Focus Minerals Ltd.

Published : January 31st, 2008

Enters into Exclusivity Agreement to Negotiate the Proposed Gain of 100% Control of 1.6moz Coo

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Focus Minerals Ltd (ASX: FML)

 

ASX / MEDIA RELEASE                                                                                          31 JANUARY 2008

 

FOCUS ENTERS INTO EXCLUSIVITY AGREEMENT TO NEGOTIATE THE PROPOSED GAIN OF 100% CONTROL OF 1.6MOZ COOLGARDIE GOLD JV

 

KEY POINTS

 

·                     Focus enters into Exclusivity Agreement to negotiate the terms of the proposed acquisition of Committee Bay Resources’ 50% interest in the Redemption Joint Venture. Consideration is $1.0 million, deductible from any subsequent purchase price.

 

·                     The proposed acquisition would deliver 100% ownership of the 1.6Moz Coolgardie Gold Project (WA), including the 1.2Mtpa Three Mile Hill gold plant – significantly increasing FML’s exposure to the gold price.

 

·                     Consideration for the proposed acquisition likely to be a mixture of cash and equity, resulting in CBR joining the Focus share register as a significant shareholder.

 

·                     Focus targeting 100,000oz pa gold production through accelerated development program.

 

·                     Initial gold production commencing in Q2 2008 at high-grade Perseverance Gold Project.

 

 

Focus Minerals Ltd (ASX: FML – “Focus”) has moved to consolidate its position as an emerging mid-tier Australian gold and nickel producer after signing an agreement to exclusively negotiate in respect of the proposed acquisition by Focus of the 50% interest in the 1.6 million ounce Coolgardie Gold Project in Western Australia (“Proposed Acquisition”) held by its joint venture partner, Canadian-based Committee Bay Resources Ltd. (TSXV: CBR – “Committee Bay”) (“Exclusivity Agreement”).

 

The consideration payable for the Proposed Acquisition is likely to be payable in 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, positioning it to join the ranks of Australian gold producers. Focus’ objective is to become a 100,000 ounce per annum producer within the next three years.

 

The Proposed Acquisition, which would be subject to shareholder approval, would give Focus 100% ownership of the Redemption Joint Venture assets at Coolgardie, including an extensive resource inventory within multiple deposits totalling 20.8 million tonnes at 2.46g/t Au for 1.649 million ounces (refer note 1), the fully permitted 1.2mtpa Three Mile Hill gold processing facility (currently on care and maintenance), and a highly prospective 210km2 tenement package offering an outstanding pipeline of exploration and development opportunities.

 

Note 1 – Please refer the Resource Listing contained within the 2007 Annual Report and subsequent Perseverance upgrade ASX release dated 10 October 2007.

 

The Company has mandated international specialist banking group Investec Bank (Australia) Ltd. to be the debt provider for the Perseverance project.

 

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.

 

Execution of the Exclusivity Agreement and negotiations in respect of the Proposed Acquisition reflect Committee Bay’s decision to focus on its extensive portfolio of international mineral assets in Nunavut, Latin America and elsewhere in Australia, and its view that Focus is better placed for logistical and geographical reasons to manage the development of the Coolgardie asset. Committee Bay remains strongly supportive of Focus’ development strategy.

 

 

Focus is gearing up to commence initial gold production at Coolgardie in April at the high-grade Perseverance Project (Indicated Resource of 92,066oz at an average grade of 6.4g/t Au) after completing a positive Feasibility Study in December 2007. This Project is forecast to yield base case production of 64,187 ounces over 21 months, with upside to more ounces and a higher gold price.

 

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. This 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% of the project. Both the Boards of FML and CBR have met and approved the commencement of mining, however, if subsequent commercial terms for the purchase of CBR’s 50% of the RJV cannot be concluded, CBR will reimburse FML for 50% of expenditures incurred on the Coolgardie Project between the 1st January 2008 and 31st March 2008 (which is the date when the Exclusivity Agreement expires), excluding any expenditures made in January, being part of an earlier RJV cash call.

 

 

Commenting on the landmark Exclusivity Agreement, Focus Minerals’ Chairman, Mr Don Taig, said: “We are very pleased to have signed this important agreement with Committee Bay, which – subject to acceptable terms and shareholder approvals - will 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,” he continued.

