HENDERSON, NEVADA--(Marketwire - 03/31/11) - Fortune Oil & Gas, Inc. (PINK SHEETS:FOGC - News) (www.fortuneoilandgascorp.com) has signed a Letter of Intent (LOI) for a mining property in British Columbia, Canada.
The LOI specifies that Alta Mining will acquire SHG Claim Set, a silver, lead and zinc-bearing property located in a well-known mining district about 25 kilometers northwest of Kaslo, B.C.
Mineralization on the property is typical for well-known silver-lead-zinc mineralization that occurs in the Triassic Slocan Group. The property also includes greenstones and ultramafic rocks of the Permian Kaslo Group, which also host rich silver-lead-zinc mineralization. The general structural trend is 310 degrees, dipping generally southwesterly. The mineral deposit is a polymetallic type of vein that bears silver, lead, zinc and sometimes gold.
The entire region is known for high-grade silver and gold deposits, and numerous past and current producers are in close proximity to the property. The latest reports on the property were completed in the early 1970s, but there was no significant success in revealing its mineral capacity.
A confidentiality clause in the LOI prevents FOGC from revealing more details about the property. The company will issue a full report immediately upon the execution of the final contract with the property owner.
FOGC has taken a major step forward in executing its strategy by securing a mining property with historically confirmed mineralization for its portfolio of projects, and sees this as a catalyst for further expansion. SHG Claim Set is a perfect fit for the company's development policy in that it has a history of mineralization and undeveloped potential caused by old exploration techniques. Modern technology gives FOGC an opportunity to compress the time that it takes to realize the full potential of the property.
FOGC CEO Serge S. Acimovic stated: "The business understanding between the claim holder and us is strong and positive. Post-LOI negotiations are moving in the desired direction with a big probability for a definitive agreement. Properties that are strategically well-placed in a district with a rich history of mining will fuse the company's power to implement advanced exploration technology on the historically defined and confirmed mining potential of SHG Claim Set.
"This LOI that calls for purchasing 100% of the ownership and all mineral rights on the proposed property is a major step forward in executing our strategies. This step will define Fortune Oil & Gas as a prosperous junior exploration company in the global mining market.
"Silver and other commodities that are present on the property have experienced a significant upward price movement through 2010 and the first quarter of 2011, and analysts aren't expecting those price increases to slow to any significant degree in the future. International market and political circumstances are working favorably in support of this upward trend, and industrial demand for silver isn't going to fall. All of these factors give us a strong belief that resource pricing will continue to move upward.
"The Letter of Intent will be superseded by a definitive agreement that's subject to mutual approval. It's intended to be completed upon both parties agreeing on the agreement structure that has to comply with all necessary legal and regulatory requirements. At the same time, it has to minimize or eliminate any unfavorable financial consequences for Fortune Oil & Gas and increase cost-effectiveness, which is the ultimate goal in the company's development policy."
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