Mr. Todd McMurray of Artha reports
PROPOSED ACQUISITION OF CARDERO ARGENTINA S.A. AND ORGANULLO PROJECT
Artha Resources Corp. has entered into negotiations with Cardero Resource
Corp. in connection with a proposed arm's-length transaction, whereby Artha will acquire all of Cardero Resource Corp.'s interests in a wholly owned
Argentine subsidiary, Cardero Argentina S.A., in exchange for common
shares in the capital of Artha. Cardero Argentina's principal assets include the 100-per-cent-owned
Organullo gold-silver project located in Salta province, Argentina, the 100-per-cent-owned former-producing Mina Angela gold-silver property located in Chubut province, southern Argentina,
and an extensive proprietary exploration data set covering northwestern and west-central
Argentina.
The effect of the transaction will be a reverse takeover of Artha by Cardero resulting in
Cardero becoming a new control person of Artha, within the meaning of TSX Venture Exchange
policies.
The transaction is subject to approval by the TSX-V and shareholders of Artha. Artha expects
to hold a special annual and general meeting of shareholders on or about April 30, 2015, for the
purpose of obtaining shareholder approval of the transaction. The transaction cannot close
until the required shareholder approval is obtained. There can be no assurance that the
transaction will be completed as proposed or at all. Assuming the transaction is completed and
approved, changes will be made to the current board of directors and management of Artha.
Artha expects to conduct a private placement offering in connection with the closing of the
transaction in the approximate amount of $700,000, which will be directed toward exploration
and resource definition at Organullo, as well as general working capital. Upon the closing of the
transaction, Artha's material listing property will be the Organullo project.
Charles Straw, Artha's chief executive officer, commented, "I believe this transaction is a great
opportunity for existing shareholders of Artha who will be exposed to two quality precious
metals assets in Argentina, access to capital to move those projects forward and an extensive
exploration database with which to generate new opportunities."
Organullo gold deposit
The Organullo project is a relatively advanced epithermal gold-silver project located close to
infrastructure in the mining-friendly province of Salta, northwestern Argentina, with excellent
potential for both high-sulphidation-type epithermal high-grade gold, as well as bulk-tonnage
lower-grade gold mineralization.
LC022315-1:
Highlights from the property include:
- A total of 1,580 surface rock samples collected by previous explorers from an area of
approximately eight kilometres by eight kilometres averaging 0.25 gram per tonne gold;
- Historical reverse circulation drilling highlights including 189 metres of 0.66 g/t gold and 200 metres of
0.66 g/t gold (both intersections from surface) in historical drilling prior to Cardero's
ownership of the property;
- Diamond drilling highlights including 91.65 metres at 0.66 g/t gold;
- Cardero considering that historical exploration inadequately tested this large, pervasive, gold-silver-bearing system;
- Gold values from 361 rock samples collected by Cardero over eight km of strike averaging
0.48 g/t gold and ranging from below detection to 29.7 g/t gold;
- Mapping and geochemical analyses conducted by Cardero defining a 2.1-kilometre-by-800-metre
zone of hydrothermal alteration indicative of both low- and high-sulphidation-style
epithermal gold deposits;
- Geophysical surveying conducted by Cardero characterized the historical Julio Verne
mine and identified similar targets over a five-kilometre strike length.
The sampling and drill data mentioned herein were collected prior to Artha's involvement with
the Organullo property. A qualified person for Artha (within the meaning of National Instrument
43-101 of the Canadian Securities Administrators) has not verified the data disclosed, including
sampling, analytical and test data underlying the information.
The Fraser Institute Annual Survey of Mining Companies (2014) places Salta province second in
all of South America in terms of its investment attractiveness index.
Artha considers the Organullo project to offer excellent drill-ready targets with a focus on
delineating both large bulk-tonnage potential, as well as higher-grade zones.
Mina Angela gold deposit
Mina Angela is located in Chubut province in southern Argentina. The property was explored by
several companies between 1951 and 1978, and production recommenced in 1978. The
underground mine was operated by Cerro Castillo SA until 1992, producing more than 150,000
ounces of gold. The mineralized system remains open at depth. Government records from 1983
until the mine closed in 1992 show mining production was 1.04 million tonnes for this period
with average grades of: 4.0 grams per tonne gold, 48.4 g/t silver, 2.0 per cent lead, 0.4 per cent copper and 4.6 per cent zinc.
In 1996, Lonrho Mining Ltd. acquired equity in Cerro Castillo and conducted a detailed
exploration program in 1997 and 1998, including 3,500 metres of drilling, which targeted
anomalies identified using geophysics and soil geochemistry. Exploration by Lonrho in 1998
discovered a new vein system: the Sahuel prospect. Geophysics indicate the vein has a
potential strike length of 1.6 kilometres. Significant drill intercepts include 1.36 metres of 40.65 g/t gold
and two metres of 6.69 g/t gold. Lonrho estimated the downdip extension of ore at Mina Angela
to extend for another 150 metres, at Mina Camila for about 250 metres and at Sahuel for 400
metres.
Cardero acquired the property in 2004 and entered into a joint venture with Hochschild Mining
PLC in 2005. Hochschild entered into a feasibility study to restart mining, and as part of this
process, it paid the final $350,000 option payment to secure 100 per cent. Hochschild withdrew in
2009 due to the global economic crisis.
Despite past production, the property remains largely underexplored. There is high potential for
extension of ore reserves along the downdip extensions of the vein systems at Mina Angela,
Mina Camila and the Sahuel prospects. There are several additional identified targets with the
opportunity for new discoveries. The property is ideally located, with proximity to national
transportation infrastructure.
The technical information in this news release has been reviewed and approved by Mr.
Straw, BSc, a director and chief executive officer of the company, a qualified person for the purpose of
National Instrument 43-101.
We seek Safe Harbor.
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