LAS VEGAS, NEVADA--(Marketwire -02/17/12)- North Springs Resources Corp. (OTC.BB: NSRS.OB - News)(Pinksheets: NSRS.OB - News) (the "Company" or "North Springs") is pleased to announce that it has entered into a Letter of Intent with a private third-party vendor to acquire a 10% interest in an option on four producing gold properties and a new milling facility to be built in Chihuahua, Mexico. In the aggregate, the four producing properties are believed to host an estimated inferred gold resource in excess of 1,000,000 ounces, as outlined in recent technical reports.
In addition to the four producing gold properties, the contemplated transaction includes a 10% interest in a new milling facility to be built in the same area. Previously, an interest in an existing mill was to be included in this transaction, but after careful consideration the parties have agreed that building out a new mill would best serve the partnership. The new mill will be located closer to the four producing gold properties and have greater dedicated capacity, which should lower shipping costs, shorten processing times, and improve overall operating margins. The new mill could also generate significant toll-milling revenue for the Company and its partners.
"This potential acquisition is shaping up to be our largest and most important one yet. The opportunity to purchase a relatively large interest in a one million plus ounce operating gold mine is the type of transaction that, if successful, could form the foundation of this company for many years to come," stated Harry Lappa, President of North Springs. "All parties involved in the potential transaction are committed to quickly concluding their due diligence and negotiating final terms for a Definitive Agreement. We anticipate releasing additional detailed information about the transaction and the properties sometime next week."
The state of Chihuahua has a long history of gold, silver, copper, mercury, lead, and coal production. The Sierra Madre Occidental (SMO) mountain range runs north to south through the western portion of the state and is host to a prolific trend several hundred miles in length with significant past mineral production and important recent discoveries. Gold and silver mines of region are among the richest in Mexico, and include the famous mining districts of Batopilas, Chihuahuilla, Cosihuiriachic, Jesus Maria, Parral, and Santa Eulalia or Chihuahua el Viejo.
In 2010, Chihuahua was the second leading gold producing state in Mexico, accounting for 23% of total gold production. It is estimated that over the past 400 years, this region of Mexico has produced over 40 million oz. of gold and up to 2 billion oz. of silver. Several of the top producing gold mines in Mexico are located in Chihuahua, including the Ocampo Mine (AuRico Gold - 99,500 oz. of gold and 4.2 million oz. of silver in 2011) and the El Sauzal Mine (Goldcorp - 100,500 oz. of gold in 2011).
The previously announced negotiations to acquire additional gold properties in the United States have been terminated. The Company will now focus its attention on completing this transaction as quickly as possible.
This potential acquisition remains subject to, among other things, North Springs and the current option holders concluding negotiations, completion of satisfactory due diligence, and the execution of a definitive agreement. There can be no assurance that any transaction will be completed.
Further updates regarding this proposed transaction and other North Springs projects will be made as additional information becomes available.
About North Springs Resources Corp.
North Springs Resources Corp. is focused on the evaluation, acquisition, exploration, and development of mineral resource properties. The Company is led by a skilled and experienced management team and independent consulting geologists with many years of experience. North Springs is committed to creating value for its shareholders by advancing its current holdings and by acquiring new properties with significant potential.
For additional information, please visit www.northspringsresources.com.
Harry Lappa, President
THIS NEWS RELEASE CONTAINS "FORWARD-LOOKING STATEMENTS", AS THAT TERM IS DEFINED IN SECTION 27A OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE UNITED STATES SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. STATEMENTS IN THIS NEWS RELEASE, WHICH ARE NOT PURELY HISTORICAL, ARE FORWARD-LOOKING STATEMENTS AND INCLUDE ANY STATEMENTS REGARDING BELIEFS, PLANS, EXPECTATIONS OR INTENTIONS REGARDING THE FUTURE. EXCEPT FOR THE HISTORICAL INFORMATION PRESENTED HEREIN, MATTERS DISCUSSED IN THIS NEWS RELEASE CONTAIN FORWARD-LOOKING STATEMENTS THAT ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH STATEMENTS. STATEMENTS THAT ARE NOT HISTORICAL FACTS, INCLUDING STATEMENTS THAT ARE PRECEDED BY, FOLLOWED BY, OR THAT INCLUDE SUCH WORDS AS "ESTIMATE," "ANTICIPATE," "BELIEVE," "PLAN" OR "EXPECT" OR SIMILAR STATEMENTS ARE FORWARD-LOOKING STATEMENTS. RISKS AND UNCERTAINTIES FOR THE COMPANY INCLUDE, BUT ARE NOT LIMITED TO, THE RISKS ASSOCIATED WITH NATURAL RESOURCE EXPLORATION AND DEVELOPMENT AND NEEDS FOR FUNDING AS WELL AS THE RISKS SHOWN IN THE COMPANY'S MOST RECENT ANNUAL REPORT ON FORM 10-K AND ON FORM 10-Q AND FROM TIME-TO-TIME IN OTHER PUBLICLY AVAILABLE INFORMATION REGARDING THE COMPANY. OTHER RISKS INCLUDE RISKS ASSOCIATED WITH THE REGULATORY APPROVAL PROCESS, COMPETITIVE COMPANIES, FUTURE CAPITAL REQUIREMENTS AND THE COMPANY'S ABILITY AND LEVEL OF SUPPORT FOR ITS EXPLORATION AND DEVELOPMENT ACTIVITIES. THERE CAN BE NO ASSURANCE THAT THE COMPANY'S DEVELOPMENT EFFORTS WILL SUCCEED AND THE COMPANY WILL ULTIMATELY ACHIEVE COMMERCIAL SUCCESS. THESE FORWARD-LOOKING STATEMENTS ARE MADE AS OF THE DATE OF THIS NEWS RELEASE, AND THE COMPANY ASSUMES NO OBLIGATION TO UPDATE THE FORWARD-LOOKING STATEMENTS, OR TO UPDATE THE REASONS WHY ACTUAL RESULTS COULD DIFFER FROM THOSE PROJECTED IN THE FORWARD-LOOKING STATEMENTS. ALTHOUGH THE COMPANY BELIEVES THAT THE BELIEFS, PLANS, EXPECTATIONS AND INTENTIONS CONTAINED IN THIS NEWS RELEASE ARE REASONABLE, THERE CAN BE NO ASSURANCE THOSE BELIEFS, PLANS, EXPECTATIONS OR INTENTIONS WILL PROVE TO BE ACCURATE. INVESTORS SHOULD CONSIDER ALL OF THE INFORMATION SET FORTH HEREIN AND SHOULD ALSO REFER TO THE RISK FACTORS DISCLOSED IN THE COMPANY'S PERIODIC REPORTS FILED FROM TIME-TO-TIME WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION.
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