Mount Pearl, NL, Canada: Cornerstone Capital Resources Inc. ("Cornerstone") (TSXV-CGP) (F-GWN) (B-GWN) (OTC-CTNXF) and Solomon Gold Plc ("Solomon Gold") (AIM code: SOLG) announce that they have signed a binding letter of intent (LOI) outlining the terms of an option/joint venture arrangement for Cornerstone's 100% owned 5,000 hectare Cascabel gold-copper-silver property in northern Ecuador. Cascabel is one of two new high potential projects acquired by Cornerstone in Ecuador during 2011.

Under the terms of the LOI, Solomon Gold has the ability to earn an initial 65% interest in the Cascabel property by:

(1) making an initial CAD$200,000 private placement in Cornerstone common shares based on the TSXV 30 day volume weighted average price ("VWAP") within 30 days of the execution of a definitive option agreement embodying the terms of the LOI;

(2) spending US$7.8 million over 4 years (including US$800,000 in the first year if drilling commences);

(3) within 60 days of the commencement of drilling on Cascabel, making a private placement in Cornerstone shares of CAD$150,000 and issuing Solomon Gold ordinary (i.e., common) shares to Cornerstone with a value equal to CAD$150,000 (both based on 30 day VWAP); and

(4) making a final private placement in shares of Cornerstone of CAD$500,000 priced at 30 day VWAP plus 20% on or before the 4th anniversary of the execution of the definitive option agreement.

All private placements shall be subject to Exchange approval, and proceeds of all private placements will be used for general corporate purposes.

Prior to Solomon Gold earning its initial 65% interest, Cornerstone will be the operator of the property on a cost plus 10% basis, and Solomon Gold will direct the technical program.

Following Solomon Gold's earning of its initial 65% interest, Cornerstone and Solomon Gold will enter into a joint venture and will fund their respective proportionate shares of ongoing expenditures and be subject to dilution according to a standard formula. After the entering into of the joint venture, Solomon Gold will have the option for one year to elect to earn an additional 20% interest in Cascabel by funding exploration towards the completion of a National Instrument 43-101 ("NI 43-101") bankable feasibility study ("BFS") within 18 months of making such election. The cost to Solomon Gold of the BFS is capped at US$20 million, after which the parties will contribute on a pro-rata basis. If Solomon Gold timeously exercises its right to earn the additional 20% interest, then any amounts spent by Cornerstone prior to that exercise and post Solomon Gold earning its initial 65% interest will be reimbursed to Cornerstone by Solomon Gold at 200% of expenditures incurred. Within 90 days of completion of the BFS, subject to Exchange approval, Solomon Gold shall issue to Cornerstone, at no cost to Cornerstone, ordinary (common) shares of Solomon Gold equal to 2% of the ordinary (common) shares of Solomon Gold then issued and outstanding. If Cornerstone fails to fund its proportionate share of ongoing expenditures and its interest is diluted below 10%, such interest will be converted to a 1% assignable Net Smelter Return ("NSR") on the property. Solomon Gold may purchase the NSR from Cornerstone on the following terms: Half of the NSR for US$1.5 million within 90 days following completion of the BFS; and the remaining half of the NSR for US$2.0 million within 90 days following a production decision.

"We are very pleased to have Solomon Gold as our partner on the Cascabel project, their technical team brings solid expertise gained in similar geological environments, and both companies have complementary skills that will benefit the project," said Brooke Macdonald, Cornerstone's President & CEO. "This partnership highlights Cornerstone's project generator business model -- finding and acquiring high potential properties, and then securing a cost and risk sharing partnership with a value-added partner such as Solomon, and in the case of Cascabel doing so within one year of property acquisition."

Malcolm Norris, CEO of Solomon, said, "This is an exciting time for Solomon Gold. The Cascabel property demonstrates all the features that we would like to see in an early stage gold-copper porphyry project, and to partner with a highly respected company such as Cornerstone enhances the probability of success. We will commence field work in May and move the project towards the drilling stage as soon as possible."

About Cascabel
The Cascabel property is located approximately 120 km north of Quito and 20 km south of the Colombian border. Access is very good via a paved road from the provincial capital city of Ibarra to San Lorenzo city, on the Pacific coast, and secondary gravel roads to the central part of the 50 km² property. An environmental license for the initial exploration phase was granted by the Ministry of Environment on July 12, 2011. Exploration work including geology, geochemistry, geophysics and hand-dug trenching and pitting, is allowed for a 4-year period under this environmental license. Cornerstone has complied with all regulations on this project and no further authorization is necessary to initiate field work.

Maps showing the geology and exploration results to date may be viewed at www.cornerstoneresources.com. Highlights of assay results for the 179 rock samples (grabs and representative rock chips) announced on September 13, 2011 show that precious and base metals are anomalous over most of the property area:

Gold	>0.1 g/t	>0.5 g/t	Max. value	Average of all values
	93 samples (52%)	26 samples (14%)	5.93 g/t	0.32 g/t
Silver	>5.0 g/t	>30.0 g/t	Max. value	Average of all values
	43 samples (24%)	10 samples (5%)	150.0 g/t	7.25 g/t
Copper	>0.01%	>0.1%	Max. value	Average of all values
	144 samples (80%)	36 samples (20%)	3.23%	0.13%

Free gold has been identified by panning in most of the streams of the area (49 pan concentrates out of 64 show the presence of gold) with higher amounts of gold grains (10-30) concentrated in the headwaters of the Rio Parambas, Rio Cachaco and Rio Cristal. Some of the streams have not yet been surveyed and/or followed up.

Regional geology and mineralization
The Cascabel area is underlain by Upper Cretaceous sedimentary rocks which are overlain by Oligocene to Miocene andesitic flows and breccias. These units are intruded by Miocene age batholiths and stocks of granodiorite and diorite. Major regional tectonic structures in the area strike northeast. One such structure, the Apuela regional fault, transects the southeast part of the Cascabel property. Several mineral prospects which are hosted in the same geological belt, have been identified in the Cascabel district including the Chical (Au-Ag) and Rio Amarillo (Au-Ag-Cu) epithermal prospects located 12 km to the northwest and 12 km to the south of the property respectively. Cascabel is located upstream from an extensive alluvial gold district, Playa de Oro, located 50 km to the west. The Junin porphyry copper-molybdenum deposit (undeveloped NI 43-101 compliant inferred resource of 982 Mt @ 0.89% Cu, 0.04% Mo and 1.9 g/t Ag) lies 65 km to the southwest.

Qualified Person
Yvan Crepeau, M.Ba., P.Geo, President of Cornerstone Ecuador SA and a qualified person in accordance with National Instrument 43-101, is responsible for the Cascabel exploration program and has reviewed and approved the technical information contained in this news release.

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.