VANCOUVER, BRITISH COLUMBIA (TSX VENTURE: TRX) is pleased to
announce that it has signed the following definitive agreements
(the "Definitive Agreements") in furtherance of its previously
disclosed letter agreement (the "Letter Agreement") dated May 22,
2008, in respect of a credit agreement (the "Credit Agreement") and
an option agreement (the "Option Agreement") between Terrane and
its majority shareholder, Goldcorp Inc. ("Goldcorp") (TSX: G)(NYSE:
GG), for the commercial development of its 100%-owned Mt. Milligan
copper-gold project (the "Mt. Milligan Project") in British
Columbia, Canada:
(a) the Credit Agreement dated July 8, 2008, among Terrane as
borrower, Goldcorp as guarantor, BMO Capital Markets as lead
arranger and sole bookrunner, and the Bank of Montreal as
administrative agent and lender; and
(b) the Option Agreement dated July 8, 2008, between Terrane and
Goldcorp.
Under the terms of the Credit Agreement, Goldcorp will guarantee
an 18-month, non-revolving term credit facility of up to $40
million, or the US dollar equivalent, to further advance Terrane's
long lead-time capital equipment procurement program in support of
the construction of an open pit mine and 60,000 tonnes per day
process plant at the Mt. Milligan Project. Advances under the
Credit Agreement are subject to satisfaction of certain conditions
precedent contained therein.
The Option Agreement provides Goldcorp with a one-time option
(the "Option") to convert its fully diluted in-the-money equity
interest in Terrane into a participating joint venture interest in
the Mt. Milligan Project. The Option can only be exercised during
the term of the Credit Agreement and, then, only if Goldcorp's
resulting joint venture interest in the Mt. Milligan Project will
be greater than 30% and is also subject to a 60% maximum limit per
below. Upon exercise of the Option, and subject to other terms and
conditions, Goldcorp's 240 million convertible preferred shares in
the capital of Terrane would be cancelled upon:
(i) the transfer (the "Conversion") to Goldcorp of the
percentage ownership of the Mt. Milligan Project (the "Converted
Interest") equal to Goldcorp's percentage equity interest in the
share capital of Terrane at the time of Conversion multiplied by
the ratio of the book value of the Mt. Milligan Project to the book
value of all of Terrane's assets taken as a whole, up to a maximum
Converted Interest percentage of 60%; and
(ii) if, at the time of Conversion, Goldcorp's Converted
Interest would otherwise be greater than 60% but for the maximum
limit of 60%, then such amount of Goldcorp's shareholdings that
would exceed the 60% maximum shall be converted from preferred
shares to common shares of Terrane, if they have not otherwise
already been converted.
If the Option Agreement is exercised, the parties will develop
and operate the Mt. Milligan Project under a joint operating
agreement as set out pursuant to the Option Agreement. The party
holding the majority joint venture participating interest in the
Project will be the operator.
The Letter Agreement and Definitive Agreements are subject to
the prior approval of the TSX Venture Exchange and the shareholders
of Terrane. Terrane will call a special meeting (the "Special
Meeting") of its shareholders in order to seek such approval for
August 8, 2008. The Definitive Agreements, together with Terrane's
Special Meeting materials, will be filed shortly by Terrane on
SEDAR.
About Terrane
Terrane Metals Corp. is an exploration and mine development
company focused on the development of the Mt. Milligan copper-gold
and Berg copper-molybdenum-silver projects in British Columbia,
Canada. Goldcorp owns approximately a 58% equity interest in
Terrane on a fully diluted basis.
TERRANE METALS CORP.
Robert Pease, P.Geo, FGAC, President and CEO
Cautionary Note Regarding Forward Looking Statements
Except for the statements of historical fact contained herein,
the information presented in this news release (the "News Release")
constitutes "forward-looking statements" as such term is used in
applicable Canadian laws. These statements relate to analyses and
other information that are based on forecasts of future results,
estimates of amounts not yet determinable and assumptions of
management. In particular, statements concerning "Mineral Resource"
and "Mineral Reserve" estimates should be viewed as forward-looking
statements to the extent that they involve estimates of the
mineralization that will be encountered if the property is
developed. Any statements that express or involve discussions with
respect to predictions, expectations, beliefs, plans, projections,
objectives, assumptions or future events or performance (often, but
not always, using words or phrases such as "expects" or "does not
expect", "is expected", "anticipates" or "does not anticipate",
"plans, "estimates" or "intends", or stating that certain actions,
events or results "may", "could", "would", "might" or "will" be
taken, occur or be achieved) are not statements of historical fact
and should be viewed as "forward-looking statements". Such forward
looking statements, including but not limited to, those with
respect to the price of metals, the amount of estimated
mineralization and of contained metals and the timing of and
possible outcome of pending economic evaluations and other factors
and events described in this News Release, involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of Terrane to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements.
Such risks and other factors include, among others, the actual
results of exploration activities; variations in the underlying
assumptions associated with the estimation or realization of
Mineral Resources and Mineral Reserves, the conclusions of economic
evaluations and possible variations in ore grade or recovery rates;
costs and timing of the development of new deposits; availability
of capital to fund programs and the resulting dilution caused by
the raising of capital through the sale of shares; accidents,
labour disputes and other risks of the mining industry including
without limitation those associated with the environment, delays in
obtaining governmental approvals, permits or financing or in the
completion of development or construction activities, title
disputes or claims limitations on insurance coverage. Although
Terrane has attempted to identify important factors that could
cause actual actions, events or results to differ materially from
those described in forward-looking statements, there may be other
factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that
such statements will prove to be accurate as actual results and
future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward-looking statements contained in this News
Release and in any document referred to in this News Release.
Forward looking statements are made based on management's
beliefs, estimates and opinions on the date the statements are made
and Terrane undertakes no obligation to update forward-looking
statements if these beliefs, estimates and opinions or other
circumstances should change, except as required by applicable
law.
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release.
Contacts: Terrane Metals Corp. Rob Pease President and CEO (604)
681-9930 or Toll Free: 1-866-681-9930 Terrane Metals Corp. Ryan
King Investor Relations (604) 681-9930 or Toll Free: 1-866-681-9930
Website: www.terranemetals.com