19th Apr 2007 07:01
Aurum Mining PLC19 April 2007 For immediate release 19 April 2007 AURUM MINING PLC ("Aurum" or "the Company") Andash Mine Construction Update Directorate Change Further re Deferred Consideration Aurum Mining plc (AIM: AUR), the gold-mining company focussed on the FormerSoviet Union, is pleased to announce that, following its recent £30 millionplacing to fund the development of an open-cast mine at Andash Zone 1 in theKyrgyz Republic, it has recently appointed additional key members of theoperations team to lead the construction and commissioning of the mine. Thedetailed design study is progressing and it is expected that construction workwill begin imminently with the production of gold and copper anticipated inearly 2008, thereby completing Aurum's transition from gold explorer toproducer. The operational management team, comprising Operations Director Jeff Geissmann,Financial Controller Andrew Howson, and Project Manager Norman Livingston, hassignificant combined international experience in the successful delivery ofmining and other projects, including projects in the FSU, and will augment theexisting Andash Mining Company team, which has been managing Aurum's activitiesin the Kyrgyz Republic. The new team members will work with Andash Mining Company's General Director,Oleg Kim, and Deputy General Director Erkinbek Kazakbaev, who will remainresponsible for all legal and procedural activities. As Aurum is now in the development stage, John Webster, a Non-Executive Directorof the Company, has agreed to be contracted directly to supply consulting andengineering services to the Company and as such he is expected to play a keyrole in the construction of the Andash mine. In order to allow Mr Webster tofulfil this role he will step down from the Board of the Company with effectfrom 1 May 2007. The proven and probable reserve at Andash Zone 1 contains gold and goldequivalent in copper of more than 1.2 million ozs. As a result of thesignificant extent of the resource, and as announced on 19 December 2006, themaximum deferred consideration of $5 million is payable under the terms ofAurum's acquisition in 2005 of the Andash project from Kaldora Company Limited,whose wholly owned subsidiary Andash Mining Company holds a licence over theAndash project. In accordance with the terms of the acquisition agreement theconsideration is being settled by the issue of 2,500,000 ordinary shares of 1peach (the "Ordinary Shares") in the Company at a fixed price of $2 per share(the "Deferred Consideration Shares") as follows: • 1,500,000 Deferred Consideration Shares to Kantanna Company Ltd, a company controlled by Oleg Kim, the general manager of the Andash project • 500,000 Deferred Consideration Shares to Jake Consultants Ltd, a company controlled by David Bryans, a consultant to Aurum • 500,000 Deferred Consideration Shares to John Webster. Following the allotment of the Deferred Consideration Shares, Oleg Kim andKantanna Company Ltd will hold 1,860,000 Ordinary Shares (representing 3.88 percent. of the Company's enlarged issued share capital and voting rights), DavidBryans and Jake Consultants Ltd will hold 2,870,000 Ordinary Shares(representing 5.89 per cent. of the Company's enlarged issued share capital andvoting rights) and John Webster and Clayhill Investments Corporation (a companycontrolled by John Webster) will hold 1,145,000 Ordinary Shares (representing2.39 per cent. of the Company's enlarged issued share capital and votingrights). Application has been made for the admission of the Deferred Consideration Sharesto trading on AIM which is anticipated to occur on 24 April 2007. Uponadmission, the Company's enlarged issued share capital will comprise 47,967,005Ordinary Shares with voting rights. The Company does not hold any shares intreasury. This figure of 47,967,005 Ordinary Shares may be used by shareholdersin the Company as the denominator for the calculations by which they willdetermine if they are required to notify their interest in, or a change in theirinterest in, the share capital of the Company under the FSA's Disclosure andTransparency Rules. No further deferred consideration will fall due in respect of the otherexploration Zones and areas within the Andash licence area, where significantpotential opportunities have been identified including a possible faultedextension to Zone 1. Mark Jones, Aurum Mining's Chief Executive Officer, said: "After raising £30million in equity to fully fund the Andash Zone 1 mine, one of the criticalsteps to the successful delivery of the project was the appointment of aneffective operational management team. I am delighted, so soon after thefundraising, to have appointed such an experienced extension to the team, whosecombined skills will ensure the successful delivery of the Andash mine. Initialproduction at Andash is on track for early 2008, allowing Aurum to complete thetransition from explorer to producer." For further information: Aurum Mining plc Tel: 020 7478 9050 Mark Jones, Chief Executive Officer Chris Eadie, Chief Financial Officer Arbuthnot Securities Tel: 020 7012 2000 Graham Swindells John Toll Buchanan Communications Tel: 020 7466 5000 Mark Court / Rebecca Skye Dietrich Notes to editors Aurum Mining, which joined the AIM market of the London Stock Exchange in May2004, is a mining company focussed on gold opportunities in the Former SovietUnion. Its principal asset is an exploration licence over the Andash gold andcopper project in the Kyrgyz Republic. A mining licence for Andash Zone 1 wasawarded by the Kyrgyz authorities in 2006. The bankable feasibility studycompiled by Wardell Armstrong International, also in 2006, confirmed a measuredand indicated resource base of 19.2 million tonnes at 1.1 grams per tonne ofgold and 0.4% copper, which equates to 1.1 million ozs of gold and goldequivalent. Initial production at Andash Zone 1 is expected in 2008. The Andashproject also includes Zone 2 and Zone 3 along with Tokhtonysay, Nakhodka andthree other additional exploration areas. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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