9500 oz. at the Company's Sara Kreek (80%) mine . Reserves and resources now total 2 million oz. at the New Polaris (100%) and Bellavista (18%) projects. Our large exploration portfolio includes joint ventures with Homestake and Noranda. Major shareholders include Barrick Gold and Echo Bay Mines. The Company's common shares trade under the symbol "CCM" on the Toronto Stock Exchange.
For further information contact Robert Carriere, Investor Relations at (604) 685-9700 or visit our website:www.canarc.net.
ON BEHALF OF THE BOARD OF DIRECTORS
CANARC RESOURCE CORP.
Bradford J. Cooke
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