La Negra Acquisition Closed
May 23, 2006
- La Negra Acquisition Closed
- Work To Commence Immediately
- Notice Of Accelerated Warrant Expiry
May 23, 2006
LA NEGRA MINE
Aurcana Corporation ("Aurcana" or the "Company") is pleased to announce that it has closed an acquisition with Servicios Industriales Penoles, S.A. de C.V. ("Penoles") on the La Negra silver-zinc-copper-lead mine ("La Negra") located in Mexico, as contained in the Company's February 6, 2006 news release. With the acquisition of La Negra, Aurcana will move towards becoming a producer of silver and base metals in the near future, taking advantage of the current strength in the metals market.
The next steps for Aurcana will be to work with its partner Reyna Mining and Engineering, S.A. de C.V. ("Reyna") to confirm the historical reserves at La Negra outlined by Penoles in 2000 and to prepare the mine and 800 tonne per day mill for resumption of production. Reyna's comprehensive work over the last few months has consisted of detailed engineering on both the mine and mill and should allow for an orderly start up.
Aurcana will provide additional updates on the progress of La Negra as more work is completed.
In a news release dated April 17, 2006 Aurcana announced that it had completed a non-brokered private placement of 22,350,000 units at a price of CDN$0.20 per unit. Each unit consisted of one common share and one half of one common share purchase warrant (the "Warrants"). The Warrants were exercisable at a price of CDN$0.25 per common share and had a term of one year provided that if the closing price of the Company's shares as traded on the TSX Venture Exchange remained at or above $0.45 per share for 20 consecutive trading days, the Company would have the right to accelerate the expiry of the Warrants upon giving 30 days notice to the holders thereof ("Accelerated Expiry").
As at the close of trading on May 15, 2006 the Company's shares had traded 20 consecutive days at or above $0.45 per share and the Accelerated Expiry of the Warrants was triggered. Effective today, the Warrant Expiry Date has been advanced to the close of business June 23, 2006. Any Warrants that have not been exercised on or before the Warrant Expiry Date will have been deemed cancelled.
Should all of the Warrants be exercised, the Company will receive proceeds of approximately $3.06 million and will have approximately 66.3 million shares issued and outstanding. Funds received will be used to advance development of La Negra as well as to provide general working capital.
ON BEHALF OF THE BOARD OF DIRECTORS OF
"Ken Booth", President
For further information, please contact: Ken Booth, President
Phone: (604) 331-9333
Web site: www.aurcana.com
The statements made in this News Release may contain certain forward-looking statements. Actual events or results may differ from the Company's expectations. Certain risk factors may also affect the actual results achieved by the Company.The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy and accuracy of this Release.