 

“2008 will be a pivotal year for Focus as we move into production, initially at Perseverance,” he commented. “Furthermore, the acquisition will put us in a very strong position to develop the broader Coolgardie assets in a timely and efficient fashion at a time of historic strength in the gold market.”

 

 

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

 

 

 

ENDS

 

 

Released by:

On behalf of:

Nicholas Read/Jason Cunningham

Don Taig, Chairman

Peter Williams, Managing Director

Read Corporate
Focus Minerals Ltd

Telephone: (+61-8) 9388-1474

Telephone: (+61-8) 9215-7888

www.readcorporate.com.au

Web: www.focusminerals.com.au

 

 

 

 

COMPETENT PERSON’S STATEMENT

The information in this report relating to Resources and Reserves are based on work supervised by Mr Chuck McCormick who is a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr McCormick has the relevant experience as a “Competent Person” as defined in the 2004 edition of the Australasian Code for Reporting of Mineral Resources and Ore Reserves in relation to the mineralisation reported on. Mr McCormick is Exploration Manager of Focus Minerals Ltd and consents to the inclusion of the material in the form and content in which it appears.

 

 

 

BACKGROUND INFORMATION – FOCUS MINERALS LTD

 

Focus Minerals Ltd (ASX: FML) is an Australian-based exploration and development group whose focus is to become a significant gold and nickel producer in the Coolgardie-Kalgoorlie-Widgiemooltha region of Western Australia.

 

Focus Minerals - through its Joint Venture with Committee Bay Resources - is the largest landholder in the Coolgardie Gold Belt located in Western Australia, 560km east of Perth and 35km west of the ‘Super Pit’ in Kalgoorlie-Boulder. More than 2.6 million ounces of gold has been produced from the Coolgardie gold belt alone since 1892. Focus holds the mineral rights to more than 210sq km of tenements including Measured, Indicated and Inferred Resources exceeding 1.6 million ounces of gold as well as the 1.2mtpa Three Mile Hill processing plant.

 

Focus Minerals is also fast tracking development of its wholly-owned Nepean Nickel Project (current estimated resource totalling 591,300t @ 2.2% Ni) located 25km south of Coolgardie. Focus has a view of recommencing mining operations from the historic production centre in 2008.

 

 

 

 

READ CORPORATE
Public Relations Corporate Communications
T: (+61-8) 9388-1474 | F: (+61-8) 9388-1472 | E: info@readcorporate.com.au | Web: www.readcorporate.com.au 

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Focus Minerals Ltd.

PRODUCER
CODE : FML.AX
ISIN : AU000000FML4
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Focus Min. is a gold development stage company based in Australia.

Focus Min. holds various exploration projects in Australia.

Its main assets in production are COOLGARDIE, MOUNT GOLD and TINDALS MINING CENTRE in Australia and its main exploration properties are NEPEAN MINE, MOUNT (REDEMPTION JV), LAKE COWAN and TREASURE ISLAND in Australia.

Focus Min. is listed in Australia and in Germany. Its market capitalisation is AU$ 53.0 millions as of today (US$ 37.7 millions, € 33.2 millions).

Its stock quote reached its highest recent level on March 05, 2004 at AU$ 9.75, and its lowest recent point on March 13, 2020 at AU$ 0.15.

Focus Min. has 182 750 000 shares outstanding.

