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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (34445)	2/28/2007 9:43:15 AM
From: LoneClone	Read Replies (3) \| Respond to of 78424

Central African Gold Buys Two Zimbabwe Gold Mines By Charlotte Mathews 27 Feb 2007 at 09:27 AM GMT-05:00 resourceinvestor.com JOHANNESBURG (Business Day) -- Central African Gold [AIM:CAN], the Alternative Investment Market-quoted gold mining company that recently bought AngloGold's [NYSE:AU] Bibiani mine in Ghana, has bought two Zimbabwean gold mines owned by JSE-listed Halogen Holdings [JSE:HAL]. Central African has paid about £3.2 million ($6.28 million) in cash and shares for 84.7% of Falcon Gold [ZSE:FALGOLD], which is listed on the Zimbabwe stock exchange, and for 100% of unlisted Olympus Gold Mines. The combined resources for both mines is 2.48 million ounces of gold and their reserves are 632,000 ounces. In the year to September their combined turnover was about £3.75 million ($7.37 million) and their profit was about £409,045 ($803,956) on production of 21,031 ounces of gold. --> Central African would revise and update the mineral reserves and apply modern and efficient mining techniques to improve the productivity and profitability of the mines, it said. Halogen said in December it was looking for ways to realise value from the two mines, which were operating on a hand-to-mouth basis because of the Zimbabwean government's policy of buying gold at below global prices. The mines are Halogen's only operating assets, though they have not been consolidated since 2002. However, the listed entity also holds about £2 million ($3.93 million) in cash for which it is seeking opportunities. CEO Greg Hunter said yesterday Central African would retain Falcon's listing in Zimbabwe, which would make it possible to raise local funds for investment in the mine and provide an important local shareholder base. Central African could also consider vending Olympus into the Falcon Gold listing. Hunter said Zimbabwean gold mines were required to sell their gold to the government-owned refinery and were paid for it 75% in foreign currency and 25% in local currency, but at three times the official rate. Hunter's experience was that at times, after a central bank rate adjustment, Zimbabwean gold mines benefited from this system and at other times it was more difficult. Hunter said the Zimbabwe government's indigenisation programme scorecard was being worked on. Given credit for Falcon Gold's local shareholders and investment in local infrastructure, the ultimate ownership of the assets could be 30% government, 70% private sector. Hunter said he was as confident of security of tenure in Zimbabwe as he was in the Democratic Republic of Congo. The mines offered excellent geology, skilled employees and infrastructure in reasonable shape which could be ramped up quickly.