VANCOUVER, Aug. 28 /PRNewswire-FirstCall/ -- Mr. Thomas Hatton reports;
The Company is pleased to advise that it has recently extended its agreements regarding both the supply and sale of industrial minerals as previously announced.
The exclusive supply agreement with Teichert and Son Inc., a California corporation doing business as Teichert Aggregates, as was originally announced May 27, 2008, pertains to the exclusive distribution rights of certain minerals known as ilmenite and magnetite. Teichert produces ilmenite and magnetite as a by-product from its aggregate mining operations, and currently has an estimated 25,000 tons stored on-site in Central California.
These rights allow the Company to distribute and sell this product as a blast medium in the industrial abrasive industry in both Western U.S. and Canada. The term of the agreement is for a period of 5 years with an option for an additional 5 years, if agreeable by both parties. As part of the agreement, the Company is required to purchase a minimum tonnage per contract year in order to maintain fixed pricing terms.
The effective commencement date of production is dependent on the Company first obtaining California Air Regulation Board (CARB) approval for the use of these products as a blast medium and then establishing a drying, screening and bagging plant at a nearby location. In conjunction with Teichert, the Company has initiated the CARB test and the Company's management is negotiating with a U.S. company for a site on which to locate the drying and bagging facility.
The agreement for sale with R.A. Temple Inc., a California corporation, as was originally announced December 2, 2008, pertains to the sale of ilmenite and magnetite industrial minerals (the Product). The Product is to be sourced from the Company's location in Sacramento, California, under its exclusive supply agreement with Teichert and will be sold under the Company's Black Talon brand name.
Under the agreement Temple may purchase up to 7,000 tons of ilmenite and magnetite per annum, from the commencement date, on a pre-determined pricing framework for a period of five years. The commencement date of the first shipment was originally scheduled for no later April 1, 2009, and Gemco has attained commitment from Temple to extend the first shipment date from April 1, 2009 until such time that Gemco is scheduled to start production on or before December 1, 2009, which provides time to complete the California Air Regulation Board (CARB) standard approval for the use of this Product as a blast medium and to establish a drying, screening and bagging plant at a nearby location.
Further, on August 17, 2009, the Company entered into an equipment sales agreement with Tash Industrial Design Inc., whereby Tash has designed, and will supply a sand drying/screening plant for the purpose of processing a mineral suitable for use as a sand blasting medium. The machine is planned for delivery and instalment in Sacramento by the end of November 2009.
The Company has also attained funding in the form of loans totalling $379,000CDN of which $104,500 and $24,500 were with a principal shareholder and a director respectively. In conjunction with these loans, the Company issued an aggregate of 5,875,000 restricted common shares of which 4,500,000 represent shares held in trust as loan security. Further disclosure of the loans as well as the above supply and sale agreements have been reported in the Company's recent 10-K and Form 8-K filings.
On behalf of the Board of Directors Gemco Minerals Inc. "Thomas Hatton" President
Safe Harbour Statement under the United States Private Securities Litigation Act of 1995; This release made may contain forward-looking statements that are affected by known and unknown risk, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed, implied or anticipated by such forward-looking statement. The Company does not intend to update this information and disclaims any legal liability to the contrary.
Gemco Minerals Inc.
CONTACT: please contact the company at 1-866-848-2940
