Advanced Explorations Reaches New Terms On Roche Bay Buy-Out Option
Toronto, Ontario – April 4, 2011 – Advanced Explorations Inc. (TSX VENTURE:AXI)(FRANKFURT:AE6) (the “Company” or “AEI”) is pleased to announce it has agreed to terms for a new buy-out option for the Roche Bay Project (the “New Buy-Out Option”) with Roche Bay plc. and Roche Bay East Limited (“Roche Bay”). As a result of recent discussions, AEI and Roche Bay have amended their Royalty Agreement (as press released April 1st, 2009) and finalized a New Buy-Out Option to enable AEI to reduce any existing royalty to 1.875% on all mineral products (except precious metals).At its election, AEI will have the opportunity to reduce the royalty rate by making a payment of $22,500,000 to Roche Bay by August 5th, 2011. In doing so, AEI will reduce all royalties to 1.875% on all mineral products except any precious metals (such as gold) which was reduced to 3.9%. All other terms and conditions set out in AEI’s agreement with Roche Bay will remain the same. If the New Buy-Out Option is not exercised the previous buy-out terms as press released on April 1st, 2009 continue to apply. Any amendments remain subject to TSX Venture Exchange approval.
John Gingerich, President and CEO, commented:
“The revised agreement enables the Company to further simplify the economics of the Melville Peninsula, Roche Bay and Tuktu projects. The New Buy-Out Option provides the opportunity to potentially secure the necessary funding for a royalty buy-out through our existing or new partnerships. Our priority is to limit shareholder dilution. The high demand for iron ore, and in particular the increasing interest in both our Roche Bay and Tuktu projects are encouragement to finding a payment solution”.
The terms of the amendment do not affect the Company’s right to 100% interest in the Roche Bay Project under the Royalty Agreement, and if exercised allows the Company to lower its royalty rate and stop any minimum annual royalty payments until the Roche Bay Project achieves production revenues.
ON BEHALF OF THE BOARD
John Gingerich, President & CEO
ABOUT Advanced Explorations Inc.
Advanced Explorations Inc., based in Toronto, Ontario, is a resource development company focused on its Roche Bay Iron Ore Project in Nunavut, one of the world’s largest developing iron ore districts. The Roche Bay Project is located proximal to a natural deep water harbour on the coast of the Melville Peninsula in Nunavut, Canada giving it many logistical advantages. The project has an inferred resource of 357 million tonnes, outlined within a small portion of the potential 140 km of banded iron formation. This iron formation incorporates the Roche Bay deposits, the Company’s Tuktu deposits and other targeted deposits in areas to the north, south and west of the Company’s Roche Bay Project. The preliminary economic assessment from the Roche Bay deposit alone indicates a potential net present value of US $1.1 billion. Together with its Chinese partner XinXing Pipes Group, Advanced Explorations is completing the feasibility study on Roche Bay, targeting a rapid advancement into start-up concentrate production. The management team has extensive technical, exploration and Canadian Arctic mining expertise to effectively develop the high quality iron ore opportunities on the Melville Peninsula.
This news release also includes forward-looking statements that involve a number of risks and uncertainties. The information reflects numerous assumptions as to industry performance, general business and economic conditions, regulatory and legal requirements, taxes and other matters, many of which are beyond the control of the company. Similarly, this information assumes certain future business decisions that are subject to change. There can be no assurance that the results predicted here will be realized. Actual results may vary from those represented, and those variations may be material.
This news release does not constitute an offer to sell or a solicitation of an offer to sell any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED WITHIN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
For more information, please contact
Advanced Explorations Inc.
(416) 203-0057 x226