Talon Metals Announces Extension on Loan to Saber Energy on Positive Corporate Developments
Apr 24, 2009
Road Town, Tortola, British Virgin Islands (Apr 24, 2009) - Talon Metals Corp., (“Talon” or the “Company”) (TSX: TLO) today announces a further six month extension on the maturity date of Talon's $6 million loan to Saber Energy Corp (“Saber”). The revised maturity date of the loan is October 31, 2009. This loan is part of the binding Heads of Agreement entered into by Saber and Talon on September 25, 2008 (the “Heads of Agreement”) regarding a potential merger of the two companies.
This second extension of the loan maturity date is based on today's news that Saber has signed a Heads of Agreement with Tlou Energy (“Tlou”) to conduct further exploration on Saber's Coal Bed Methane (“CBM”) properties in Botswana. Tlou is a 50-50 joint venture between Mitchell Energy Group (“Mitchell”) and Walcot Capital (“Walcot”). Mitchell and Walcot are leaders in exploration and development of CBM projects in Australia. These exploration programs will be funded to the “proof of concept” stage solely by Tlou. In return, Tlou will earn an ownership position in various companies that hold the Botswana land licences.
“We are pleased that Saber has a strategic joint venture partner that will fund exploration of its CBM properties in Botswana to proof of concept and believe that, with Tlou's expertise, Saber's exploration program will be enhanced,” said Mr. Stuart Comline, President and CEO of Talon.”
Also under the loan extension agreement, Saber is required to make principal repayments should it raise funds through the sale of assets or financing activities prior to the loan maturity date. Interest on the loan will be payable at a rate of 18% per annum for the first three months of the loan extension period, and at 25% per annum on the second three months of the loan extension period. The loan is secured against Saber's assets; namely its land licenses in Botswana and equipment.
In addition, Talon will receive three million common share purchase warrants of Saber under the loan extension agreement. These warrants are in addition to the three million warrants Talon received under the 2008 Heads of Agreement.
Talon's exclusive right to enter into a merger with Saber has also been extended until April 30, 2010. Talon's due diligence review of Saber regarding a potential merger of the two companies remains ongoing.
Saber is a private CBM exploration company focused on developing a CBM and shale gas field in the Karoo Basin in Botswana, Africa.
In addition, Talon is continuing to investigate other acquisition opportunities in the resources sector. Several due diligence reviews are currently underway on significant strategic resource opportunities.
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$7 million and holds 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:
About Tlou Energy
Tlou Energy is a 50-50 joint venture between Mitchell Energy Group and Walcot Capital. Together the two companies provide a wealth of technical, drilling, operating and commercial experience in CBM projects globally.
Mitchell Energy Group was formed from Mitchell Drilling, a specialized drilling company whose surface to in-seam drilling technology helped revolutionize the Australian CBM industry. Today Mitchell Energy Group is an integrated contractor offering a full range of drilling services on a global basis. www.mitchellenergygroup.com
Walcot Capital is a Brisbane based private venture capital business specializing in energy investment. Walcot Capital's capabilities extend across technical, commercial and legal fields of the energy sector with its principals having founded and developed successful CBM companies in both Australia and New Zealand.
This news release contains forward-looking information. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding potential mineralization, the depth of the mineralization and the CompanyÍs exploration plans and objectives) are forward-looking information. This forward-looking information reflects the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking information is subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things, risks related to the exploration stage of the CompanyÍs properties, the possibility that future exploration results will not be consistent with the CompanyÍs expectations (including identifying additional and/or deeper mineralization), changes in the price of iron ore, changes in equity markets, political developments in Brazil, uncertainties relating to the availability and costs of financing needed in the future, changes to regulations affecting the CompanyÍs activities, delays in obtaining or failures to obtain required regulatory approvals, the uncertainties involved in interpreting exploration results and other geological data and the other risks involved in the mineral exploration business. Forward-looking information speaks only as of the date on which it is provided and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of buy . Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
The mineral resource figure disclosed in this news release is an estimate and no assurances can be given that the indicated levels of iron will be produced. Such estimate is an expression of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. While the Company believes that the mineral resource estimate disclosed in this news release is well established, by their nature mineral resource estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such estimate is inaccurate or reduced in the future, this could have a material adverse impact on the Company.
Mineral resources are not mineral reserves and do not have demonstrated economic viability. Inferred mineral resources are estimated on limited information not sufficient to verify geological and grade continuity or to allow technical and economic parameters to be applied. Inferred mineral resources are too speculative geologically to have economic considerations applied to them to enable them to be categorized as mineral reserves. There is no certainty that mineral resources can be upgraded to mineral reserves through continued exploration.