MYNG in at .11 today.. long awaited news:
Golden Eagle Celebrates Its Own Independence Day for Bolivian Gold Mine
Company Buys Out Coop's Entire Interest in Historic Cangalli Gold Deposit
SALT LAKE CITY--(BUSINESS WIRE)--July 3, 2002--Golden Eagle International Inc. (OTCBB:MYNG - News) Wednesday announced that it has purchased a 100 percent interest in the original Cangalli gold concessions owned by the United Cangalli Gold Mining Cooperative Ltd.
These concessions were the subject of Golden Eagle's exploration and mining contract entered into with the United Cangalli Coop in January of 1996.
Golden Eagle's president and chief executive officer, Terry C. Turner, stated, "Golden Eagle is celebrating its Independence Day early this year with its own brand of fireworks. The acquisition of these properties frees our future operations from the burden of the 18 percent gross royalty that we had under the previous contract with the United Cangalli Coop.
"We are free from the `Cooperative Risk Factor' that we have disclosed in our reports for the past six years. We are the free-and-clear owners of the property in which we have invested the bulk of our exploration and development dollars. We are now free to put this property into unencumbered production in our projected first-phase of operation."
Tuesday evening, July 2, 2002, company representatives in a ceremony in Golden Eagle's offices in La Paz, Bolivia, signed a definitive purchase agreement with the board of directors and membership representatives of the United Cangalli Gold Mining Cooperative Ltd. for the acquisition of the original Cangalli gold concessions, which today contain 5,125 acres.
This purchase agreement was previously approved by a binding unanimous vote of the Coop's General Assembly.
The purchase price consists of $300,000 in cash, which was immediately paid into escrow; 4,130,000 shares of Golden Eagle's restricted common stock valued at $0.10 per share; and the assumption by the company of $175,000 of the United Cangalli Coop's debt payable over the next several years on terms to be negotiated by the company with Coop creditors.
The company also agreed in a separate lease agreement to lease the use of the 1,000-foot deep Cangalli shaft back to the Coop for a period of 99 years, with a 10 percent gross royalty back to the company, so that those Coop members not working for Golden Eagle can remain involved in gold mining in their own community.
The United Cangalli Coop leadership intends to distribute 35,000 shares of Golden Eagle's common restricted stock to each Coop member. This distribution will be accomplished pursuant to the provisions of Regulation S, which will prevent the shares from flowing back into the United States markets for at least one year.
Golden Eagle must pay one-time transfer taxes of $9,000. The company must also pay $2,075 per year to the Bolivian government in mining patent fees to maintain the properties in perpetuity.
Golden Eagle's vice president for development, Ronald Atwood, Ph.D., former chief metallurgist for Newmont Gold, explained, "I could not be more satisfied as the officer in this company who will bring our production facilities on-line in Cangalli. In Operations, we have looked forward to this day for several years, although we understand that there are more hurdles that we have to overcome.
"When we reach our production phase, the elimination of the 18 percent gross royalty will bring greater profitability. Even with the royalty, we were projecting an extremely low cost of gold produced of less than $75 per ounce. Now, we estimate that the absence of a gross royalty may push that cost-per-ounce number even lower.
"Also, we believe that the elimination of the `Cooperative Risk Factor' will make our operations in the Tipuani Gold Zone more secure. And, the concept that more than 100 families in Cangalli, Bolivia are going to be shareholders in Golden Eagle -- our partners in the truest sense -- adds to the significance of this acquisition.
"Our Operations Division feels a new excitement in the air and a new challenge to bring our projected first-phase 1,000 ton-per-day plant on-line by our estimated start-up date in September 2002, and then expand up, as funds become available, to our projected 11,000 ton-per-day operation."
Mac Delozier, Golden Eagle's vice president for administration, and a 35-year veteran of Bolivia, put this critical land acquisition into perspective: "We have struggled to buy up shares in the United Cangalli Coop for years to acquire the Cangalli property that way.
"It became apparent that the Coop members had their own deeply held history and identity, so we opted for the straight land purchase and for making the Coop's members into shareholders and partners with us in Golden Eagle -- definitely a win/win situation.
"Plus, the Coop members can continue under lease to work in the deep shaft that has always been their pride and joy, but which does not figure into our mine plan."
The newly acquired 5,125 acres, added to Golden Eagle's solely owned landholdings in the Tipuani Gold Mining District, bring the company's total ownership to over 74,000 acres in an area that has produced more than 32 million ounces in its known history since the 16th century.
Max Staheli, former controller for operations for Barrick Gold Corp. in South America, and a Golden Eagle director, summed up Golden Eagle's land purchase this way: "If Golden Eagle had potential upside before, today's acquisition magnifies that upside several fold. With continued adequate financing, we are now in a position to take our own assets and make them grow in a less costly, more secure atmosphere."
Finally, Turner observed, "We are happy that Golden Eagle's Independence Day celebration coincides with America's. We wish everyone a joyous and safe Fourth of July."
Golden Eagle International Inc. is a gold exploration and mining company located in Salt Lake City and La Paz. The company is currently focusing its efforts on developing its mining rights on 74,000 acres in the Tipuani Gold Mining District in Western Bolivia, and continuing exploration on 125,000 acres in Eastern Bolivia's Precambrian Shield.
The company highly recommends that all shareholders and prospective shareholders should review its disclosures, risk statements, previous press releases, annual reports on Form 10-KSB, quarterly reports on Form 10-QSB and current reports on Form 8-K, found at its Web site: www.geii.com.
For more information about the company, call Sabrina Martinez in Investor Relations at 801/619-9320. Media inquiries should be directed to Jack McNamara at 801/619-9320.
Forward-Looking Statements and Disclosure of Risk
The future conduct of Golden Eagle's business and its response to issues raised by third parties are dependent upon a number of factors, and there can be no assurance that Golden Eagle will be able to conduct its operations as contemplated.
Certain statements contained in this release using the terms "may," "expects to," "projects," "estimates," "plans," and other terms denoting future possibilities, are forward-looking statements.
The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks that are beyond Golden Eagle's ability to predict or control and which may cause actual results to differ materially from the projections or estimates contained herein.
These risks include, but are not limited to, the risks described in the above press release; those risks set out in Golden Eagle's disclosure documents and its annual, quarterly and current reports; and the other risks associated with start-up mineral exploration operations with insufficient liquidity, negative working capital, and no historical profitability.
Golden Eagle disclaims any obligation to update any forward-looking statement made herein.
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Contact:
Golden Eagle International Inc., Salt Lake City
Sabrina Martinez, 801/619-9320 (Investor Relations)
Jack McNamara, 801/619-9320 (Media) |
