Mon Jul 28, 2008
Rimfire Partners with Northgate to Explore Australia's Stawell Gold Trend
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PR08-11
Vancouver, BC -- July 28, 2008: Rimfire Minerals Corporation ("Rimfire") is pleased to announce a new exploration partnership with gold-producer Northgate Minerals Corporation (NGX-TSX), which grants Rimfire an option on its Stawell Corridor gold exploration properties in the State of Victoria, Australia. Northgate, through its 2008 acquisition of Perseverance Corporation Ltd., acquired a dominant claim position in the Victoria Goldfields, host to over 50 million ounces of gold in both alluvial and hard rock reserves and production.
"With this agreement, we are building on an established relationship," said President and CEO, Jason Weber. "It is a terrific opportunity that became available to us because Northgate's focus is on exploration around their two operating mines, allowing us to advance their outside targets in the corridor."
Chris Rockingham, VP of Exploration and Business Development for Northgate stated, "From Northgate's perspective, choosing Rimfire as a joint venture partner was easy. They have proven to be very capable operators in our Canadian Joint Ventures and the Stawell Corridor land package is ideally suited for their grass roots exploration skill set."
Highlights of this agreement include:
• The opportunity to explore a highly productive gold belt in a politically stable jurisdiction.
• The land position is coherent, encompassing much of the Stawell Corridor. The Stawell Corridor itself is well defined with Northgate's high grade Stawell Gold Mine (SGM) at its core.
• Excellent greenfield exploration opportunities. The exploration model for the corridor has been extensively studied, providing exploration criteria at both the regional and detailed scales. Rimfire will have access to Northgate's SGM which will help build a better understanding of the geological model and improve Rimfire's exploration effectiveness.
• High quality targets with convincing similarities to SGM exist in the land package being made available to Rimfire. Previous work programs were well designed, identifying numerous targets that have yet to be brought to the drill-ready stage, however, insufficient resources were available to the predecessor company to conduct systematic greenfields exploration of the entire land package.
• The deal is structured similar to other Rimfire/Northgate arrangements in which Rimfire undertakes to advance exploration to the point where drill targets are defined, at which time Northgate can take over funding of exploration, earning a larger percentage in the property for doing so.
The Stawell Corridor is a 240 km long belt bound by the Congee and Moyston faults and cored by Northgate's 5 million ounce Stawell Gold Mine (20 Mt at 8 g/t gold). Mineralization consists of gold-bearing quartz veins in ferruginous (iron-rich) sediments associated with basalt centres. This deposit has been studied extensively, resulting in the identification of large-scale characteristics that can be used in the exploration for similar deposits elsewhere in the district. Geophysical techniques such as gravity and magnetics surveys have proven effective in targeting basalt centres and granites associated with mineralization. These techniques will be important in evaluating the rest of the Stawell Corridor and refining targets for drilling.
Rimfire will be exploring three licences, totaling 120 km of the corridor length, representing all ground outside of a buffer around the Stawell Gold Mine. In addition to greenfields opportunities, more advanced targets exist including the 10 kilometre-long Murtoa target, which surrounds the Kewell gold resource. The Kewell resource, which Northgate has opted to exclude from this agreement, is reported to contain a historic 100,000 ounces of gold at 6 g/t gold and has been defined by 25 drillholes. Additional targets include kilometre-scale gravity anomalies that have been confirmed through drilling to reflect basalt centres at depth, with coincident gold and pathfinder element geochemical anomalies on surface. Rimfire has commenced a compilation of all the available data to plan field work for this fall.
Under the agreement, Rimfire agrees to conduct exploration to maintain the licenses in good standing for the current year (approximately $370,000). Rimfire can then elect to conduct further exploration on any or all three of the licenses, earning a 50% interest on each by spending $500,000 per license over two years. Northgate then has the option on each license to: 1) carry out the next $1.5 million to earn back a 10% interest (total 60%) and another 10% by reaching a production decision; 2) not participate and allow Rimfire to earn a 100% interest in the property by spending, or causing to have spent, an additional $2 million over 4 years; or 3) participate in a 50/50 joint venture.
