|March 15, 2011|
Rathdowney Completes Qualifying Transaction And $34.3 Million Financing
|March 15, 2011 Vancouver, BC -- Rathdowney Resources Ltd. ("Rathdowney" or the "Company"), formerly Coreland Capital Inc., announces that it has completed its qualifying transaction in accordance with the TSX Venture Exchange Inc. (the "TSX-V") Policy 2.4 with Rathdowney Resources Limited (the "Qualifying Transaction"). The common shares of the Company are expected to begin trading as a Tier 1 Issuer on the TSX Venture Exchange under the symbol "RTH" on March 17, 2011.
Successful Completion of Transaction and Financing
Further to the Company's news release dated September 29, 2010, as part of the Qualifying Transaction a non-brokered private placement financing of 34,283,550 common shares of the Company was also completed at a price per common share of $1.00 for total gross proceeds of $34,283,550 (the "Financing"). All of the Common Shares issued in connection with the Financing are free trading under applicable Canadian and United States securities laws.
The total number of common shares of the Company issued and outstanding on the closing of the Qualifying Transaction is 81,602,881. In connection with the Qualifying Transaction, the Company issued 46,419,331 common shares to the shareholders of Rathdowney Resources Limited. All of those common shares, together with 400,000 post consolidation common shares of the Company purchased by newly appointed principals of the Company and other parties designated by Rathdowney Resources Limited have been deposited into escrow and will be released pursuant to an escrow agreement between Computershare Trust Company of Canada, as the escrow agent, and the Company as to 25% on each of the 6, 12, 18 and 24 month anniversaries of the date of closing.
Rathdowney President & CEO John Barry commented "We are very pleased with the interest shown by the global financial market in Rathdowney and to have successfully transitioned to become a publicly traded company. We have also secured a significant financing at a share price valuation that substantiates the high quality of the Company's projects. Our targeted drilling programs have excellent potential to confirm mineral resources in Poland and to make new zinc-lead discoveries in Ireland."
Poland: New Potential in a Historic Mining District
In Poland, the Company's interest is the Upper Silesian Mining District, an area of world-class Mississippi Valley-type (MVT) zinc-lead deposits. Mining has been underway in the district since the 12th century, producing some 16 million tonnes of zinc and 4 million tonnes of lead.
Rathdowney holds two concessions, called Rokitno and Zawiercie, located approximately 100 kilometers from the city of Krakow in south-eastern Poland. This area has well-developed infrastructure, including smelting facilities as well as modern mining expertise. The large, operating Pomorzany underground zinc-lead mine and zinc refinery complex is located 10 km south of the property.
Rathdowney's technical team was attracted to the area by its high potential for both confirming known potentially economic zinc deposits and discovering new ones. Drilling was carried out by the Polish State Survey in the area of the concessions from the 1970s to the late 1980s, providing extensive geological and historical drilling information and indicating the presence of significant mineral deposits on the ground. Several estimates of the resources were also done by the State Survey under a Soviet-era classification system. These historical estimates ranged from 10 - 30 million tonnes of zinc-lead resources for the Rokitno deposit, 16 - 34 million tonnes of resources for the Zawiercie I deposit and 21 - 42 million tonnes of resources for the Zawiercie II deposit, as shown in the appended tables. For Rokitno and Zawiercie I, the estimates would correspond to indicated and inferred categories whereas the less defined Zawiercie II deposit would be inferred. These historical estimates should not be relied upon; there can be no assurance that the resources, in whole or in part, will ever become economically viable.
Most mines in the Upper Silesian district are hosted by a flat-lying to gently dipping dolomite of Middle Triassic age. Past drilling on the Rathdowney ground has shown that replacement MVT mineralization in this dolomite unit at depths generally ranging from 50 - 250 m. Steeply-dipping faults and fractures related to the Krakow-Myszkow tectonic zone control the location of the deposits. Mineralization related to these structures also occurs in the underlying Devonian-age strata, providing additional exploration potential.
A two-pronged program has commenced, encompassing geophysical surveys for orientation over known mineralization and rolling out this survey over undrilled areas, as well as conducting confirmatory drilling designed to test the extent of the mineralization and to support 43-101 compliant resource estimates. Some 40,000 metres of drilling is planned in the first phase.
