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From: Berhane Habtemariam (Berhane.Habtemariam@gmx.de)
Date: Fri Jul 29 2011 - 11:06:26 EDT
press release - Chalice and ENAMCO Execute Shareholders' Agreement
http://i2.marketwatch.com/MW5/content/story/images/PR-Logo-Marketwire.gif
July 29, 2011, 7:01 a.m. EDT
PERTH, WESTERN AUSTRALIA, Jul 29, 2011 (MARKETWIRE via COMTEX) -- The Board
of Chalice Gold Mines Limited
<http://www.marketwatch.com/investing/stock/CXN?countrycode=CA&link=MW_story
_quote> CA:CXN +6.45% (asx:CHN) is pleased to announce that, further to the
announcement of June 16, 2011 in which it advised that it had reached
agreement with the Eritrean National Mining Corporation ("ENAMCO") for
ENAMCO's acquisition of a 30% participating interest in Chalice's Zara Gold
Project in Eritrea, East Africa, Chalice and ENAMCO have now executed a
Shareholders' Agreement to incorporate and regulate their relationship and
obligations within Zara Mining Share Company ("Zara Mining SC") which will
be the entity which is to own and operate the Koka Gold Mine and explore the
surrounding Zara Licenses.
Zara Mining SC will be owned 60% by Chalice and 40% by ENAMCO. Zara Mining
SC will have a board of directors of five, comprising three from Chalice and
two from ENAMCO. The Chalice Directors will be its Chairman Tim Goyder,
Managing Director Doug Jones and Chief Operating Officer Juan Jeffery.
Chalice and ENAMCO will contribute to the further development costs of Koka
and to future exploration expenditures on the Zara Licences on a 2/3rd
Chalice and 1/3rd ENAMCO basis, which is in line with their respective
shares of the overall participating interest. As previously advised, signing
of the Shareholders' Agreement will allow the payment of US$32 million to
Chalice on or before 27 January 2012. In addition to this amount, ENAMCO
will pay Chalice approximately US$2 million (subject to audit), which
represents a reimbursement to Chalice of ENAMCO's pro-rata share of
exploration costs expended to date on the Zara Licenses which fall outside
of the Koka Mining License.
Zara Mining SC will be the applicant of the Koka Mining License and the
related Mining Agreement which is currently being negotiated with the
Eritrean Government.
Chalice is pleased to announce this important step towards the conclusion of
the Koka Gold Mine permitting process and acknowledges ENAMCO's contribution
and cooperation in this regard.
About Chalice
Chalice Gold Mines Limited is focused on gold mine development and
exploration in Eritrea. It is developing, together with its 40% partner
ENAMCO (the Eritrean National Mining Corporation), the high grade, open pit
Koka Gold Deposit. The Koka Gold Deposit hosts a JORC and NI 43-101
compliant Probable Mineral Reserve of 4.6 million tonnes with a grade of 5.1
g/t gold, containing 760,000 ounces.
The low cash operating cost of US $338/oz gold is expected to be in the
lowest quartile of global gold mine production costs. Planned mine
production will average 104,000 gold ounces per year over a 7 year mine
life.
The Koka Gold Deposit lies within the 547 km2 Zara block of Exploration
Licenses where Chalice currently has an active drilling program underway to
test IP resistivity targets along strike from the Koka deposit.
Chalice also holds 100% of a further 825 km2 of exploration ground
consisting of the Hurum license along strike from the Zara Licenses, and the
Mogoraib North license proximal to Nevsun's Bisha Mine. This extensive
exploration package hosts numerous, high potential, early and advanced stage
gold and base metal exploration targets. Chalice is undertaking a systematic
exploration effort on these licences with the aim of discovering significant
new deposits.
TIM GOYDER, Executive Chairman
Competent Persons and Qualified Person Statement
The information in this report that relates to Exploration Results is based
on information compiled by Dr Doug Jones, a full-time employee and Director
of Chalice Gold Mines Limited, who is a Member of the Australasian Institute
of Mining and Metallurgy and is a Chartered Professional Geologist. Dr Jones
has sufficient experience in the field of activity being reported to qualify
as a Competent Person as defined in the 2004 edition of the Australasian
Code for Reporting of Exploration Results, Minerals Resources and Ore
Reserves, and is a Qualified Person under National Instrument 43-101 -
'Standards of Disclosure for Mineral Projects'. The Qualified Person has
verified the data disclosed in this release, including sampling, analytical
and test data underlying the information contained in this release. Dr Jones
consents to the release of information in the form and context in which it
appears here.
