Talon Metals Provides Update on Discussions with Saber Energy
Mar 24, 2009
Road Town, Tortola, British Virgin Islands (Mar 24, 2009) - Talon Metals Corp., (“Talon” or the “Company”) (TSX: TLO) today announces that it has agreed to a 30 day extension on the maturity date of the $6 million loan Talon has made to Saber Energy Corp. (“Saber”) as part of the binding Heads of Agreement entered into by Saber and Talon on September 25, 2008 (the “Heads of Agreement”). The original maturity date of the loan was March 24, 2009 and the loan will not be repaid on this date. In addition, Talon's due diligence review of Saber regarding a potential merger of the two companies remains ongoing.
Talon currently expects its discussions with Saber regarding the loan to be concluded in about 30 days, or on or before April 24, 2009. The Company will update shareholders when the discussions are concluded. In the event that the discussions do not result in a further extension to the loan and the interest earned being agreed upon, the loan would become immediately due.
“Talon's due diligence on Saber is not yet completed and Saber has some important work underway at present, which, if successful, has the potential to increase the value of Saber's CBM properties in Botswana, and accordingly would bring value to all shareholders,” said Mr. Stuart Comline, President and CEO of Talon.
Talon's $6 million loan to Saber is secured against Saber's assets which include its land licenses in Botswana and other assets. Currently Talon's management and auditors are establishing an appropriate valuation for the loan in light of the fact that Talon will be reporting its audited financial results for 2008 this month.
Interest on the loan is currently payable at a rate of 18% per annum. Talon will also receive 3 million common share purchase warrants of Saber as part of the Heads of Agreement.
Saber is a private coal bed methane (“CBM”) exploration company focused on developing a CBM and shale gas field in the Karoo Basin in Botswana, Africa. Saber has over 90 drill holes with wells that have been drilled into the coal seams which host the CBM. Preliminary stage dewatering and pumping of gas is in progress and test work on gas flows and other characteristics of the coal and gas are underway. This proposed transaction with Saber was entered in to in order to realize Talon's goal to participate in a large project of merit, a strategic undertaking that has been underway since mid-2007.
In addition, Talon is continuing to investigate other opportunities and is currently undertaking due diligence reviews on a number of such opportunities that have been identified in the Company's search for new resource projects.
Talon is a TSX-listed company focused on the acquisition, exploration and advancement of high quality resource projects. The Company has a well-qualified exploration and management team with extensive experience in exploration and project management.
Talon has a treasury of approximately CDN$5 million and holds 4,935,500 common shares of Brazauro Resources Corporation (TSX-V:BZO), and 2,450,000 common shares in Beadell Resources Limited (ASX:BDR). Talon has 27,054,222 common shares outstanding.
For additional information on Talon please visit the Talon's website at www.talonmetals.com or contact: