|Mon Nov 8, 2004|
Helio Signs Letter of Agreement On The Lokgwabe Diamond Project, Botswana
|Helio Resource Corp. ("Helio") is pleased to announce that it has signed a Letter of Agreement ("LOA") with Jatinga (Proprietary) Limited ("Jatinga") of Botswana regarding its three Lokgwabe diamond licenses in Botswana, southern Africa (map attached).|
The Lokgwabe licenses are located to the west of Kang and cover an area measuring 3,000km2, of which 1,100km2 has been sampled on a 1km x 1km density. De Beers explored the north-eastern portion of the license area in the late 1980s / early 1990s, conducting airborne magnetics and soil sampling for kimberlite indicator minerals ("KIMs"). Follow-up sampling and limited diamond drilling on certain geophysical and KIM targets did not locate kimberlite and De Beers halted its exploration programme in the vicinity.
Between 1994 and 1998 Menora Resources Inc. explored the area of the licences and expanded on the work done by De Beers, locating multiple new KIM targets to the south west of the De Beers grids. Menora collected a total of 1,053 samples, of which 210 samples were found to contain KIMs, and identified 5 areas / clusters of KIMs.
Analysis of 232 garnets from the project area undertaken previously show that six garnets plot within the G10 garnet field, and a further six garnets plot on or adjacent to the G9 / G10 garnet boundary. The G10 garnets were recovered from three of the five KIM clusters. The presence of G10 garnets is very significant since they originate from within the diamond stability field of the earth's mantle. The surface textures of sixty-four KIM grains were also studied, four of which exhibited sub-kelyphytic textures, suggesting that the bedrock source(s) for the grains is nearby.
An airborne magnetic survey (using N-S flight lines 250m apart with 85m mean terrain clearance) was flown over the eastern part of the project area. A total of 18 possible diatreme features have been identified from the magnetic survey within the licenses. Five of the magnetic anomalies show good correlation with KIM anomalies, and four of the magnetic anomalies occur in areas untested by soil sampling. In addition, the major KIM anomaly lies outside the area of magnetic coverage. None of these anomalies have been tested by drilling.
The LOA provides Helio with the right and option to earn a 100% interest in the project by spending approximately C$300,000 (Botswana Pula BP1,100,000) before June 30, 2007. Helio paid Jatinga BP 45,000 (approx. C$12,000) to cover the cost of acquiring the three licenses. The LOA is an arms length transaction.
If and when Helio completes the earn-in requirements, Jatinga will retain a 3% Net Smelter Royalty ("NSR"). Helio will have the right to purchase two thirds of the NSR by paying Jatinga US$2,000,000 (US$1,000,000 per percentage point), leaving Jatinga with a 1% NSR. Helio has the right of first refusal on the 1% NSR should Jatinga wish to sell it.
Helio plans to seek partners to conduct further sampling to better define the extensive SW-trending KIM anomalies where they are open and also conduct detailed ground magnetics over the coincident KIM / airborne magnetic anomalies to better define drill targets.
For additional information, please contact Richard Williams at (604) 240 8945 or by email at email@example.com
ON BEHALF OF THE BOARD OF DIRECTORS,
"Richard D. Williams"
Richard D. Williams, P.Geo
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
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