VANCOUVER, BRITISH COLUMBIA, Nov 06 (MARKET WIRE) --
Gold Wheaton Gold Corp. (TSX VENTURE: GLW) ("GWC") is pleased to announce
that Gold Wheaton (Barbados) Corporation ("Gold Wheaton"), a wholly-owned
subsidiary of GWC, has signed a definitive agreement with First Uranium
Corporation (TSX: FIU)(JSE: FUM) ("First Uranium") and its subsidiary
Ezulwini Mining Company (Proprietary) Limited ("EMC"). Gold Wheaton will
purchase seven percent of the life of mine gold production from EMC's
mining right over the Ezulwini Mine (the "Transaction") and which covers
an area of approximately 3,718 hectares, located approximately 40
kilometres from Johannesburg, in the Province of Gauteng, in the Western
portion of the Witwatersrand basin, South Africa.
The Transaction is expected to close in late November 2009.
Under the terms of the Transaction, Gold Wheaton will pay First Uranium
US$50 million on closing and will make an ongoing payment equal to the
lesser of US$400 per delivered ounce and the prevailing spot price of
gold, subject to an annual inflation adjustment of one percent, starting
on the fourth anniversary of closing. Gold Wheaton will not be required
to contribute to any capital or exploration expenditures in respect of
the Ezulwini Mine.
EMC has redeveloped the old North Section of the Western Areas gold mine
(in operation since the early 1960s) with a new mining area being opened
up and a new gold and uranium processing plant recently constructed and
commissioned. The operation has extensive existing infrastructure,
relatively shallow mining operations and by-product uranium credits. The
mining and processing operations are currently ramping up to design
production levels.
"With this new gold stream from Ezulwini, one of First Uranium's two
South African operations, we add an average of approximately 25,000
ounces per year over the life of the operation to our existing annual
production. The long life gold and uranium mine should be at the lower
end of the production cost curve and has significant potential upside for
additional production from its large resource base. The transaction will
be financed from cash on hand, leaving us well funded to continue to
grow," commented David Cohen, Chairman and CEO of GWC. "As the mine is
currently ramping up production, we expect to receive immediate
additional production from the transaction, a guaranteed minimum delivery
of 16,500 ounces in 2010 and 19,500 ounces in 2011 and an average annual
delivery of approximately 26,000 ounces thereafter. We are pleased to
solidify our existing relationship through this second transaction with
First Uranium, adding to the initial agreement with respect to their Mine
Waste Solutions project in November 2008."
Closing of the Transaction is subject to receipt of all required
governmental, regulatory and stock exchange approvals and third-party
consents.
GWC will also call and hold a special meeting of shareholders to approve
a consolidation of the common shares of GWC on the basis of 1 new common
share for every 10 issued and outstanding common shares. No fractional
shares will be issued and any fractions of a share will be rounded down
to the nearest whole number of common shares.
At today's date, GWC has 1,430,496,668 issued and outstanding shares and
post-consolidation, GWC will have 143,049,666 issued and outstanding
shares. Upon the consolidation outstanding stock options and warrants
will, in accordance with their terms, be exercisable into
post-consolidation shares at appropriately adjusted exercise prices.
The share consolidation is subject to shareholder approval and TSX
Venture Exchange acceptance.
GWC will release third quarter results on Tuesday November 10th, 2009
after the market closes and will host a telephone conference call,
Thursday November 12th, 2009, at 10:00am PST (1:00pm EST) to discuss the
results. The impact of the Ezulwini transaction will also be discussed at
that time. The conference call may be accessed by dialing 1-800-319-4610
in Canada and the United States, or +1-604-638-5340 internationally.
The conference call will be archived for later playback until Thursday
November 19th, 2009 and can be accessed by dialling +1-604-638-9010 or
1-800-319-6413 and using the pass code 3504 followed by the number sign,
#.
Cautionary Note Regarding Forward-Looking Statements
Safe Harbor Statement under the United States Private Securities
Litigation Reform Act of 1995: Except for the statements of historical
fact contained herein, the information presented constitutes
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements, including
but not limited to those with respect to the price of gold, platinum or
palladium, the timing and amount of estimated future production, costs of
production, reserve determination reserves conversion rates and the
proposed consolidation involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or
achievements of GWC or First Uranium to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among other risks,
risks related to the integration of acquisitions, risks related to
international operations, risks related to joint venture operations, the
actual results of current exploration activities, actual results of
current reclamation activities, conclusions of economic evaluations and
changes in project parameters as plans continue to be refined as well as
future prices of gold, platinum or palladium, as well as those factors
discussed in the section entitled "Description of Business - Risk
Factors" in GWC's Annual Information Form dated August 19, 2008 as filed
on SEDAR. Although GWC has attempted to identify important factors that
could cause actual results to differ materially, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to be
accurate as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy and accuracy of the content of this news
release.
Contacts:
Gold Wheaton Gold Corp.
David Cohen
Chairman and Chief Executive Officer
+1 (778) 373-0107
www.goldwheaton.com
Copyright 2009, Market Wire, All rights reserved.
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