Dec 9 2013
True Gold Mining Inc. ("True Gold" or the "Company") is pleased to announce that the Company has exercised its option to acquire the remaining 10% interest (the "Interest") in the Goulagou and Rounga permits (the "Permits"), two of the six permits comprising the Karma Gold Project ("Karma Project") in Burkina Faso, West Africa.
Pursuant to the original terms, the option was exercisable for consideration of US$1 million and a 5% net profits interest but not until the commencement of commercial production. True Gold has negotiated the early exercise of its option to purchase the Interest for consideration consisting of US$500,000, the issue of 1,773,500 common shares (the "Consideration Shares") of True Gold, and a 5% net profits interest on the Permits.
"Today's agreement simplifies the Company's corporate structure as we advance the Karma Project," said Dwayne Melrose, President and CEO, True Gold.
The 856-square-kilometre Karma Project includes five closely spaced deposits - Kao, Goulagou I, Goulagou II, Rambo and Nami. The Goulagou I and II deposits are within the Goulagou permit boundary. True Gold has applied for exploitation (mining) permits on four of the five Karma Project deposits, including Goulagou I and II.
The Rounga permit, in the northern portion of the Karma Project, offers many highly prospective priority drill targets including Watinoma, where True Gold drilling intersected 1.91 g/t Au over 70.5 metres in August 20131.
The Karma Project is currently undergoing a feasibility study, which entails the development of a fully engineered construction and operating plan for a proposed low cap-ex, open-pit, heap-leach mine2.
The acquisition of the Interest is subject to regulatory approval. No finder's fees or commissions will be paid by the Company in connection with the acquisition of the Interest. The Consideration Shares will be subject to a four-month hold period from the date of issue.
1Please see True Gold news release dated August 20, 2013
2The Company has not made a production decision and the Company's strategic plan to develop a stand-alone heap leach operation at the Karma Project is subject to the results of a feasibility study, which is currently underway. Further, if and when the Company makes any production decision, it will disclose the basis of such decision in accordance with the requirements of NI 43-101
About True Gold
True Gold Mining Inc. is where gold comes to life. We are committed to growing a profitable gold exploration, development and production company, by focusing on projects with low costs, low technical risks and solid economics. The Company's board, management and technical teams have proven track records in gold exploration, development, operations and production worldwide.
Additional information about the Company and its activities may be found on the Company's website at www.truegoldmining.com and under the Company's profile at www.sedar.com.
ON BEHALF OF THE BOARD
Dwayne Melrose, President & CEO