Hinterland Options Ballarat Property In White River Gold Play, Yukon

Hinterland Metals Inc. has signed an option agreement to acquire a 100-per-cent interest in the 12-claim Ballarat property located approximately 15 kilometres to the south of the Golden Saddle zone where Underworld Resources Inc. recently reported notable gold values in drill intersections. Under the terms of the option, Hinterland has agreed to pay the vendor $40,000 cash, issue 400,000 shares and complete $500,000 of exploration work scheduled over a three-year period to earn a 100-per-cent interest in the property subject to a 2-per-cent royalty on mineral production. Hinterland will have the option to purchase 1 per cent of the royalty for $1-million and will have the right of first refusal on the remaining 1 per cent. In addition, Hinterland has agreed to pay the vendor an advance royalty of $110,000 upon the completion of an NI 43-101-compliant report that defines measured or indicated gold resources of 110,000 ounces or more on the property. The transaction is subject to regulatory approval. All securities issued pursuant to the option agreement will be subject to a four-month hold period from the date of issue.

Hinterland Properties near Underworld White Gold

Hinterland Properties near Underworld's White Gold

The vendor has been active in the White River area as far back as 1980 when he was involved in placer mining. He first staked the 102 Near claims in 1990 that covered most of Underworld’s present Black Fox property. In 1996 he restaked the 12 Kit claims at the head of Ballarat Creek to cover a southeast-trending soil geochemical anomaly outlined in 1991 that showed maximum individual values of 811 parts per billion (0.8 gram per tonne) gold (Yukon Geology AFR 092982). Quartz boulders on the Kit claims were also reported to return values up to 0.925 ounce per ton gold. Subject to the option agreement, Hinterland has staked the adjacent 68 Tik claims to cover the projected southeastern extension of the geochemical anomaly. Assuming all the staked claims are accepted and recorded by the Yukon mining recorder, the Ballarat property will include 80 claims (1,661 hectares) covering the southeastern slopes of Thistle Mountain. Historical cumulative placer gold production from creeks draining Thistle Mountain, including Ballarat, Thistle, Kirkman, Sparkling and Barker, is reported to be 104,604 ounces in the period 1913 to 2006 (compiled from Yukon Placer Mining Industry volumes published by Indian and Northern Affairs Canada).

Mark Fekete, PGeo, is the designated qualified person as defined in Section 1.2 in and for the purposes of National Instrument 43-101 responsible for the contents of this release. The analytical results stated above are historical in nature, have not been verified by Hinterland and are not considered reliable in the context of NI 43-101.

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