CHICAGO, June 28, 2005 (PRIMEZONE) -- American Steller Energy (Pink Sheets:AMRS) is pleased to report that it, through its 97%-owned Mexican subsidiary Amermin, has signed a joint venture agreement with Minas de Topago, S.A de C.V., a private Mexican Company, to acquire a 60% interest in the La Millonaria property, a gold and silver mining property situated near the town of Chinipas in the State of Chihuahua, Mexico.
The La Millonaria property consists of four mining concessions that total 875 hectares in area. The property is located in the Sierra Madre Occidental in an historic mining district. The property includes formerly producing gold mines. The State of Chihuahuas' Direccion General de Fomento Economico conducted a preliminary evaluation in 1993 of the waste dump material at the La Millonaria mine, concluding that approximately 27,000 tons of material is present with an average gold grade of 9.7 g/ton (0.283 oz/ton) and an average silver grade of 96.7 g/ton (2.82 oz/ton). Preliminary metallurgical testing by the Fomento Economico indicated that 50% to 70% of the gold present in the dump material is recoverable by conventional milling and flotation methods.
American Stellar will be the operator of the joint venture and will provide $450,000 in capital to the joint venture consisting of $100,000 in cash payments, of which $55,000 has already been paid, and $350,000 will be spent to purchase and refurbish a mill and mine infrastructure to process 75 tons per day in order to vest its 60% interest. All costs will be recouped before the joint venture revenue interest is initiated.
American Stellar Energy has recently commissioned a licensed geologist, capable of producing a NI43-101 report, which will provide a detailed description of our mining assets.
Mr. Francis Biscan Jr., President of American Stellar Energy stated, "We have added another very substantial property that we believe has the potential to generate cash flow in a relatively short to intermediate timeframe. We anticipate the ability to fund this joint venture over time using cash flow from our La Curitta operations. The report that we have initiated should help to demonstrate the magnitude of this property."
Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated. Technical complications which may arise could prevent the prompt implementation of any strategically significant plan(s) outlined above.