Oroco Signs Indicative Term Sheet For Cerro Prieto Construction Financing

June 17, 2011

VANCOUVER, British Columbia – (June 17, 2011) Oroco Resource Corp. (TSX-V: OCO) (“Oroco” or “the Company”) is pleased to announce that it has entered into an Indicative Term Sheet with a New York-based, private institutional investor in regard to a US$18 million gold prepayment agreement.  Under the terms of the Indicative Term Sheet:

1.   Net proceeds from the prepayment agreement, after deduction of a 3% fee, are to be used to develop the Cerro Prieto Oxide Gold Project in Sonora State, Mexico;

2.   The US$18 million prepayment is to be satisfied by the delivery by Oroco of 21,000 ounces of gold to the lender over a period of 36 months following closing.  Additionally, Oroco is to grant to the lender a series of warrants entitling the lender to purchase up to 8,400 ounces of gold from Oroco at a price of US$1,550 per troy ounce over the 24 month period beginning two years after closing; and

3.   Funding under the agreement will be subject to completion of legal documentation, receipt of regulatory approvals, including that of the TSX Venture Exchange, and conditions precedent typical of a transaction of this nature.  The net prepayment proceeds will be fully drawn down to an escrow account at closing, anticipated to occur in August, 2011.

Craig Dalziel, Oroco’s President, commented that “We are confident that utilizing our future gold production to fund the majority of our capital requirements at Cerro Prieto will be significantly less dilutive to Oroco and its shareholders than funding the mine construction and initial operations through share equity.  We anticipate that the strong economic model at Cerro Prieto will assist Oroco in securing, on similarly favourable terms, the $4,000,000 in additional working capital required to fund the project through to production.”

About Oroco

Oroco is a Canadian-based mineral exploration company with its primary focus on the accelerated development of the gold-bearing oxide zones of its Cerro Prieto Oxide Gold Project in Sonora State, Mexico. In late 2010, Oroco received a positive Preliminary Economic Assessment for the Project. The Cerro Prieto Project consists of the San Felix, San Francisco, Elba and Cerro Prieto concessions, totaling 2,729 ha, and the contiguous 4,224 ha Argonauta 6 concession.

For further information, please contact: 
Mr. Craig Dalziel, President and CEO
Oroco Resource Corp. 

Tel: 604-688-6200 

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the

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These historical resource estimate models are based upon historical resource estimates prepared by John Thornton in 2011. While, in the opinion of Dane A. Bridge, author of the revised NI 43-101 standard technical report, Geology, Mineralization and Exploration of the Santo Tomas Cu-(Mo-Au-Ag) Porphyry Deposit, Sinaloa, Mexico dated April 21, 2020 (the “Report”), reliable estimation practices were used, in order to upgrade or verify the historical estimations, resampling and assay of historical drill samples, twinning of historical drill holes, and a new program of regularly spaced drilling is required. No qualified person has undertaken sufficient work to classify the current mineral resources or mineral reserves upon which these models are based and the Company is not treating the estimates as current estimates of the mineral resources. The Company gives no assurance that either these models or the historical resource estimates upon which they are based are accurate, and does not undertake any obligation to update the models or to release publicly any update or revisions of the resource estimates except as required by applicable securities law. The reader is cautioned not to rely upon these models or the historical resource estimates upon which they are based.

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