TORONTO, ONTARIO, March 29, 2012 -- Rainbow Resources Inc. (TSX VENTURE: RBW) ("Rainbow" or the "Company") is very pleased to announce that it has entered into an agreement with Greencastle Resources Ltd. ("Greencastle") (TSX VENTURE: VGN) for exploration of Greencastle's Jewel Ridge Gold Property near Eureka, Nevada, in the heart of a major gold producing district.
Jewel Ridge is located on the south end of Nevada's prolific Battle Mountain - Eureka Trend, along strike and contiguous to Barrick Gold's two-million ounce Archimedes/Ruby Hill Mine to the north and Timberline Resources' advanced-stage Lookout Mountain Project to the south.
Jewel Ridge contains several historic small open-pit gold mines which align along a north-south trending stratigraphic contact of Lower Paleozoic sedimentary rocks as well as several other gold mineralized zones with a variety of structural and lithological controls. One of Rainbow's initial priorities will be to follow-up on encouraging results from Greencastle's previous drilling including 2.1 g/t Au over 39.6 metres (94.5 m to 134.1 m) at the old Hamburg Mine workings.
The property consists of 96 unpatented lode mining claims and 11 patented claims covering approximately 1,510 acres.
"Combined with our flagship Big Strike Project in the West Kootenay region of southeast British Columbia, this strategic entry into Nevada gives Rainbow year-round drilling capability and exciting additional opportunities to build value for our shareholders," stated Rainbow President David W. Johnston. "Gold mineralization at Jewel Ridge is present in a variety of styles over a wide area and we look forward to unlocking the value of this asset. We're also continuing our due diligence with respect to possibly adding a second Nevada property to our package."
"We are delighted to enter into this agreement with Rainbow," explained Greencastle CEO Anthony Roodenburg. "They have a strong technical team and an aggressive approach to exploration. We're looking forward to this partnership on Jewel Ridge."
Rainbow can earn a 60% interest in the Jewel Ridge Property by paying Greencastle $250,000 cash, issuing 1,500,000 shares of Rainbow and spending $4.5 million over 4 years. On earning a 60% interest in the property, Rainbow can elect to increase its interest to 75% by advancing the property to the stage of a bankable feasibility study. A finder's fee may be payable in connection with this transaction.
Rainbow looks forward to releasing more details regarding Jewel Ridge and its immediate exploration plans for the property upon further review by Moose Mountain Technical Services, Rainbow's resource consultants.
Rainbow's disclosure of a technical or scientific nature in this news release has been reviewed and approved by Mr. Robert Morris, P.Geo., of Moose Mountain Technical Services, who serves as a Qualified Person under the definition of National Instrument 43-101.
Rainbow's shares are listed for trading on the TSX Venture Exchange under the symbol
RBW.V. Rainbow currently has 33,508,163 common shares issued and outstanding.
Caution Regarding Forward-Looking Information
This news release includes certain information that may constitute "forward-looking information" under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements about strategic plans, future work programs and objectives and expected results from such work programs. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information and the risks identified in the Company's continuous disclosure record. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
For further information: David Johnston (403) 701-2781.
Visit our website at www.RainbowResourcesInc.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.