Westgold Resources Limited (ASX: WGR)

Westgold Resources Limited (ASX: WGR – “Westgold”) announces a fully underwritten 1-for-4 pro-rata non-renounceable rights issue at a price of 18 cents per share (“Rights Issue”) to raise approximately $5.1 million. The funds raised will be used to drive the Company’s aggressive 2008 exploration programme at the Rover Project in the Northern Territory, including the current diamond drilling at the high priority Rover 1 (Au-Cu-Co) Prospect.

The Rights Issue will be offered to all eligible shareholders on the basis of one (1) new share for every four (4) shares held at the price of 18 cents per share. This represents a 12% discount to the closing price of Westgold shares on 31 March 2008 and a 24% discount to the 30 day volume weighted average price (VWAP).

The Rights Issue will be underwritten by Westgold’s largest shareholder, Metals X Limited.

Westgold’s Managing Director, Mr Andy Beckwith, said: “The Rights Issue provides all shareholders with the opportunity to further participate in the growth of the Company’s high quality and exciting exploration assets within the Rover Field”.

“The fact that Metals X has agreed to underwrite the Rights Issue represents a strong vote of confidence in the Company’s assets, growth prospects and exploration team, and also assures us of raising the funds to support our current activities and timeframes during a period of considerable market uncertainty,” he added.

“We have recently commenced the much anticipated diamond drilling programme at the Rover 1 (Au-Cu) Prospect, and we intend to remain focussed on this drilling with the aim of establishing a high-grade gold-copper-cobalt resource later this year,” he said.

“In addition to Rover 1, we are commencing a Scoping Study on the Explorer 108 deposit, where we recently announced a significant maiden lead-zinc-silver resource, and we are building a strong  pipeline of other high-priority gold, copper and base metal targets within this high prospective and under explored province,” Mr Beckwith added.

The Company will shortly provide details of the Rights Issue timetable, including details of the Record Date and the date of dispatch of the Offer Document.

For further information contact:

Andrew Beckwith                                     Nicholas Read

Managing Director                                   Read Corporate

Westgold Resources Limited                    (08) 9388-1474
 

Tel (08) 9326 5700

BackgroundInformation

Westgold Resources is an ASX-listed exploration company (ASX: WGR) which has undergone a major transition in the past 12 months following its acquisition of Navarre Resources Pty Ltd, through which it acquired the Rover Project in the Northern Territory as well as a large portfolio of gold and uranium tenements in Western Australia.

Following the acquisition of Navarre, Westgold undertook a major drilling programme to assess the most prospective targets at its new tenements, which led to its decision to substantially focus the Company’s exploration efforts on the Rover Project and to spin-off the Western Australian assets into a separate company.  The successful IPO of this spin-off company, Aragon Resources Limited, raised $8.75m in mid-August 2007, with Westgold retaining a 42% share holding.

The Company’s core focus is to rapidly build up a significant resource base at Rover through a combination of advanced drilling and regional exploration, with the exciting opportunity at Rover 1 to delineate a high-grade gold-copper deposit similar to the world-famous Warrego deposit at Tennant Creek.

At Rover 1, historical but limited drilling during the late 1970’s and early 1980’s intersected strong gold-copper-cobalt mineralisation including 22m @ 13.4g/t Au plus 1.3% Cu, 9m @ 10.1g/t Au plus 1.3% Cu, 3m @ 14.1g/t Au plus 4.1% Cu and 5m @ 9.6g/t Au plus 1.4% Cu within a magnetite-chlorite rich ironstone that has very strong similarities to the high-grade gold and copper systems mined at Tennant Creek.

Examples of past production from the more significant Tennant Creek mines include:

§               Warrego Mine                 1.6Moz @ 7g/t Gold and 174,000 tonnes Copper

(including 1.0Moz @ 16g/t gold)

§               Nobles Nob                     1.1Moz @ 17g/t Gold

§               Juno                               0.8Moz @ 56g/t Gold

§               White Devil                     0.8Moz @ 15g/t Gold

Late last year, Westgold and the local Traditional Aboriginal Owners successfully completed negotiations and have signed an agreement covering this exciting prospect and the surrounding highly prospective areas. The recent grant of tenements and exploration approvals by the Northern Territory Government allows for exploration at Rover 1 and other priority targets to re-commence after a 25-year hiatus.

Importantly, the Company recently announced a significant Zn-Pb-Ag Inferred Resource at the nearby Explorer 108 deposit comprising 8.7 Mt at 5.6% combined Pb & Zn, 20g/t Ag, 0.3g/t Au using a lower cut-off grade of 2.5% combined Pb+Zn and contains a higher grade component of 4.0 Mt at 8.2% combined Pb & Zn, 25g/t Ag, 0.3g/t Au using a 5% combined Pb+Zn cut-off. This large mineralised system remains open in most directions and the Company is confident further drilling will extend the mineralisation significantly.

Since acquiring the Rover Field Project, Westgold has made significant progress, much of which has come about by building a strong relationship with the local Traditional Aboriginal Owners. The Company is focused on further discoveries and future development in the Rover Field.

Westgold will have 142.5 million shares on issue and 3.1 million unlisted options following completion of the Rights Issue.

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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