Full Metal Zinc Signs Binding Letter of Intent to Acquire the San Andres Silver Project and Mill, Durango, Mexico and Undertakes

Full Metal Zinc Signs Binding Letter of Intent to Acquire the San Andres Silver 
Project and Mill, Durango, Mexico and Undertakes up to
a $1,000,000 Financing 
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 08/29/13 -- Full
Metal Zinc Ltd. (TSX VENTURE:FZ) (the "Company") is pleased to
announce that it has signed a binding letter of intent with Minera
ISP, S. de R.L. de C.V. and certain of its affiliates including,
Inversiones Mineras ISP San Andres, S. de R.L. de C.V., Operaciones
Minera ISP San Andres, S. de R.L. de C.V. and Servicios Mineros ISP,
S. de R.L. de C.V. (collectively the "Vendors") to acquire 100% of
the San Andres de la Sierra mine and processing facilities as well as
the exploration land package around the area of historical operations
(the "San Andres Property"). The transaction is subject to a 60 day
due diligence period following which a definitive agreement may be
concluded between the Company and Vendors.  
The 5,757 hectare San Andres Property, located in the Sierra Madre
Occidental of Durango State, Mexico, reportedly produced 17 million
ounces of silver from multiple mines between 1890 and 1915 through
the on-site direct smelting of high-grade narrow veins. (This
historic production figure is from historic Mexican Government
Records, has not been independently verified). Mining ceased due to
the Mexican revolution and the San Andres Property lay dormant until
the Vendors began work in 2006.  
From 2008 to 2012 the Vendors consolidated the land package around
the historic operations, drilled 13 short core holes and assembled a
300 tonne per day mill/concentrator and tailings facility at the San
Andres Property to process dump material, investing over $6 million
in the process. The majority of the San Andres Property has not
received modern surface exploration or diamond drilling. In addition
to fully functional camp buildings located at site the San Andres
Property lies within six km of overhead power and is road accessible. 
The San Andres Property is located eight km east, and potentially
part of the same metallogenic system as Chesapeake Gold's Metates
Deposit (Reserves 18.5M oz. Au, 526M oz. Ag, 4.2B lbs. Zn - Source:
Chesapeake Gold Corp. March 18, 2013 Report titled "Metates
Gold-Silver Project NI 43-101 Technical Report Preliminary
Feasibility Study Durango, Mexico"). It is also located six
kilometers south of the San Miguel del Cantil Mine, a privately
owned, 1,200 tonne per day high-grade underground gold-silver mine. 
The San Andres Property is underlain by hornfels altered Mesozoic
sedimentary rocks, intruded by a multiphase Eocene diorite intrusive
unit, possibly syngenetic with overlying Tertiary volcanics that host
the adjacent San Miguel mine. Multiple, subhorizontal stacked
silver-lead-zinc +/- gold/copper veins have been identified and were
historically mined over a one kilometer long trend. Mineralization
identified to-date is hosted within both the hornfels and intrusive
units. 
Historic Minera ISP drilling 


 
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                 From         To      Width         Ag                    
Hole              (m)        (m)        (m)      (g/t)   Vein/Structure   
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BDSA-1          75.85      75.95       0.10     1546.8   Del Bajo         
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BDSA-2           0.00     137.75     137.75       31.6   El Gordo         
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inc              3.15      23.20      20.05       48.9   El Gordo         
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BDSA-3          23.95      24.50       0.55      806.7   Tapia Colorada   
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and            148.00     148.20       0.20     1577.7   De en Medio      
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BDSA-4         176.10     225.15      49.05       62.1   Intrusives       
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inc            196.25     196.55       0.30     1548.1   Intrusives       
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and            223.90     225.15       1.25     1074.7   Intrusives       
--------------------------------------------------------------------------
BDSA-6          69.07      69.32       0.25      821.1   Del Bajo         
--------------------------------------------------------------------------
BDSA-8         127.00     127.20       0.20      489.1   Del Bajo         
--------------------------------------------------------------------------
BDSA-11        175.70     175.95       0.25      848.8   Inclinada        
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BDSA-12         55.40      55.50       0.10      898.2   Esperanza        
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and            145.30     145.50       0.20      925.4   Del Bajo         
--------------------------------------------------------------------------
BDSA-13        194.05     194.35       0.30      349.2   Intrusive Contact
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Subject to receiving regulatory and any required shareholder approval
for the transaction, the Company will acquire 100% of the San Andres
Property and mining/processing infrastructure by issuing 10 million
shares and making a one-time cash payment of US$260,000 (US$25,000 of
which was paid upon signing of the binding letter of intent). The
Vendors will retain a 2% NSR on land currently unencumbered by any
royalty and, in addition, any existing royalty on the San Andres
Property that expires, is extinguished, paid into or terminated will
be replaced with a similar 2% NSR in favour of the Vendors. The
Company will have the right to acquire half this royalty (1% NSR) at
any time by making a one-time payment of US$5 million. 
So long as the Vendors' interest remains above 5%, the Vendors will
be granted a right to pre-emptively participate in future financings
to maintain their percentage interest in the Company; and nominate
one candidate to the Board of Directors of the Company at each
meeting of shareholders at which directors are to be elected. 
Photographs of the San Andres Property and mill facilities as well as
cross-sections and maps are available to view on the Company's
website www.fullmetalzinc.com. 
The Company plans to conduct work sufficient to complete a NI43-101
technical report on the San Andres Property during a 60 day due
diligence period.  
In conjunction with the aforementioned acquisition, the Company will
undertake a non-brokered financing (the "Financing") of up to
$1million involving the issuance of up to 20,000,000 units at a price
of $0.05 per unit, with each unit consisting of one common share and
one half of one common share purchase warrant exercisable at a price
of $0.10 for two years. The proceeds of the financing will be used
primarily to pay the cash component of the acquisition cost as well
as technical due diligence and legal expenses in conjunction with
transaction. The remaining proceeds will be applied to the initial
exploration efforts by the Company on the San Andres Property as well
as general working capital. 
The contents of this news release have been reviewed and approved by
Robert McLeod, P.Geo., Director of Full Metal Zinc Ltd. Mr. McLeod is
a Qualified Person as defined in National Instrument 43-101. 
ON BEHALF OF THE BOARD OF DIRECTORS 
Michael Williams, President & CEO  
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release. 
Some statements in this news release contain forward-looking
information, including without limitation statements as to planned
expenditures and exploration programs. These statements address
future events and conditions and, as such, involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements to be materially different from
any future results, performance or achievements expressed or implied
by the statements. Such factors include without limitation the
completion of planned expenditures, the ability to complete
exploration programs on schedule and the success of exploration
programs.
Contacts:
Full Metal Zinc Ltd.
Michael Williams
President & CEO
(604) 484-7855
www.fullmetalzinc.com
 
 
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