31/01/2008 - 11:27

Focus Minerals to buy out Coolgardie Gold Project

31/01/2008 - 11:27

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Emerging mid-tier Australian gold and nickel producer, Focus Minerals Ltd, plans to acquire the remaining 50 per cent stake in its Coolgardie Gold Project held by Canadian-based joint venture partner, Committee Bay Resources Ltd.

Emerging mid-tier Australian gold and nickel producer, Focus Minerals Ltd, plans to acquire the remaining 50 per cent stake in its Coolgardie Gold Project held by Canadian-based joint venture partner, Committee Bay Resources Ltd.  

The deal is likely to involve payment of both cash and shares and is expected to signal a key turning point for Focus as it gears up for first gold production scheduled for April this year from the high-grade Perseverance Project at Coolgardie.

Focus' objective is to become a 100,000 ounce per annum producer within the next three years.

Subject to shareholder approval, the acqusition would give Focus full ownership of the Redemption Joint Venture assets at Coolgardie.

If the terms of the Proposed Acquisition are finalised, Committee Bay will retain exposure to the future upside arising from the company's transition to gold production and the broader development of the Coolgardie Project through its expressed interest in becoming a significant shareholder in the company.  

A key element of the exclusivity agreement is to effectively suspend the Redemption Joint Venture between 1st January 2008 and 31st March 2008.

During this period, Focus accepts full responsibility for the Coolgardie Project, which will enable planning for the commencement of mining at Perseverance to continue, unaffected by the negotiations that will occur with CBR to purchase their 50 per cent of the project.

Focus Minerals chairman Don Taig, said the proposal would deliver a sensible rationalisation of the ownership structure of the Coolgardie Gold Project and an exciting opportunity for Focus to consolidate its position as a leading Australian gold company.

"It is envisaged that Committee Bay will retain significant exposure to and involvement with the development of these outstanding assets through a large shareholding in the company, with the transaction enabling us to get on with the business of bringing the Coolgardie region back to life as a significant gold and nickel producer as rapidly as possible," Mr Taig added.  

"A successful outcome to this strategy will give us the capacity to fast-track our transition to gold and nickel production, while also developing our near term tenement packages to deliver on our goal of becoming a 100,000 oz producer with in-house gold processing capability as soon as possible."

Focus Minerals will provide further details to the market regarding the acquisition terms and funding arrangements as they are finalised.

 

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