Wednesday, December 22, 2010

BELIZE - Erin Ventures sells placer gold mining rights in Belize to invest in Boron exploration in Serbia

ERIN VENTURES SELLS OUT PLACER GOLD MINING LICENSE OPERATION IN BELIZE AND INVESTS PROFITS IN SERBIA

Erin Signs Serbian Boron Joint Venture Agreement

Erin Ventures Inc. [TSX-Venture: EV] is pleased to report that it has entered in to a binding agreement with the Serbian state-owned mining company, JP PEU, for the joint development of the Piskanja boron deposit, located in Serbia.

This agreement is subject to the Serbian Mining Ministry granting an exclusive exploration license for the Piskanja deposit to Erin. This agreement has been officially endorsed by JP PEU, Ibarski Mines (a wholly owned subsidiary of JP PEU, which currently holds the rights to the Piskanja boron deposit), and the National Serbian Miners Union. It is estimated that the percentage ownership in the joint venture will be approximately 90% Erin; 10% JP PEU, based upon the relative values of the contributions made by the parties.

Erin is currently preparing the documentation required for the exploration license, for submission to the Serbian authorities. It is anticipated that an exploration license may be granted within the next 90 days.

The key terms in the agreement are as follows:

* Erin's wholly-owned Serbian subsidiary, Balkan Gold d.o.o. ("Balkan") will apply for an exclusive exploration license on the Piskanja property, and conduct a geological study on the deposit. If results are positive, Balkan will then compose a feasibility study for mine development. Balkan is responsible for 100% of the costs related to these studies, and retains 100% ownership at this stage.

* When the feasibility study is complete, Balkan and JP PEU will form a joint venture company that will apply for an exploitation license. However, in the event that JP PEU's corporate structure does not allow for it to enter into this joint venture (as is currently the case), Balkan will retain the right to apply for the exploitation license on its own, and retain 100% interest in the project.

* Ownership in the joint venture company will be directly proportional to the value of the assets contributed by each party.
* Balkan will be responsible for providing all the funding required to develop the mine and ore processing facilities.
* JP PEU will contribute certain existing infrastructure assets in its possession (such as a power substation, access roads, rail spur, office and maintenance buildings in strategic proximity to the property) and historical research data from previous exploration programs at Piskanja. The determination of the assets to be contributed by JP PEU to the joint venture shall be at the sole discretion of Balkan. These assets will be contributed at their established fair market value.

* An official determination of percentage ownership will occur at the completion of the mine development, and be based upon the amount that has been actually spent by Balkan on exploration and mine development, and the fair market value of the assets contributed by JP PEU.

* Balkan and JP PEU agree that the joint venture company will primarily employ manpower from the Ibarski Mine, as qualified and required.

* Each party will have representation on the board of directors of the joint venture company on a basis that reflects their prorata ownership of the joint venture company.

This joint venture agreement between Erin and JP PEU has no direct bearing on Erin's ongoing US$15 million legal action against EPS, the national power corporation of Serbia, regarding alleged breaches by EPS in the former joint venture agreement it held with Erin regarding the development of the Piskanja property (as reported by Erin in its news release dated June 22, 2009).

Summary of the Piskanja boron property
Piskanja is located in a historical mining region that has good infrastructure for mining including roads, rail, electric power, experienced miners, etc., 250 km south of Belgrade by good paved roads.

The Piskanja property has a historic resource (that is not NI 43-101 compliant and must be verified) of approximately seven million tonnes of 39 per cent B2O3 (boron) as colemanite and ulexite, based upon historic drill data (some of which, was conducted by Erin previously). The deposit is open both to the south and the east. Evaluation of the drill-hole data by Erin's technical advisers indicate that the Piskanja deposit has the potential of hosting additional significant borate reserves.

About boron
Borate minerals and refined borate products are used extensively worldwide in the manufacture of vitreous products such as fiberglass insulation, textile fiberglass, borosilicate glass (LCD screens), ceramic glazes and porcelain enamels. These applications account for approximately 60 per cent of borate consumption, with detergents, fire retardants, metallurgy, agriculture, insecticides, wood preservatives and specialty products accounting for the remainder. Consumption of borates used in high- technical applications is expected to increase by 10% in North America and 13% in Europe by 2012. China is the largest consumer of boron, where consumption has rose by 15 percent per year from 2000 to 2010. Market prices reflect the relative scarcity of borates with prices averaging: US$280/t for colemanite concentrate (40-42 percent B2O3); US$500/t for ulexite (40 percent B2O3); US$550/t for boric acid; and US$50/kg for anhydrous borax.*
*Source: US Geological Survey, Report on Boron 2008.

About JP PEU and Ibarski Mine
In operation since 1853, JP PEU ("Public Company for Underground Coal Exploitation, Resavica") currently operates 9 mines throughout Serbia. It produces 500,000 tonnes of coal per year, and employs 4,000 workers. Ibar Mine, a wholly owned subsidiary of JP PEU, has been producing coal for 100 years, with 500 employees experienced in underground mining. The Piskanja deposit is located in the mining region belonging to the Ibar mine.

On behalf of the Board of Directors,
Blake Fallis, General Manager

For further information, please contact:
Erin Ventures Inc.
Blake Fallis, General Manager
Phone: 1-250- 384-1999 or 1-888-289-3746
www.erinventures.com

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