Great Western Minerals Group Satisfies Escrow Conditions for Release Of Offering Funds
(May 10, 2012) – Saskatoon, Canada: Great Western Minerals Group Ltd. ("GWMG" or the "Company", TSX:V – GWG) is pleased to report that it has satisfied the escrow release condition of the convertible bond financing (the "Offering") (See GWMG April 5, 2012 media release: GWMG Announces Closing of US$90 Million Convertible Bond Financing). The remaining funds, net of US$10.8 million that will remain in escrow to satisfy interest payments, will be released immediately to the Company.
In order to satisfy the escrow release condition, GWMG was obligated to have Caracle Creek International Consulting Inc. ("CCIC") provide the escrow agent with a letter ("Confirmation Letter”) confirming that at least 20,000 metric tonnes of Total Rare Earth Oxides ("TREO”), in the sum of the Measured, Indicated, and Inferred resource categories using a one per cent cut-off grade, are present at the Steenkampskraal property.
The Confirmation Letter indicates the presence of at least 26,600 metric tonnes of TREO under the Inferred resource category. The Company expects to file the compliant resource estimate on the Steenkampskraal property (the "NI 43-101 Report") on or before May 31, 2012.
The Confirmation Letter is based on geological and assay information limited to the immediate area of the historic mine developments at Steenkampskraal including: recent resource confirmation drilling; the first phase of underground channel sampling; structural mapping; and underground mapping of mineralization.
Not included in the Confirmation Letter, but anticipated to be incorporated into the NI 43-101 Report, are results from recent sampling of mineralization in the up-dip and down-dip extremities of the historic mine area, the two tailings dams, and the rock dump.
As well, GWMG remains actively engaged in exploration activities at Steenkampskraal, as previously announced (See: GWMG Corporate Update media release, February 7, 2012). The Company launched a minimum 3,000 meter HQ drilling program that includes targeting extensions of mineralization on-strike and down-dip to the west and east, and outboard targets located in close proximity eastward from the historic mine site. A second exploration drilling program of continued infill and step-out boreholes building on positive results from the first exploration program is also planned for Steenkampskraal.
GWMG President and Chief Executive Officer Jim Engdahl stated, "We are extremely pleased to be able to deliver, as scheduled, the Confirmation Letter that enables the release of funds from the Offering. With these funds in place, we are positioned to continue with the development of the Steenkampskraal operation including the continuation of exploratory drilling that we anticipate will further increase the resource calculation."
Quality control measures for all assay results were assessed by CCIC during ongoing analytical procedures and staged receipt of assay data from the SGS Canada laboratory located in Toronto, Ontario.
Brent Jellicoe, B.Sc., P.Geo, is the Qualified Person for GWMG that is responsible for evaluation and exploration activities at Steenkampskraal, and for supervising the preparation of the technical contents of this news release. John Hancox, Ph.D., Pr.Sci.Nat., of CCIC is the principal independent Qualified Person responsible for supervising the ongoing resource evaluation of Steenkampskraal for GWMG.
