Gold Anomaly and Liongold (SGX:A78) Sign MOA to Develop PNG Assets
Sydney, Aug 20, 2012 AEST (ABN Newswire) - Gold Anomaly Limited (
ASX:GOA) today announced details of a proposed agreement that would fast track development of its assets in Papua New Guinea ("PNG") and deliver first production within 15 months.
The company has entered into a Memorandum of Agreement ("MOA") with Singapore Exchange-listed gold investment and development company LionGold Corporation Ltd (SGX:A78) ("LionGold") which provides, subject to conclusion of a final binding legal agreement to be negotiated between the parties, for LionGold to acquire up to 60% of GOA's PNG subsidiary company Anomaly Limited ("AL") which owns GOA's PNG assets. These assets includes Crater Mountain, which is shaping up as a major gold and copper deposit, as well as the Fergusson Island gold deposits, with total current gold resources in excess of 1 million ounces.
Under the terms of the MOA LionGold can earn up to 60% of AL, with the remainder to be held by GOA. LionGold will invest up to $8.5M by way of 3 tranches of convertible notes (firstly into GOA by way of a $2.0 million convertible note, issued within seven days of signing of the MOA, at a 20% premium to the 6 month VWAP of GOA shares immediately prior to issue of the convertible note; secondly for 40% of AL by way of a $3.0 million convertible note; and thirdly an option for a further 20% of AL by way of a $3.5 million convertible note.. Upon advance of the $2m LionGold will be entitled to nominate a director for appointment to the GOA Board. Advance of the $3.0m tranche is subject to:
1. satisfactory due diligence by LionGold on GOA, AL and GOA's PNG projects; and
2. GOA providing to LionGold's satisfaction an exploration, development and production feasibility plan for the next three years.
Funds raised will assist in advancing a PNG development and exploration program that seeks to:
- Commence mining operations within 15 months at the High Grade Zone1 within the Nevera deposit at Crater Mountain
- Expand the current 790koz gold resource at Crater Mountain and take that into production
- Identify further and define the gold/copper porphyry potential at Crater Mountain
- Further review the near term production potential on Fergusson Island
Commenting on the transaction, Gold Anomaly Executive Chairman Mr Greg Starr said that he was delighted that the company could now advance several of its outstanding PNG projects, and in particular, Crater Mountain.
"We have only begun to scratch the surface at Crater Mountain, having identified some 790koz gold in less than 12 months of our maiden drilling program. This transaction will enable us to further define then commence production in the High Grade Zone, further define resources at Nevera, continue the hunt for the prized gold copper porphyry feeder system at depth, extend regional exploration, and transition the company to producer-status far more quicker than we had initially envisaged.
LionGold has both a strong balance sheet, and a focus of developing Australian gold companies into near term production.
We look forward to working together with LionGold to crystallise maximum value from our PNG projects.
Importantly, given the challenging state of capital markets, the proposed joint venture is structured in a way that minimises our need for further capital raisings prior to production, whilst still advancing our PNG assets."
Following the transaction, Gold Anomaly will continue the technical management of the PNG assets, leveraging the company's experience, expertise and networks within PNG.
For the full release, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-GOA-244468.pdf
Contact
Gold Anomaly Limited
T: +61-2-9241-4224
F: +61-2-9252-2335
WWW: www.goldanomaly.com.au
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