VANCOUVER, July 21 /PRNewswire-FirstCall/ - Callinan Mines has received a payment of $2,856,446 from Hudbay Minerals Inc. This payment represents the remaining balance of payments due to Callinan for fiscal 2009 under the 777 / Callinan Mine Net Profits Interest and Royalty agreement. Interim quarterly payments were made throughout 2009, representing an estimated 75% of 6 2/3% of the net profits from the 777 Mine in Flin Flon, Manitoba, plus $0.25 per ton of ore mined. This payment represents the balance of the 25% withheld over the four financial quarters ended December 31, 2009, adjusted to reflect Hudbay's final calculation of the net profits interest. Callinan's legal action against Hudbay in the Manitoba Court of Queens Bench, designed to gain transparency concerning the calculations of past entitlements under the Net Profits Interest agreements, as well as transparency concerning the calculation of these payments going forward is ongoing.
Callinan Mines is pleased to announce that drilling has begun at their wholly owned Coles Creek property south of Houston, BC. The summer program has been designed to test for mineralization in a structure previously identified as a volcanic breccia containing silver, zinc and lead. Diamond drill hole COLE-18, drilled as part of the 2008 drilling program, returned 234 m of mineralization, including 4.7m of 200 g/t silver and 1.09% zinc. Coincident chargeablity and resistivity anomalies have been identified in the same structure, and will be tested as part of this summer's drill program. Initial prospecting has located surface mineralization that is also coincident with this IP anomaly.
The drilling program will continue until the end of the season on the 13,090 Ha property. The volcanic debris flow known to host mineralization and the targets within will be the primary focus of the drill program. Additional 3D induced polarization and prospecting programs will also be conducted.
Drilling has also been planned for Callinan's Herblet Lake property near Snow Lake, Manitoba. This program is designed to test below surface copper and zinc showings that occur on a structure that hosts the Osborne Lake and Anderson Lake Mines.
Drilling on the Gossan - Gurney Gold claims near Cranberry Portage, MB has been postponed until the forest fires in the area have been extinguished, and the ban on access has been lifted.
On behalf of the board of directors,
All of Callinan's Exploration Programs are overseen by Pat Deveaux, a qualified person as defined by National Instrument 43-101 who has reviewed and approved this release.
Some statements in this news release contain forward-looking information. These statements include, but are not limited to, statements with respect to future expenditures. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, among others, the ability to complete contemplated private placements and the timing and amount of expenditures. Callinan does not assume the obligation to update any forward-looking statement.
SOURCE Callinan Mines Ltd.