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Re: News Release - Wednesday, June 18, 2008
BacTech Signs First Refractory Gold Project
To Acquire Yamana's 33% stake in PNG properties
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Toronto, Canada, June 18, 2008 - BacTech Mining Corporation ("BacTech"
or the "Company") today announced that it has reached an agreement with
Yamana Gold Inc. ("Yamana", TSX: YRI; NYSE: AUY; LSE: YAU) to acquire
its 33% stake in two refractory gold projects in Papua New Guinea
("PNG"). The balance of the ownership in the projects (67%), is held by
the current operator, Gold Aura Limited ("GOA", ASX: GOA), of Brisbane,
Australia.
Under the terms of the agreement, BacTech will issue 15 million common
shares to Yamana as compensation for the purchase. Yamana will own a
19.97% equity interest (non-diluted) in BacTech post closing of the
transaction. BacTech will also provide bioleach consulting on one
Yamana project going forward. On closing, the existing agreement
between GOA and Yamana will be cancelled to accommodate BacTech's
participation going forward.
A new joint venture, between BacTech and GOA, has been created to
replace the previous arrangement between GOA and Yamana. Under the
terms of the new agreement, BacTech will pay CAD$1M directly to GOA to
increase its stake in the deposits to 43%. The initial payment of
CAD$500,000 will be made on the later of 60 days after signing the
agreement and 30 days after the receipt of all requisite regulatory
approvals including the approval of the transfer of the licenses by the
Papua New Guinea government. The balance of the funds will be due in 12
months from the transfer. The final payment will be either 5,000,000
shares of BacTech or cash. In addition, BacTech will spend CAD$1.5M
over the next 24 months directly on the project to raise its stake to
50%.
As part of the agreement, BacTech will retain GOA's current exploration
management team to continue to explore and develop the project. GOA
will charge BacTech a 12% management fee on the exploration funds to
continue to operate the program. In addition, the agreement lays out
certain property purchase options for BacTech should they decide to
increase their stake over 50%.
The underlying assets in PNG are the Gameta and the Wapolu deposits,
both located on the north shore of Fergusson Island and approximately
30 km apart. Since 1996, over $15M has been spent by GOA and Yamana on
the properties. Historically, both projects have been serviced by water
access due to their close proximity to the coast.
The completion of the purchase agreement with Yamana and the joint
venture agreement with GOA are subject to certain conditions which
include requisite regulatory consents from mining authorities in Papua
New Guinea, and the receipt by BacTech of the approval of the TSX
Venture Exchange to the transaction and the issuance of the common
shares to Yamana and to GOA.
The Properties
Gameta: At this time, GOA is conducting an infill drill program to
define a JORC resource. One of the highlights of the current program
has been the discovery of much thicker mineralization at depth. To
date, the JV has drilled 192 RC holes, 273 air-core holes and 32
Diamond drill holes.
Wapolu: Located approximately 30 kms from Gameta. As the feasibility
study begins at Gameta, Wapolu will be drilled more aggressively to
outline a JORC compliant resource. To date, the joint venture has
drilled 227 RC holes, 272 air-core drill holes and 97
Diamond drill
holes.
The transaction provides BacTech with its first project under its
refractory gold acquisition program. Ross Orr, President and CEO said,
"We have been able to acquire equity in a couple of assets after a long
search. One of the major benefits of this deal is the retention of the
GOA personnel to carry out future exploration and development. I am
confident that there will be several more acquisitions in the coming
months which will allow us to build an inventory of refractory gold
where we can employ our commercially proven bioleaching technology. Our
goal this year is to ultimately build an inventory of in excess of 1
million ounces of gold through earn-in or by acquisition."
Technical and scientific data in this news release has been verified by
Dr. Paul Miller, the Company's Vice President of Technology and
Engineering. Dr. Miller is a chartered engineer and a member of the
Institute for Mining and Metallurgy, London, England, and is a
qualified person for the purposes of National Instrument 43-101. Dr.
Miller has reviewed and approved the contents of this news release.
About PNG
Papua New Guinea is a collection of islands that sit northeast of
Queensland, Australia, and is the host to many well known gold mines
such as Porgera (20M oz), Lihir (45M oz), Ok Tedi (17M oz) and
Bougainville (16M oz). Due to the number of world class large deposits
in PNG, the government of PNG is now strongly championing the
development of smaller mines.
BACTECH PROFILE
BacTech has developed and patented bacterial oxidation technology for
the treatment of refractory ores and concentrates to enhance the
recovery of gold, silver and base metals. BacTech has successfully
commissioned three bioleach plants for gold and demonstrated its
technology in the selective recovery of base metals from complex
sulphide concentrates in a joint project with Industrias Pe�oles de
C.V. of Mexico that was completed in 2001. The Company's focus is the
acquisition of equity positions in projects amenable to bioleaching.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
Except for statements of historical fact relating to the Company,
certain information contained herein constitutes "forward-looking
statements". Forward-looking statements are frequently characterized
by words such as "plan," "expect," "project," "intend," "believe,"
"anticipate" and other similar words, or statements that certain events
or conditions "may" or "will" occur.
Forward-looking statements are based on the opinions and estimates of
management at the date the statements are made, and are subject to a
variety of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected in
the forward-looking statements. These factors include the inherent
risks involved in the exploration and development of mineral
properties, the uncertainties involved in interpreting drilling results
and other ecological data, fluctuating metal prices, the possibility of
project cost overruns or unanticipated costs and expenses,
uncertainties relating to the availability and costs of financing
needed in the future and other factors described in the section
entitled "Risks" in the Company's Management Discussion and Analysis
for the Year Ended December 31, 2007. Circumstances or management's
estimates or opinions could change. The reader is cautioned not to
place undue reliance on forward-looking statements.
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For further information contact:
Ross Orr, President & CEO, 416-813-0303 ext 222
Investor Relations:
Pierre Anglos 1-800-436-2027
Email: capitalgainsco@shaw.ca
Shares outstanding 60,107,206
The TSX Venture Exchange has not reviewed and does not accept any
responsibility for the adequacy or accuracy of this release
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Copyright (c) 2008 BACTECH MINING CORPORATION (BM) All rights
reserved. For more information visit our website at
http://www.bactech.com/ or send mailto:info@bactech.com
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