NEWS RELEASE
ECUADORIAN MINERALS CORPORATION
October 14, 1998
Trading: TSE.EMC
Ecuadorian Minerals Corporation ("EMC") is pleased to announce that it has executed the Option Agreement with Rio Tinto Mining and Exploration Ltd. ("Rio Tinto") for the Beroen gold/silver property in southwestern Ecuador pursuant to the previously announced Letter of Intent (see news release dated June 10, 1998).
Under the terms of the Option Agreement, EMC has an option to purchase a 100% interest in Rio Tinto's Canoas and Canoas 1 concessions together with Rio Tinto's rights in the previously existing joint venture agreement with EMC (collectively "the Property"). EMC must pay a total of US$2.5 million in cash and shares over a 4 year period, consisting of an initial payment of US$100,000 payable in EMC common shares upon execution of the Option Agreement (a total of 195,686 shares have been issued) and cash payments of US$250,000 after 12 months, US$350,000 after 24 months, US$800,000 after 36 months and a final option payment of US$1,000,000 after 48 months. In addition, a 2% NSR royalty will be payable to Rio Tinto upon commencement of commercial production from the Property. Together with EMC's existing 100%-held ground, EMC now has rights over a total of approximately 20 sq. km of mineral concessions at Beroen.
Located 50 km northeast of EMC's Gaby gold porphyry deposit, the consolidated property position covers an extensive, epithermal gold/silver system (the Beroen deposit) extending over a strike length of approximately 1.8 km, with a width of about 800m and which persists over 1,000 vertical meters. From work completed to date by Rio Tinto (who drilled only 3 of the 9 known mineralized zones) and EMC, it appears that the Beroen deposit may contain high-grade, bonanza-style gold/silver mineralization within veins, silicified zones and breccias together with bulk mineable precious metal mineralization of multi-million ounce potential hosted by a volcanic sequence.
Subject to the availability of financing, EMC intends to initiate an intensive exploration program on the Beroen property, including an initial drill program. This program will focus on the undrilled Minerva - Alejandra Zone where Rio Tinto's high grade gold/silver values from surface rock samples (up to 113 g/t gold and 541 g/t silver) indicate the potential for an extensive bonanza-style target. Nearby Rio Tinto drill holes have intersected high grade gold/silver mineralization, including intercepts starting at surface of 34.5m at 12.3 g/t gold and 109 g/t silver (LLP09) and 27m at 10.4 g/t gold and 103 g/t silver (LLP10).
Pursuant to the February, 1998 non-brokered private placement of 5.65 million units (each unit comprising one common share and one share purchase warrant), one of the placees has exercised 1.8 million warrants at Cdn$0.25 per warrant for total proceeds to EMC of Cdn$450,000. A total of 1.85 million warrants remain to be exercised at a price of Cdn$0.25 until February 6, 1999, Cdn$0.40 until February 6, 2000 and Cdn$0.60 until February 6, 2001.
Stephen J. Kay, President and CEO
The Toronto Stock Exchange neither approves nor disapproves the information contained in this News Release.
For additional information, contact Linda North at Tel: (602) 483-9932 or Fax: (602) 483-9926.