Esperance Minerals has entered into an agreement with three partners to earn up to 65% interest in each of the Chadine and Blagojev Kamen Projects in Serbia.

The agreement is with Singapore company Triton Metals International Pte Limited, UK company Triton Metals Limited and TUK’s wholly owned Serbian incorporated company, Murex Rudarstvo i Geologija.

The Chadine project is a base metals and gold project which was previously drilled by the Serbian Government prior to the 1990’s but has not been subject to systematic modern exploration other than limited geological and geochemical surveys by the project owners during the past 12 months.

Results to date indicate that the Chadine Project has 20 kilometers long target zone with potential to host massive sulphide copper, zinc, lead and gold deposits warranting further exploration such as geophysical surveying, mapping, geochemical surveys and drilling.

The Blagojev Kamen project is located 6 kilometers west of the giant Majdanpek porphyry copper deposit and mining area. A 17 kilometers long shear zone lies within the 51 square kilometers tenement and hosts historic high grade gold mines. The owners’ current programs have confirmed significant exploration potential around the old mine workings, particularly at a mine called Grabova Reka North.

Esperance will make a non refundable advance of USD 250,000 to TUK to fund an 800 meters due diligence drilling program at BK. The program will involve twinning two historical holes at Grabova Reka North and drilling one new hole orthogonal to the twinned holes to better define the orientation of any mineralization. Following this Esperance can elect to proceed with the agreement or withdraw.

The project owners have advised Esperance that a rig has been contracted to conduct this program with drilling schedule to commence in early December and assay results expected in February 2012.

The agreement is a three stage process with Esperance having the right to proceed at the end of each successive stage, at its sole election. Under Stage 1 ESM will fund a 5,000m drilling program and contribute an additional AUD 500,000 towards the current exploration program and reimburse the owners USD 200,000 in prior expenses to earn 12.5% interest in both projects.

In Stage 2 ESM will move to 50% interest in both projects by spending an additional USD 5 million on the projects and issuing TMI with 40 million shares in ESM and 10 million 20 cent options exercisable on or before December 31st 2014. In Stage 3 ESM can increase its interest by an additional 15% of each project by completing a Definitive Feasibility Study.

Upon completion of a DFS for a project ESM then has the option to acquire the outstanding 35% of that project at a 20% discount to the DFS NPV payable 50% in cash and 50% in script. The interests obtained by Esperance will initially comprise equity in TUK, although this could change to equity in a holding entity for a project during or at the end of Stage 3 if the interests as they apply to each project are not aligned.

(Sourced from www.proactiveinvestors.com.au)