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Valdez Gold and Millrock Resources Sign Letter of Intent to Form a Joint Venture on Bluff Project in Alaska

^{Published on 2009-12-22 06:10:25 - Market Wire}
 

TORONTO, ONTARIO--(Marketwire - Dec. 22, 2009) - Valdez Gold Inc. (TSX VENTURE:VAZ or "Valdez") is pleased to announce that it has signed a letter of intent to form a Joint Venture (JV) on Millrock Resources Inc.'s ("Millrock") Bluff Project ("Bluff") on the Seward Peninsula in Alaska, USA. Under the terms of the letter of intent Millrock would grant Valdez the right to earn a 55% interest in the Bluff Project by incurring US$3.0 million in qualified expenditures over a three year period (with a minimum of US$500,000 of qualified expenditures by December 31, 2010) with a cash payment to Millrock of US$50,000 and 300,000 common shares of Valdez on signing the definitive agreement, US$100,000 and 300,000 common shares of Valdez after the first year, and US$150,000 and 300,000 common shares of Valdez after the second year. If the earn-in is achieved, Valdez would further have the option to increase its share to 75% by spending an additional US$3 million of qualified expenditures over three years and making further staged cash payments totaling US$600,000 and issuing 1.1 million common shares of Valdez by the end of the fifth year. Upon earning a 75% interest, Millrock would have the one-time opportunity to elect to earn back a 25% interest (to hold a 50% interest), by expending on exploration and development, two times the amount that Valdez had expended on the project, or, by expending the amount necessary to define an NI 43-101 compliant resource of greater than two million ounces of gold, whichever is less. Valdez is able to opt out of the JV at any time once it has made US$500,000 in qualified exploration expenditures.

Bluff is located on the Seward Peninsula in Alaska, 24 kilometres east of the Big Hurrah deposit, which NovaGold Resources Inc. is considering for production and processing at the Rock Creek Mine. Millrock has an option agreement with the underlying property owner Golden Glacier Inc., a subsidiary of Bering Straits Native Corporation ("BSNC"). The option allows Millrock to earn a 100% leasehold interest.

At Bluff, structurally controlled gold mineralization occurs within an anticline. The prospective arcuate structure is mineralized over a distance of 6.4 kilometres. During the period from 1986 to 1990, BHP discovered three zones of lode gold mineralization - Daniels Creek, Saddle, and Koyana. The gold mineralization was discovered by drilling strong surface gold - arsenic geochemical anomalies. These zones contain several significant intersections including 5.48 g/t gold over 10.9 meters, 4.19 g/t gold over 4.5 meters, and 1.93 g/t gold over 16.3 meters. In the 1980s, BHP carried out a series of exploration programs at Bluff, but terminated its efforts in 1990. The property sat idle for two decades until Millrock secured it. Millrock carried out exploration in 2008. Geological mapping and soil sampling identified new zones of mineralization. Drilling and resampling of BHP core confirmed the presence of gold mineralization. Significant drilling is required at all zones to establish and delineate gold resources. There are numerous drill targets adjacent and down-dip from known gold zones and untested surface geochemical anomalies. For further information, please see a complete report documenting prior exploration work prepared for Millrock by independent geologist Donald Stevens of Anchorage, Alaska that has been filed on SEDAR: Bluff Gold Prospect, National Instrument 43-101Technical Report June 5, 2009 Prepared by Donald L. Stevens Ph.D.

Completion of the transaction contemplated in the release is subject to certain conditions including, without limitation, signing of a definitive agreement, and receipt of all necessary regulatory and third party approvals.

Michael Skead, MAusIMM, President & CEO for Valdez, and a qualified person as defined by NI 43-101, reviewed the technical content of this press release on behalf of Valdez prior to distribution.

This press release contains forward-looking statements within the meaning of applicable securities legislation. Such statements include, without limitation, statements regarding the future results of operations, performance and achievements of the Company, including potential property acquisitions, the timing, content, cost and results of proposed work programs, the discovery and delineation of mineral deposits/resources/reserves, geological interpretations, proposed production rates, potential mineral recovery processes and rates, business and financing plans and business trends. Although the Company believes that such statements are reasonable, it can give no assurances that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, significant downward variations in the market price of any mineral that may be produced, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, to produce minerals from its properties successfully or profitability, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies. All of the Company's public disclosure filings may be accessed via [ www.sedar.com ] and readers are urged to review these materials, including any technical reports filed with respect to the Company's mineral properties. This press release is not, and is not to be construed in any way as, an offer to buy or sell securities in the United States.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.