Letter Of Intent Signed For The Company’s Brazilian Tin Projects
August 29, 2011 (TSX Venture: LRA) - Lara Exploration Ltd., (“Lara” or the “Company”) is pleased to announce that it has signed a Binding Letter of Intent (“the Agreement”) with Triumph Tin Mining Ltd., (“Triumph”), to explore and develop the Company’s tin projects in Rondo^nia State, northwest Brazil. Triumph will take over the Company’s option to acquire 100% of the Sa~o Lourenc¸o Tin Project and can earn up to a 75% interest in the Company’s 100%-owned tin exploration portfolio, denominated the North Brazilian Tin Project. The Agreement is subject to a 60-day due-diligence period and completion of a Definitive Agreement.
Sa~o Lourenc¸o Tin Project
Under the terms of the Agreement, Triumph can assume the Company’s rights to the Sa~o Lourenc¸o Tin Project by paying US$50,000 in cash and issuing US$500,000 in shares within 30 days of signing the Definitive Agreement. Triumph will pay a further US$1,000,000 in cash and/or shares in four annual payments of US$250,000 starting one year from signing the Definitive Agreement and will pay a 1% net smelter return royalty on any production.
The Company has an option to acquire 100% of the rights Sa~o Lourenc¸o Tin Project for US$1,100,000 in cash (US$100,000 paid to date) payable before May 2012. The project comprises seven mining licenses covering a total of 3,408 hectares, where a local company, Minerac¸a~o Oriente Novo S.A., produced some 12,000 tons of tin between 1973 and 1988, before going into liquidation. Production has continued on a small-scale since then to keep the licenses in good standing and there are still roads and camp infrastructure maintained on the property. Triumph will assume responsibility for the remaining obligations under the option agreement and will undertake to drill a minimum of 1,500 metres of diamond core drilling within 12 months of signing the Definitive Agreement.
North Brazilian Tin Project
Under the terms of the Agreement, Triumph can also earn up to a 75% interest in the North Brazilian Tin Project by paying US$35,000 in cash on signing the Definitive Agreement, investing US$2,500,000 in exploration over four years and paying a 1% net smelter return royalty on production. The North Brazilian Tin Project comprises seven exploration licenses covering a total of 36,634 hectares.
The Company follows industry standard quality assurance and quality control procedures for all its exploration under the supervision of Michael Bennell, Lara’s Vice President Exploration and a member of the Australasian Institute of Mining and Metallurgy (AusIMM), is a Qualified Person as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects and is responsible for the preparation and verification of the technical information in this release.
Lara is an exploration company following the Prospect Generator business model, which aims to minimize shareholder dilution and financial risk by generating prospects and then exploring them in joint ventures funded by partners. The Company currently holds a diverse portfolio of prospects and deposits in Brazil, Peru, Colombia and China and has signed agreements for eleven joint ventures. Lara’s common shares trade on the TSX Venture Exchange under the symbol “LRA”.
For further information on Lara Exploration Ltd. please consult our website www.laraexploration.com, or contact Chris MacIntyre, VP Corporate Development, at +1 416 703 0010.
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.