June 29, 2011 TSX Venture Exchange
Canadian Trading Symbol: CTR
Coltstar Ventures Inc. (CTR – TSX Venture), is pleased to announce that it has signed an option agreement to earn a 70% interest in the Palm Springs Gold Property (the “Property”) located within the “Golden Triangle” region in northern British Columbia, approximately 80 kilometres north of Stewart.
The Property displays many of the unique geological characteristics specific to Barrick’s famous Eskay Creek deposit six (6) kilometres away. The Eskay Creek Mine, was Canada’s highest-grade gold mine (average grade 48.4 grams per tonne gold) and the world’s fifth largest silver producer having produced approximately 3.5 million ounces of gold and 176.4 million ounces of silver between 1994 and 2008.
Furthermore, it is 30 kilometres from several other world class “Golden Triangle” deposits, namely KMS (Kerr Mitchell Sulphurets), Snowfield and Brucejack.
“The acquisition of the Palm Springs Gold Project builds on our existing portfolio of quality early-stage Canadian mineral projects,” said Damien Reynolds, Chairman and CEO. “Having Dave DuPre on the team gives us first-hand knowledge of the Eskay area. This is a unique advantage that greatly reduces our learning time. We are going to support him in his efforts to quickly identify another Eskay-type orebody.”
Rationale for Acquisition
Coltstar Director and Chief Geologist, Mr. David DuPre, supervised the 1988 drilling program that discovered the renowned, world-class, Eskay Creek mine. As President of Keewatin Engineering (exploration consulting and contracting firm), Mr. DuPre also supervised dozens of projects throughout the Golden Triangle. Fortunately, one of these projects covers the present-day Palm Springs property.
This unique experience, as well as a review of the regional and Property geology, has led him to conclude that the property is partially underlain by the Middle unit of the Pillow Basalt Ridge formation with potential to form and preserve Eskay Creek-style mineralization. The geological setting of the Eskay Creek and Palm Springs properties is very unique (and similar) and not widely represented throughout the area due to erosion.
This conclusion is supported by the following field observations:
* Bulk stream geochemical sampling on the property by the British Columbia Geological Survey returned values up to 177 grains of gold in one sediment sample. The second highest gold value in the area, only exceeded by a sediment sample from the immediate Eskay Creek area;
* A number of rock grab and trench chip samples, previously taken from the property, display anomalous disseminated pyrite, blebs of galena and chalcopyrite;
* Eskay pathfinder elements such as arsenic, mercury and antimony were observed during previous exploration;
* Rhyolitic volcanics have been identified and are overlain by black siltstones and volcaniclastics. An old trench exposed approximately 8m of dacitic, tuffaceous, well bedded, felsic volcanics with overlying sediments. Up to 20% disseminated pyrite mineralization was noted within the felsic volcanic; and
* Basaltic cap rocks are also still present.
“The Palm Springs Gold property displays all of the distinctive features that were present at the Eskay Creek Mine. Coltstar’s near-term efforts will be directed toward discovering an Eskay-like gold-silver deposit through geochemistry, geological mapping (with a special emphasis on discerning the stratigraphy) and ground geophysics”, says Mr. Dupre.
The May 6, 2011, announcement by the federal government granting the BC Hydro Northwest Transmission Line Project environmental approval, and the agreements reached with all strategic stakeholders, means the Golden Triangle region in northern British Columbia will finally receive sufficient power, by the end of 2013, to enable the opening of a significant number of mines.
Terms of Option Agreement
Under the option agreement, Coltstar can earn a 70% interest in the Project by making $3,000,000 in exploration expenditures, issuing 2 million shares, and making option payments totaling $300,000, over a 4-year period. Once the 70% interest is earned, a joint venture is formed between Coltstar and the Optionor, with ongoing project costs paid for by the partners on a pro-rata basis. Any partner whose interest falls below 10% is automatically converted into a royalty interest, one half of which can be purchased by the other partner
The transaction is subject to regulatory approvals.
Coltstar Ventures Inc. is a mineral exploration company that is currently exploring for base and precious metals in northwestern Canada and Italy. Mr. David DuPre, a director of Coltstar, is a Qualified Person under the guidelines of National Instrument 43-101, and has reviewed and approved the geological information contained in this news release.
On behalf of the Board of Directors
Chairman, President and CEO of Coltstar Ventures Inc.
For further information please contact:
Stephen Burega, Corporate Development
Telephone: (604) 683-8236 ext 224
Coltstar Ventures Inc.
Suite 1680, 200 Burrard Street
Canada V6C 3L6
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.