Great Western Minerals Announces Option and Joint Venture With Star Minerals on Hoidas Lake Project

SASKATOON, SK--(Marketwired - Dec 4, 2013) - Great Western Minerals Group Ltd. ("GWMG" or the "Company") (TSX VENTURE: GWG) (OTCQX: GWMGF), a leader in the manufacture and supply of rare earth element-based metals and metal alloys and holder of a low cost, high-grade critical rare earth asset (the "Steenkampskraal Project" or "SKK"), announced today that it entered into an option and joint venture agreement with Star Minerals Group Ltd. (TSX VENTURE: SUV) ("Star") on the Hoidas Lake Project, an area comprised of fourteen mineral claims totaling approximately 12,490 hectares and related property in northern Saskatchewan. As previously announced, GWMG and Star entered into a letter of intent with respect to the joint venture agreement on June 4, 2013.

Marc LeVier, GWMG President and CEO, commented, "This agreement allows us to continue to focus our resources and time on our SKK project, while still moving the Hoidas Lake project forward without committing capital."

Star has been granted the option, segregated into two tranches, to acquire from GWMG up to a 51% participating interest in the Hoidas Lake Project. The exercise of the first option to acquire a 25% interest is contingent on Star completing an NI 43-101 compliant preliminary economic assessment in respect of the Hoidas Lake Project within two years. 

Star has also been granted the option to acquire an additional 26% participating interest, contingent on completing an NI 43-101 compliant feasibility study in respect of the Hoidas Lake Project during the four year period after exercising the first option. All costs and expenses incurred in connection with either option shall be paid by Star. 

The obligations of the parties pursuant to the option and joint venture agreement are subject to the satisfaction of certain conditions precedent, including regulatory approval on the part of Star and bondholder approval on the part of GWMG, which the parties intend to obtain in due course. 

GWMG also announced today that George Ireland has resigned as a Director of the Company. Mr. Ireland has served as a Director since April 2012.

Mr. Ireland stated, "It has been a pleasure to work with the entire Great Western team and my fellow Board members. I look forward to following the Company's progress from the perspective of an investor in both the equity and the debt as they move forward with their business plan to become a leader in the rare earth sector."