Vancouver, British Columbia – Gainey Capital Corp. (TSXV: GNC) (OTC: GNYPF) (“Gainey” or the “Company”) is pleased to announce that it has signed a letter of intent (“LOI”) with Grupo Wolinak S.A. de C.V. (“Grupo Wolinak”) for the purchase and processing of a gold and silver mineralized bulk sample at the Company’s Huajicori mill. The bulk sample will be sourced from mineralized material located on surface at a historic gold, silver district within trucking distance of the mill. Prior work indicates grades of the bulk sample should be in the range of 2 – 2.5 g/t gold and 250 – 300 g/t silver. Results of the test work will be utilized to determine the viability of entering into a longer term processing agreement.
As part of the LOI, Grupo Wolinak will source the mineralized material for the bulk sample which will be transferred to the Huajicori mill for processing. Initial shipments are anticipated to arrive at the mill during the week of March 5th. Grupo Wolinak is a private Mexican company based in Torreon, Coahuila with knowledge of low cost sources of mill feed within Mexico and could be instrumental in establishing additional mill feed sources for Gainey.
Results from processing of the bulk sample will determine the average grade of the sampled material, the recoveries attainable by the mill and costs associated with processing the material. If the results are favorable, the parties intend to move forward by negotiating a formal ore processing agreement and evaluating the remaining surface mineralized material. A study completed in 2007 estimated in excess of 30,000 tonnes of surface mineralized material located at various locations on the property at an average grade of 2.65 g/t gold and 300 g/t silver. While the report is justification for proceeding with a bulk sample it was not prepared in accordance with NI 43-101 and should not be relied upon until verified.
In addition to the property potentially representing a low cost source of feed material for the Huajicori mill, the Company is also reviewing the property as a potential exploration acquisition. Initial due diligence indicates numerous historic high grade Au-Ag workings clustered in a number of closely spaced districts. The majority of the mineralized zones are within short trucking distance of each other and highway access. Potential exists for the discovery of both small scale mineralized structures as well as larger tonnage, high grade zones.
David Coburn, Gainey Capital’s CEO stated, “We are confident this processing partnership will allow Gainey to establish a longer term tolling strategy utilizing our 300 TPD gravity/ flotation mill. Positive cash flow generated from a potential agreement will allow the company to move forward more aggressively on exploration projects we are currently considering.”
In light of recent opportunities, the company has elected to not move forward with the La Minita property located in Sinaloa, Mexico.
Brian Metzenheim, Vice President Exploration, Gainey Capital Corp. is the Company’s Qualified Person as defined by NI 43-101 and has reviewed and approved the technical information in this news release.
ON BEHALF OF THE BOARD OF DIRECTORS
David Coburn, Chief Executive Officer
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FORWARD LOOKING STATEMENTS: This press release may contain forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential” and similar expressions, or that events or conditions “will”, “would”, “may”, “could” or “should” occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company’s management on the date such statements were made. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
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