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Annual reports of Focus Minerals Ltd.
FY12 Annual Report & September Quarterly Report
Nominations of Focus Minerals Ltd.
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4/20/2011Appoints two new directors to board
1/14/2009Appointment of Chief Operating Officer
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7/11/2011June Gold Production up 34%
6/8/2011Open Briefing: CEO on Production Ramp-Up and Outlook
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3/17/2011(Mount Gold)Production set for significant boost as mining starts at The...
3/4/2011(Treasure Island)Focus acquires remaining stake in Treasure Island gold proje...
3/1/2011(Tindals Mining Centre)High-grade results point to more open pit resources at Tinda...
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1/12/2011(Coolgardie)Hits target with production of 21,000oz in December quarter
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9/7/2009(Mount (redemption Jv))Commencement of Mining at The Mount
8/11/2009(Tindals Mining Centre)High Grade Intercepts at Tindals Mining Centre
8/11/2009(Tindals Mining Centre)Exploration Drilling Delivers Further High-Grade Gold Interc...
2/12/2009(Coolgardie)80% Increase in Gold Resources at Brilliant Deposit, Coolgar...
5/28/2008Commencement of Nepean Drilling Programme to Underpin Ongoin...
4/29/2008(Coolgardie)Delivers Maiden Gold Pour at Coolgardie Project, Western Aus...
4/3/2008(Perseverance) Upgraded Gold Reserves at Perseverance Gold Deposit Boosts ...
4/2/2008(Nepean Mine)Outstanding High-Grade Nickel Intercepts Enhance Nepean Proj...
3/26/2008(Coolgardie)Substantial Resource Upgrade for Countess Gold Deposit, Cool...
3/7/2008(Coolgardie)unveils $64m Strategy to Buyout Cooolgardie Gold JV
2/19/2008(Coolgardie)Further Resource Upgrade for High-Grade Perseverance Gold De...
Corporate news of Focus Minerals Ltd.
6/9/20162015 Annual Report
4/29/2016March Quarterly Activities and Cashflow Report
4/29/2016Coolgardie and Laverton Exploration Update
4/18/20162015 Annual Report
3/31/20162015 Full Year Financial Accounts
1/29/2016December 2015 Quarterly Activities and Cashflow Report
1/27/2016More Evidence of Significant System at Karridale
11/17/2015Maiden High Grade Resource For Bonnie Vale
10/29/2015September 2015 Quarterly Activities and Cashflow Report
10/16/2015Bonnie Vale Resource Modelling Commences
8/25/2015Correction to Quarterly Activities and Cashflow Report
7/29/2015June 2015 Quarterly Activities and Cashflow Report
7/24/2015Coolgardie Exploration Update: Bonnie Vale Continues to Deli...
4/13/2015Laverton Exploration Update
3/31/2015Focus Minerals Limited – Financial Report YE 2014
2/11/2015Coolgardie Exploration Update
2/11/2015Focus Minerals Ltd December 2014 Quarterly
12/4/2013Director Retirement
12/4/2013AGM Address
2/5/2013Management Change
1/31/2013December Quarterly Report
9/28/2012FY12 Full Year Results
8/7/2012Diggers & Dealers Presentation
10/13/2011Crescent Gold Board Changes
9/1/2011Launches iPad App on the Apple iTunes Store
8/3/2011Relevant Interest Over 50% in Crescent
6/29/2011and Crescent Release Their Bidder's and Target's Statements
6/20/2011Takeover of Crescent Gold by Focus Minerals
4/14/2011On track to accelerate growth plans after completing $7m SPP...
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1/31/2011December 2010 Quarterly Report
8/24/2010Profit Guidance - Record full year net profit
7/29/2010June 2010 Quarterly Activities Report
7/29/2010Quarterly Report for the Period Ending 30 June 2010
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4/30/2010March 2010 Quarterly
4/30/2010Activities Report For The Quarter Ended 31 March 2010
3/4/2010Delivers First Half A$4.9m Interim Net Profit
1/28/2010Activities Report For The Quarter Ended 31 December 2009
1/27/2010Signs Deal with La Mancha
11/26/2009Market Update
11/9/2009Record Milling Campaign Delivers Gold Production of ~ 21,900...
10/27/2009September Activities Report
10/19/2009Audio Presentation to the Australian Gold Conference
9/17/2009 (Audio) Focus Announces Maiden 2009 Year Net Profit - Mr Ca...
9/9/2009(Audio) Emerging Mid-Tier Gold Producer Steps Closer to Prod...
8/12/2009Signs Mill Treatment Exclusivity Agreement with Matsa Resour...
7/29/2009(Audio) Board Room Radio Broadcast
7/23/2009June Quarterly Activities Report
6/30/2009Delivers Record Gold Production of 19,226oz From Recent Mill...
2/24/2009Landmark A$28M Capital Raising To Fund Aggressive Growth Str...
1/23/2009 Activities Report for the Quarter Ended 31 December 2008
12/1/2008(Tindals Mining Centre)69% Increase in Probable Ore Reserves at Tindals Mining Cent...
11/26/2008Chairman's Supplementary Statement - AGM 25th November 2008
7/29/2008June Quarterly Report
5/1/2008Completes Settlement of JV Acquisition
5/1/2008Quarterly Activities Report
3/11/2008Completes $14M Placement, Announces Details of Share Purchas...
1/31/2008December 2007 Quarterly Activities Report
1/31/2008Enters into Exclusivity Agreement to Negotiate the Proposed ...
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