"SPOKANE, WA, Nov. 14 /CNW/ - Minera Andes Inc. (TSX: MAI; US OTC: MNEAF) is pleased to report that a definitive Option Agreement has been executed by Minera Andes and Xstrata Copper regarding the Los Azules porphyry copper project in San Juan province, Argentina. The Option Agreement consolidates into one package adjoining properties that straddle a large copper porphyry system."
"Under the Option Agreement, MASA has the right to earn a 100% interest in Xstrata Copper's property by spending at least US$1.0 million on the property by November 2010, making payments to keep the property in good standing and producing a preliminary economic assessment (to NI 43-101 standards). If in the opinion of Xstrata Copper, the preliminary assessment shows the potential to economically produce 100,000 tonnes (200 million pounds) of contained copper per year for 10 years or more then Xstrata Copper will have a right to earn a 51% interest in the combined properties (the "Back-in Right")."
Minera Andes made sure that their agreement is valid with Xstrata Copper before new round of drilling. Looks like they are sure that Xstrata will have economic intention to exersice the back in right.
Should I remind that TNR Gold holds back in rights of 25% with Xstrata on Los Azules property and two best intersections are on TNR Gold's land.
"Xstrata AgreementMinera Andes owns a 100 percent interest in its land that makes up the southern half of the property. The Xstrata lands (see map) are subject to a letter of intent whereby Minera Andes has the right to earn a 100 percent interest in Xstrata's property by spending at least US$1.0 million on the property over the next four years, making payments to keep the property in good standing and producing a preliminary economic assessment (to NI 43-101 standards). If the preliminary assessment shows the project to be potentially economically viable at a potential production rate of 100,000 tonnes (200 million pounds) of copper per year for 10 years then Xstrata will have a one time back-in right to earn a fifty one percent interest in the combined properties by making a cash payment to Minera Andes of three times Minera Andes' expenditures on the property, completing a bankable feasibility study within five years and assuming underlying property commitments. In the event that the preliminary assessment does not meet the size criterion contemplated above, Xstrata's interest would reduce to a first right of refusal on any subsequent sale of the property. All lands that make up the property's mineral applications are subject to a provincial mouth of mine royalty of between zero and three percent. This royalty will be negotiated with the province of San Juan as the project advances. The Xstrata lands to be acquired by Minera Andes are subject to two underlying agreements. The first agreement covering approximately 1,400 hectares has remaining payments totaling US$845,000 to acquire a 100 percent of these lands. The second agreement (WITH TNR GOLD Sufiy), covering the remainder of the Xstrata lands contains underlying payments totaling US$410,000, a US$1.0 million work commitment and a 25 percent buy back clause if a feasibility study is completed within 3 years of Xstrata/Minera Andes exercising the option to acquire the property, subject to payback to Xstrata/Minera Andes of two times the expenditures on the property. If the vendor buys back 5 percent or less there interest will convert to a one percent net smelter royalty."
TNR Gold Corp New Presentation:
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