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HOUSTON LAKE MINING INC. (HLM-CDNX)
PRESS RELEASE
Proposed
$300,000 Financing for Tib Lake Palladium Project Drilling September 19, 2001: Sudbury, Ontario - Houston Lake Mining Inc. (CDNX:HLM, "Houston Lake") is pleased to announce that the Company has received a positive response from potential investors for a proposed $300,000 non-brokered Private Placement. The funds are earmarked for a 1500 metre (3280 foot) drill program on Houston Lake’s 100 percent-owned, 1632 hectare (4030 acre) Tib Lake property which is located in the Thunder Bay Mining District of NW Ontario. The property interest is subject to a 2.5 percent Net Smelter Royalty. Tenders are currently being prepared for the upcoming drill program which is expected to begin upon closing of the financing. The Company will issue 600,000 Units at a price of $0.50. Each Unit consists of one (1) flow-through common share and one half (½) purchase warrant. One full purchase warrant can be exercised at $0.60 for a period of one year. The Offering has a hold period of one year in Ontario and four months in Alberta and British Columbia and is contingent on regulatory approval. The financing utilizes Super Flow-through Shares which yield a tax write-off in excess of 100% of the investment. For instance, an investor at a top marginal tax rate in Ontario would incur an after tax cost of $0.215 per share. The Tib Lake property is located in the Lac Des Iles area just 15 km. (9 miles) from the Lac Des Iles palladium mine of North American Palladium Ltd. Resources at the Lac Des Iles mine at December 31, 2000 were estimated to be 145.6 million tonnes averaging 1.57 grams per tonne, containing 7.4 million ounces of palladium. The Tib Lake gabbro is the second largest intrusion of the Lac Des Iles suite of rocks and, as such, is a prime target for palladium-platinum-gold ("PGE") exploration. Globally, PGE deposits are restricted to large intrusions with high background values of PGE’s. Houston Lake identified palladium as a key commodity in 1997 and solidified its land position at Tib Lake by Spring of 1998 well in advance of most other PGE explorers. To date the Company has expended over $450,000 in programs of line-cutting, geophysics, geological mapping, trenching and stripping, and diamond drilling on the Tib Lake property. Last fall’s 1,037.6 metre (3,403.3 foot) diamond drilling program intersected a highlight of 22 metres (72.2 feet) of core length grading 1.456 g/t PGE’s (palladium + platinum + gold), 0.17% nickel and 0.15% copper under the Kuhner Occurrence. This intercept extended the economically significant palladium mineralization at the Kuhner Zone from 35 metres (100 feet) to a depth of 65 metres (213 feet). The Kuhner Zone appears to be widening with depth from relatively narrow surface showings. The Kuhner mineralization may also have been extended along strike for several hundred metres to a new palladium occurrence on the west bank of the East Dog River. The exploration program will seek to further define the PGE mineralization at the Kuhner Zone. Houston Lake commissioned Dr. Walter Peredery to review all previous data at Tib Lake. Dr. Peredery is eminently qualified to carry out such work through his extensive experience in nickel-copper-PGE mineralization with Inco Ltd. in the Sudbury area (Ontario) and Thompson Belt (Manitoba) and is well acquainted with Russian and South African PGE deposits and the Lac Des Iles area. Dr. Peredery states in his report: "It is now clear that the economically significant PGE mineralization is associated with the more mafic to ultramafic rock layers which are generally confined to the Lower Zone of the Tib Lake gabbro." If this is indeed the case then the 22 metres of core length intersected at the Kuhner Occurrence has an estimated true width of 20 metres. Dr. Peredery concludes: "…. it is surmised that deeper drilling will be closer to the source of the fluids, and by analogy to the Lac Des Iles complex, closer to the primitive rocks and higher PGE values. Utilization of concepts proposed here should improve the overall effectiveness of future exploration programs in the Tib Lake property. Further exploration work is highly recommended, as our indicators clearly demonstrate that there is an excellent potential of finding PGE mineralization. Persistent exploration work should lead to the discovery of a major PGE orebody in the Tib Lake property." Management believes that the outlook for palladium is bright for the following reasons: palladium prices have bottomed above $(US)400/oz, stricter environmental legislation for automotive emissions is slated over the next several years in North America and Europe, new promising applications in fuel cells are expected to increase future demand, and there is limited choices for substitution given the effectiveness of palladium over other metals. Houston Lake has granted incentive 300,000 stock options priced at $0.31 to directors and employees of the Company. Houston Lake is actively exploring for rare metals, platinum group metals and gold in northwestern Ontario. The common shares of Houston Lake Mining Inc. trade through the facilities of the Canadian Venture Exchange under the symbol HLM. Houston Lake Mining Inc. has a total of 14,798,695 common shares issued and outstanding exclusive of the proposed financing. For further information on all of the Company's projects, we invite you to visit us at www.houstonlakemining.com. For more information, please contact: E.
Grayme Anthony B.Sc., P. Geo., F.G.A.C., M. B.
A. The Canadian Venture Exchange has neither approved nor disapproved of the information contained herein. |