NR - CORRECTION FROM SOURCE: Glass Earth Gold to P CORRECTION FROM SOURCE: Glass Earth Gold to Purchase Joint Venture Partner to Consolidate Placer Gold Production
WELLINGTON, NEW ZEALAND--(Marketwire - March 15, 2012) - This document corrects and replaces the document released at 8:00 AM EST on March 15th, 2012. In the table titled "Consideration," a row labelled "Deferred cash (payable June 11, 2012)" has been added. The complete and corrected news release follows.
Glass Earth Gold Limited (TSX VENTURE:GEL)(NZAX:GEL) ("Glass Earth Gold" or "the Company") announces the purchase of its placer gold production joint venture partner, Goldmines New Zealand Limited, as well as the remaining 50% share of the joint venture's mining operator, Dunstan Mining Limited, in regards to the placer mining/exploration project located in Otago, New Zealand.
On 15 March 2012, the Company entered into agreements to acquire full ownership of its placer joint venture and associated mining equipment. The transaction involves purchasing the 50% of shares in Dunstan Mining Limited (mining operator) that the Company did not already own, and 100% of the shares in Goldmines New Zealand Limited (the other 50% joint venture party).
Taking full control of placer mining activities will enable the Company to significantly accelerate and increase production capacity.
In 2011, the placer joint venture (then 50% Glass Earth Gold), contributed CAD$752,000 in gross revenue and CAD$274,000 in net revenue based on only one Gold Recovery Unit ("GRU") operating. The Company plans to commission a further GRU in Q2 and another in Q3.
This together with 100% ownership and increase in throughput should enable the Company to achieve its previously articulated production goals.
Consideration
| | | | NZ$m | | CAD$m | |
| | Issue of 2,188,184 shares of the Company | | | | | |
| | Cash | | 0.5 | | 0.4 | |
| | Deferred cash (payable June 11, 2012) | | 1.5 | | 1.2 | |
| | Deferred cash (payable NZ$80k/month (CAD$65/month) for 25 months commencing July 1, 2012) | | 2.0 | | 1.6 | |
| | Total cash: | | $4.0 | | $3.2 | |
| | | | | | | |
The transaction is subject to TSX Venture Exchange approval.
About Glass Earth Gold
Glass Earth Gold is one of New Zealand's largest gold exploration companies, with its experienced geological team exploring promising gold prospects across a land position of approximately 10,000 square kilometres, in both the North and South Islands. The Company held a net cash position of CAD$3.6 M at the end of Q4 2011 to fund exploration progress.
In the North Island, exploration efforts are focused on large epithermal gold systems in the Hauraki Region, host to the 10 million ounce Martha Hill mine, (Newmont Mining).
In the Hauraki Region Glass Earth Gold has identified and developed significant ground positions around Newmont Mining's currently active Martha gold operations at Waihi. The Newmont-Glass Earth Gold Waihi West JV (Newmont earning in) and Hauraki JV (65/35), including drilling at the WKP discovery, is being actively explored and managed by Newmont in concert with Glass Earth Gold.
Glass Earth Gold has also defined several significant epithermal gold targets to independently explore in this region including the Muirs Reef project. Containing a historical resource of 390,000 oz (non NI 43-101-compliant, at 1.5 g/t Au and cut-off grade of 0.5 g/t Au), further drilling is being undertaken to prove up the resource.
In the South Island, exploration efforts are focused on the Otago Region, home to OceanaGold's 7 million ounce Macraes Goldfield, for identification of mesothermal "Macraes-style" gold targets and revenue generation through placer (alluvial) gold production.
For more information on Glass Earth Gold, please visit www.glassearthgold.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) nor New Zealand Exchange Limited has reviewed this release and neither accepts responsibility for the adequacy or accuracy of this release.