Ireland: Drill-ready Targets in the Irish Midlands Ore Field
The Irish Midlands host one of the world's great ore fields, hosting well-known deposits such as Navan, Lisheen and Galmoy. Boliden's Navan is the largest zinc mine in Europe and fifth largest in the world; Vedanta's Lisheen is in the top 12 zinc-lead mines worldwide; and Lundin's Galmoy Mine was also a substantial past producer. In addition, recent discoveries have been made by Lundin, Teck and Xstrata.
The Irish Midlands Province is dominated by a gently-folded to flat-lying sequence of marine sedimentary rocks. Irish-type carbonate-hosted sulphide deposits occur as single or stacked sulphide lenses, grading from massive sulphides to vein-controlled and/or disseminated sulphide zones.
Rathdowney's substantial land portfolio comprises some 2,000 square km in eight project areas. Each property has good road access, and most are near to railways, power lines and communities with skilled labour and services.
Over the past two years, Rathdowney has undertaken programs of shallow and deep overburden geochemical sampling (encompassing over 20,000 samples), as well as airborne geophysical surveys, including the electromagnetic (SkyTEM) method, over selected ground. This work has established compelling drill-ready zinc-lead targets on six of Rathdowney's project areas. Some 15,000 metres of exploration drilling is planned to test 45 prioritized targets.
The technical information in this release has been reviewed by Ed Slowey, P.Geo., a Qualified Person as defined by NI 43-101 who is independent of the Company.
As part of the Qualifying Transaction the Company also completed a consolidation of its outstanding shares on the basis of five pre-consolidation shares for one post-consolidation share and changed its name from "Coreland Capital Inc." to "Rathdowney Resources Ltd."
The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act. This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction.
Rathdowney is a mineral exploration company focused on finding and developing the next generation of base metal deposits in the ore fields of Poland and Ireland. Its major shareholder is Hunter Dickinson Inc. (HDI).
Hunter Dickinson Inc. (HDI) is a diversified, global mine development company with a 25-year history of mineral development success. From its head office in Vancouver, Canada, HDI applies its unique strengths and capabilities to acquire, develop, operate and monetize mineral properties that provide consistently superior returns to shareholders.
For further details on the Company and its projects, please visit www.rathdowneyresources.com or contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.
Form8937 - Report of Organizational Actions Affecting Basis of Securities (PDF)
Source: Technical Report on the Rokitno & Zawiercie Zinc-Lead Projects, Poland, dated December 21, 2010, by E. Slowey, P.Geo., filed at www.sedar.com
The above estimates are historical in nature, and were prepared based on data and reports prepared, and a classification system used by Panstwowy Instytut Geologiczny (PGI), the Polish State Survey. According to Henley, Mining Journal, August 2004, the categories used in the international reporting system correspond to CIM classifications as follows: C1 indicated to measured; C2 inferred to indicated; D is exploration potential. The work necessary to verify the historical estimates has not been undertaken and, therefore, the estimates cannot be considered as current mineral resources as defined under National Instrument 43-101 and verified by a qualified person. The historical estimates should not be relied upon and there can be no assurance that the resources, in whole or in part, will ever become economically viable.
A more recent estimate of the Rokitno deposit was undertaken in 2007 by PGI which does not qualify as a 'historical' estimate under current NI 43-101 guidelines. This estimate was based on a conservative extrapolation distance of 37.5 m around each hole for C-1 category and 75 m for C-2 category. Given a typical minimum drill hole spacing of 250 m, this meant that there was little or no resource continuity, even between adjoining mineralized holes. The restricted sphere of influence around the drill holes was apparently based on a geostatistical study carried out at the Pomorzany mine by an academic geologist. The parameters on which this study was based are not currently known to Rathdowney but are assumed to have included studies of variography. The application of the new criteria resulted in a substantial reduction in tonnage compared to the earlier estimates which appear to have placed more reliance on empirical evidence of mineral continuity based on experience at existing mines in the Silesian ore field.
More recent estimates were undertaken in 2005 and 2008 for the Zawiercie I deposit and in 2008 only for the Zawiercie II deposit by PGI which do not qualify as 'historical' estimates under current NI 43-101 guidelines. The same conservative parameters were applied for the most recent 2008 estimates at Zawiercie as for the 2008 Rokitno estimate. For the Zawiercie I deposit, the reduction in size of the 2008 estimate compared to some of the earlier historical estimates is not as significant because the drill holes were more closely spaced and this allowed for continuity in the C-1 and C-2 categories between holes. At the Zawiercie II deposit, the 2008 estimate resulted in a substantial reduction of deposit size compared to earlier historical estimates due to the wider drill hole spacing at that deposit.