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| April 4, 2011 |
| Rio Novo Gold Increases Land Position by 80% at Its Almas Gold Project |
TORONTO, ONTARIO--(Marketwire - April 4, 2011) - Rio Novo Gold Inc. (TSX:RN)(TSX:RN.WT) ("Rio Novo" or the "Company") is pleased to announce that it has entered into an Exploration and Option Agreement ("the Agreement") by which the Company has the right to acquire 100% interest in five mineral rights (four exploration authorizations and one application for exploration authorization), covering an area adjacent to its Almas Gold Project. In total, these areas add 30,766 hectares to the Almas Gold Project's current land package, thereby increasing Rio Novo's overall land position to 69,264 hectares, comprised of 15 mineral rights located within the Almas gold district.
To view the new status of Rio Novo's land package over regional geological map, please visit the following link: http://media3.marketwire.com/docs/MAP_GEO_CPRM_1M_ALMAS.jpg
Under the terms of the Agreement, Rio Novo has agreed to pay US$200,000 on execution of the Agreement and US$200,000 per annum up to five years until commencement of eventual production, which will be subject to a 2.5% Net Smelter Return ("NSR") with Rio Novo retaining a right of first refusal in eventual sale of the NSR. Should production not commence in 5 years, the annual payments should increase to US$400,000. In addition, a one time payment of $200,000 is due 12 months from the publication by the National Department of Mineral Production (DNPM) of the assignment of the minerals rights to Rio Novo (the "Exploration Initial Date").
Rio Novo also committed to spend $3,000,000 in exploration work over a 36 months period (from the Exploration Initial Date), and to complete a 3,000 m drilling program in the first year of the exploration activities. Rio Novo has the right to withdraw from the project and terminate the Agreement anytime according to the terms and conditions of the Agreement, being obliged in such case to return the mineral rights to its original owner.
The mineral rights cover an area of strong geochemical anomaly with extensive historical artisanal mining activity and have been object of previous prospecting, sampling, trenching, soil geochemical survey and geological mapping. Rio Novo believes that it can fast pace the definition of drilling targets based on its own interpretation of the substantial geological data base to be acquired with this Agreement and its growing knowledge of the Almas gold district.
CEO David Beatty comments: "We are pleased to have signed this option agreement, which includes a land package that our exploration team believes it has significant potential. This strategic land package increases our claim holdings by 80% at the Almas Gold Project, and it cements Rio Novo as the dominant player in the Almas Greenstone Belt. It is part of our continuous and systematic focus to increase our current resources as we move forward with the development of the Almas mine and processing plant, with the view to start production in Q2 2012."
About Rio Novo
Rio Novo is currently focused on the acquisition, exploration and development of gold mineral resource properties in Brazil. The Company's goal is to become a producer of gold in the short term by bringing into production its two Brazilian properties, the Almas Gold Project, located in the State of Tocantins State, and the Guaranta Gold Project, located in the State of Mato Grosso. Both projects enjoy established infrastructure in mining friendly jurisdictions. In addition to exploring and developing the Almas and the Guaranta Gold Projects, the Company intends to identify, explore and develop or acquire additional precious metals properties in Brazil and other established mineral jurisdictions in South America.
This press release contains forward-looking statements. All statements, other than of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding the estimation of mineral resources, exploration results, potential mineralization, potential mineral resources and mineral reserves) are forward-looking statements. Forward-looking statements are often identifiable by the use of words such as "anticipate", "believe", "plan", may", "could", "would", "might" or "will", "estimates", "expect", "intend", "budget", "scheduled", "forecasts" and similar expressions or variations (including negative variations) of such words and phrases. Forward-looking statements are subject to a number of risks and uncertainties, many of differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, failure to establish estimated mineral resources, the possibility that future exploration results will not be consistent with the Company's expectations, the price of gold and other risks identified in the Company's most recent annual information form filed with the Canadian securities regulatory authorities on SEDAR.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement. | |
| CONTACT INFORMATION:
Rio Novo Gold Inc.
David Beatty
Chief Executive Officer
+1 (416) 368-8288
david.beatty@Rnovogold.com
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Rio Novo Gold Inc.
Alex Penha
General Manager, Corporate Development
+1 (416) 368-1573
alex.penha@Rnovogold.com
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| INDUSTRY: Manufacturing and Production - Mining and Metals | |
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