ECR Minerals: A $9M Sale of South African Exploration Assets by West Wits Mining
ECR Minerals: A $9M Sale of South African Exploration Assets by West Wits Mining
ECR Minerals plc
ECR Minerals plc is pleased to draw attention to the West Wits Mining Ltd (“West Wits”) news release made on 25 January 2012 and summarised below.
Highlights
- West Wits has agreed to sell to a South African consortium the West Wits Lease, West Rand Consolidated Lease, Luipaardsvlei Lease and East Champ D’Or Lease for A$9 million on milestones
- First A$4 million will be received as an upfront payment on completion of the 30 day due diligence period and signing of definitive agreements
- West Wits will retain the DRD Lease and Rand Leases which contain JORC 287,000oz Au and the major uranium targets
- West Wits is now well funded to complete its initial alluvial circuit and begin its exploration programs at Derewo River, Indonesia
The full release can be viewed at West Wits’ website (www.westwitsmining.com). The highlights above have been extracted from the release made by West Wits and should be read in conjunction with it.
The Derewo River project in Papua Province, Indonesia covers approximately 129,000 hectares of mining and exploration tenements. The project is a joint venture between West Wits and a local party. West Wits has a 50% interest in the project, and can increase its interest in the exploration tenements to 80%. West Wits acquired its stake in the project from Paniai Gold Ltd (“Paniai Gold”) in July 2011.
Patrick Harford, Managing Director of ECR Minerals plc, comments:
“West Wits now looks set to substantially improve its financial position without the issue of new equity and has stated that the proceeds of the sale of the four leases will be principally applied to development of the Derewo River project, the objectives of which include the commencement of alluvial gold production in the near future.
This vindicates the decision taken by ECR in 2009 to place the Derewo River project in a dedicated corporation, Paniai Gold, as well as Paniai’s decision to sell the project on to West Wits in exchange for shares, performance shares and options.
ECR shareholders have twofold exposure to the Derewo River project, firstly through ECR’s 4% shareholding in West Wits and secondly through the Company’s 26% shareholding in Paniai Gold.
We note that technical due diligence has already been carried out to the satisfaction of the consortium purchasing the South African leases, leaving only legal due diligence outstanding, and on this basis we feel confident that the sale of the leases will proceed to completion.”
ECR’s Interest in West Wits and Paniai Gold
ECR holds 11,149,826 ordinary shares of West Wits, which are traded on the Australian Securities Exchange (code: WWI), and 100 million ordinary shares of Paniai Gold, a private company. ECR’s holdings are equivalent to approximately 4% and 26% of the issued shares of West Wits and Paniai respectively.
Paniai holds 46 million West Wits performance shares and 12.5 million options exercisable at A$0.08 and expiring on 28 July 2016. The performance shares convert to ordinary shares subject to the Derewo River project achieving the production of 20,000oz gold by 28 July 2013. On conversion of the performance shares and exercise of its options, Paniai would hold 18% of West Wits’ ordinary shares (based on the number of ordinary shares currently outstanding).
About ECR Minerals plc
ECR is a mineral development company with interests in Argentina, the USA, Indonesia, Thailand and Australia.
ECR Minerals plc
Michael Silver, Chairman
Patrick
Harford, Managing Director
Stephen Clayson, Director & Chief
Financial Officer
Luca Tenuta, Non-Executive Director
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