VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 5, 2012) - Sniper Resources Ltd. (TSX VENTURE:SIP)(FRANKFURT:A1H38M) ("Sniper" or the "Company") announces that, subject to receipt of approval of the TSX Venture Exchange (the "Exchange"), it plans to issue an aggregate of 2,339,408 common shares at a deemed price of $0.1083 per share (the "Issue Price") to Columbus Gold Corporation pursuant to the terms of the Company's option agreement with Columbus Gold and its US subsidiary dated September 26, 2011 (the "Agreement").
Pursuant to the Agreement, in order to maintain the Company's option to earn an initial 51% interest in the Weepah property located in Esmeralda County, Nevada, the Company was required to incur exploration expenditures totalling US$500,000 on or before September 26, 2012, and to issue US$10,000 worth of shares as a first anniversary property payment.
As the Company has incurred eligible exploration expenditures totalling US$252,836 on the property, the Company has determined to satisfy the US$247,164 shortfall and maintain the option in good standing through the issuance of 2,248,439 common shares to Columbus Gold at the Issue Price (after converting the shortfall amount to Canadian dollars) as permitted by the terms of the Agreement, subject to Exchange approval. The Issue Price is calculated based on the 30 day volume weighted average closing price of the Company's shares on the Exchange prior to September 26, 2012, pursuant to the Agreement.
The Company is also issuing 90,969 common shares to Columbus Gold at the Issue Price in satisfaction of the first anniversary property payment of US$10,000 as required by the Agreement.
The Company plans to raise additional funds to commence a phase three drill program on the Weepah property and for working capital requirements, further to its news release dated July 31, 2012 disclosing a non-brokered private placement of units at a price of $0.10 per unit. The Company plans to complete that private placement on or about October 15, 2012.
In order to maintain the Weepah option pursuant to the Agreement, after issuing the above common shares to Columbus Gold, the Company is required, among other things, to incur an additional US$1,000,000 in exploration expenses on the Weepah property by September 26, 2013. Details of the Agreement are contained in the Company's news release dated September 27, 2011.
ABOUT SNIPER RESOURCES LTD.
Sniper Resources Ltd. is engaged in the identification, acquisition and exploration of gold properties in the State of Nevada, USA. Sniper owns a 100% interest in the ReHot project and holds options to earn a controlling interest in four strategically located Nevada gold projects, namely, Laura, Overland Pass, Weepah and Guild.
Sniper Resources Ltd.
Scott Baxter, Chief Executive Officer
This news release includes certain forward-looking statements or information. All statements other than statements of historical fact included in this release, including, without limitation, statements relating to plans for the completion of a private placement, and other future plans, objectives or expectations of the Company are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's plans or expectations include risks relating to: availability of capital and financing required to complete the private placement in the current difficult market conditions and to continue the Company's exploration programs; general economic, market or business conditions; the actual results of current and planned exploration activities; the geology, grade and continuity of any mineral deposits; fluctuating gold prices; risks associated with property option agreements, leases, joint ventures and the ability to conclude joint venture agreements on favourable terms; possibility of accidents, equipment breakdowns and delays during exploration; exploration cost overruns or unanticipated costs and expenses; regulatory changes and restrictions including in relation to environmental liability; timeliness of government or regulatory approvals and other risks detailed herein and from time to time in the filings made by the Company with securities regulators. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise except as otherwise required by applicable securities legislation.