The Mineral Resource estimate was prepared by Mr. John Tyrrell who is a
Member of the Australasian Institute of Mining and Metallurgy. Mr. Tyrrell
is a full time employee of AMC and has sufficient experience in gold
resource estimation to act as Competent Person as defined in the 2004
Edition of the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (the JORC Code)' and was a Qualified
Person under National Instrument 43-101 - 'Standards of Disclosure for
Mineral Projects' at the date the National Instrument 43-101 was filed with
the Toronto Stock Exchange. Mr Tyrrell consents to the inclusion of this
information in the form and context in which it appears.
The information in this statement of Mineral Reserves is based on
information compiled by Mr David Lee who is a Member of the Australasian
Institute of Mining and Metallurgy and a full time employee of AMC. Mr Lee
has sufficient relevant experience to be a Competent Person as defined in
the JORC Code and was a Qualified Person under National Instrument 43-101 -
'Standards of Disclosure for Mineral Projects' at the date the National
Instrument 43-101 was filed with the Toronto Stock Exchange. Mr Lee consents
to the inclusion of this information in the form and context in which it
appears.
Forward Looking Statements
This document may contain forward-looking information within the meaning of
Canadian securities legislation and forward-looking statements within the
meaning of the United States Private Securities Litigation Reform Act of
1995 (collectively, forward-looking statements). These forward-looking
statements are made as of the date of this document and Chalice Gold Mines
Limited (the Company) does not intend, and does not assume any obligation,
to update these forward-looking statements.
Forward-looking statements relate to future events or future performance and
reflect Company management's expectations or beliefs regarding future events
and include, but are not limited to, statements with respect to the
estimation of mineral reserves and mineral resources, the realization of
mineral reserve estimates, the likelihood of exploration success, the timing
and amount of estimated future production, costs of production, capital
expenditures, success of mining operations, environmental risks,
unanticipated reclamation expenses, title disputes or claims and limitations
on insurance coverage. In certain cases, forward-looking statements can be
identified by the use of words such as plans, expects or does not expect, is
expected, budget, scheduled, estimates, forecasts, intends, anticipates or
does not anticipate, or believes, or variations of such words and phrases or
statements that certain actions, events or results may, could, would, might
or will be taken, occur or be achieved or the negative of these terms or
comparable terminology. By their very nature forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such factors
include, among others, risks related to actual results of current
exploration activities; changes in project parameters as plans continue to
be refined; future prices of mineral resources; possible variations in ore
reserves, grade or recovery rates; accidents, labour disputes and other
risks of the mining industry; delays in obtaining governmental approvals or
financing or in the completion of development or construction activities; as
well as those factors detailed from time to time in the Company's interim
and annual financial statements and management's discussion and analysis of
those statements, all of which are filed and available for review on SEDAR
at sedar.com. Although the Company has attempted to identify important
factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be
other factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such
statements.
Accordingly, readers should not place undue reliance on forward-looking
statements.
Cautionary Note
For readers to fully understand the information in this news release, they
should read the Technical Report for the Koka Gold Deposit dated July 27,
2010 (available at www.chalicegold.com ) in its entirety, including all
qualifications, assumptions and exclusions that relate to the information
set out in this news release which qualifies the Technical Information.
Readers are advised that mineral resources that are not mineral reserves do
not have demonstrated economic viability. The Technical Reports are each
intended to be read as a whole, and sections should not be read or relied
upon out of context. The technical information in those reports is subject
to the assumptions and qualifications contained in the Technical Reports.
Shares outstanding: 250 million
Fully diluted: 257 million
Contacts:
Chalice Gold Mines Limited
Tim Goyder
Executive Chairman
+61 9322 3960
Chalice Gold Mines Limited
Dr Doug Jones
Managing Director
+61 9322 3960
For North American Investors, please contact:
Dan Hrushewsky
Senior Vice-President Corporate Development
+1 647 864 2735
dhrushewsky@chalicegold.com
Joanne Jobin
North American Investor Relations Manager
+1 647 964 0292
jjobin@chalicegold.com
For media inquiries, please contact:
Nicholas Read
Read Corporate
+618 9388 1474
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