Sep. 20, 2010 (Canada NewsWire Group) --
/THIS NEWS RELEASE IS NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. NEWS AGENCIES/
<< TSX Venture Exchange: PMV Issued & Outstanding: 253,421,537 Frankfurt: AOJMW7 Fully Diluted: 363,864,185 >>
Confirms plans to undertake an Initial Public Offer and listing in Australia in November 2010
<< Highlights: - PMI Gold to raise C$5 million to accelerate Ghana drilling ahead of planned Australian public offering - 16,000 metre drill campaign to commence in first week of October at the Obotan Project to increase and elevate NI43-101/JORC Mineral Resource confidence level - 4,000 metre drill campaign to commence immediately at Kubi Project to test the 513 Zone Discovery and other new high priority targets - Macquarie Bank to increase its stake in PMI Gold to 19.7% - Share consolidation planned to facilitate IPO in Australia - Proposed IPO in Australia on track for November 2010, with Hartleys Limited as Lead Broker >>
VANCOUVER, Sept. 20 /CNW/ - PMI Gold Corporation (TSX.V: PMV): Douglas MacQuarrie President & CEO is pleased to announce that the Company has received commitments from accredited investors to raise a total of up to C$5 million, primarily to accelerate and expand resource drilling programs at its two flagship gold projects in Ghana, West Africa.
The funds will be raised through the issuance of up to 27,777,778 common shares at $0.18 per common share. Commissions of up to 6% are payable on the subscriptions. The private placement is subject to receipt of necessary stock exchange approvals.
The proceeds will be used primarily to fund 20,000 metres of drilling at the Obotan and Kubi Gold Projects, to upgrade and expand existing resources, and to provide additional working capital ahead of the Company's planned IPO in Australia later this year.
The Company is also pleased to report that on closing of this financing, Macquarie Bank Limited ("Macquarie") of Australia will hold a 19.7% interest in the issued capital of the Company on a partially diluted basis.
Macquarie is a leading provider of services and products to the global resources industry including equity, debt and mezzanine financing, and has over 15 years' experience in successfully funding gold projects in West Africa into production. Macquarie has been a cornerstone/major investor in a number of successful West African gold companies including RedBack Mining, Perseus Mining, Gryphon Mining and Adamus Resources, amongst others, assisting them to advance from the development stage through to production.
Expanded Ghana Gold Drilling Program
At Obotan, drilling will commence in the first week of October, and will include 16,000 metres of in-fill drilling to upgrade and expand the existing gold resources, and to target gold mineralization down-dip of previous mining, where recent results at Nkran have included intersections to 153.40 metres @ 2.37g/t Au, including 46.0 metres @ 5.23g/t Au from the base of the pit at -140 metres to -280 metres in depth. Geotechnical and other engineering and environmental studies will also be initiated.
The Nkran deposit was previously mined over a length of 600 metres and to a depth of circa 140 metres prior to its closing in late 2002 when gold was US$320 per oz. Drilling clearly demonstrates that the deposit plunges to depth - with the deepest mineralized intersections at over 400 metres below the pit base. In the core of the deposit true widths of 40 metres are typical.
Current NI43-101 Mineral Resource estimates for Obotan in the Nkran and satellite Abore, Adubiaso and Asuadi deposits total 1,053,000 oz Au @ 2.1g/t Inferred and 156,000 oz Au @ 1.59g/t Indicated (please see: http://www.pmigoldcorp.com/i/pdf/2010-08-31_NR.pdf).
At Kubi, 4,000 metres of drilling will commence immediately to target the 513 Zone gold discovery, located 1.2km west of the Kubi Main gold deposit (NI43-101 Mineral Resource estimate of 604,000 oz Au @ 3.66g/t Indicated and 315,000 oz Au @ 1.88g/t Inferred, please see our news release: http://www.pmigoldcorp.com/i/pdf/2008-04-10_NR.pdf), and numerous other high priority auger geochemical/geophysical and structural targets, including targets located under heavy alluvial cover with historical and current alluvial gold operations.
Update on Australian Initial Public Offering
The Company also advises that its Australian IPO is progressing well, and is expected to be completed in early November 2010. Hartleys, a leading Australian resource broker, is assisting the Company as Lead Broker to the Offer.
To facilitate the Australian public offering, the Company will undertake a consolidation of its outstanding capital on the basis of 1 new common share for every 4 existing common shares, subject to final advice from the Australian Regulatory Authorities.
Douglas R. MacQuarrie, PMI Gold's President and CEO, commented: "This $5 million raising, which has been strongly supported by both Macquarie and Hartleys, will further strengthen our balance sheet and enable us to maintain a very aggressive pace of gold exploration drilling in Ghana while we finalise our proposed Australian IPO."
"This raising, in conjunction with a moderate tightening of our share capital, advances the restructuring of PMI Gold in anticipation of the Australian IPO."
"With the Australian IPO on track for early November 2010, it is with great confidence that I and all of our shareholders in Africa, Europe, Australia, and North America should look forward to the coming years and our transformation from a gold explorer to a gold producer."
On behalf of the Board,
"Douglas R. MacQuarrie"
President & CEO
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains forward-looking statements which involve known and unknown risks, delays and uncertainties not under the Company's control which may cause actual results, performance or achievements of the Company to be materially different from the results, performance or expectations implied by these forward-looking statements. We Seek Safe Harbour.
About PMI Gold
Mining analysts have recently stated that West Africa will soon become the World's second largest gold producing region, after China. Ghana is by far the largest gold producer in West Africa, and PMI Gold controls four previous operating mines on 85 kilometres of Ghana's major gold belts, located near the centre of some 200 million ounces of historical production and current gold resources. Our Kubi Gold Project adjoins the 60 million ounce AngloGold Ashanti Obuasi mine, the largest underground mine in West Africa with a 113 year, continuous mining history. At Obotan, where previous mining to 2003 yielded 730,000 ounces at a grade of 2.2 g/t Au, we announced a maiden +1 million ounce gold Mineral Resource estimate on August 31, 2010.
Douglas MacQuarrie, President & CEO, Telephone: 1 (604) 682-8089, Toll-Free: 1 (888) 682-8089, Facsimile: 1 (604) 682-8094; or for European Investors: Florian Riedl-Riedenstein: Tel: 43-2774-28814, e-mail: firstname.lastname@example.org; Or visit the PMI Gold Corporation website at www.pmigoldcorp.com