SearchGold Reorganizes Diamond Assets and Obtains a 11.8% Stake in Stellar Diamonds Limited
MONTREAL, QUEBEC, Jun 20, 2007 (CCNMatthews via COMTEX News Network) --
SearchGold Resources Inc. (TSX VENTURE:RSG) (FRANKFURT:S1O) is pleased to announce the reorganization of its diamond assets, namely the Mandala-Ouria Diamond Project located in Guinea, Africa.
In order to segment its activities and unlock value for its shareholders, SearchGold has re-organized its diamond assets along with its AIM (MANA) and TSX-V (MNO) listed partner, Mano River Resources ("Mano"), to create an integrated diamond company. The new company called Stellar Diamonds Limited ("Stellar") has acquired a 100% interest in Mano's diamond assets in Liberia, Sierra Leone and Guinea. Stellar has also acquired from SearchGold its 50% interest in the Guinean joint venture company, Guinean Diamond Corporation Limited, which holds the Bouro/Mandala alluvial project. In consideration for these acquisitions, Stellar has issued 22 million shares at a price of 0.87 pounds sterling. As a result of the transaction SearchGold holds 2.7 million shares of Stellar, or 11.8% of the company while Mano, as majority shareholder, holds 19.3 million shares of Stellar, or 83% of the company. A local minority shareholder holds 137,000 shares of Stellar. Seed investors in Stellar hold the balance of the shares of Stellar. The directors of Stellar valued the assets at 23.9 million pounds sterling, which was supported by a private, independent report by MPH Consulting Limited, completed on 1st March 2007.
Philippe Giaro, President and CEO, stated "We are very pleased with this transaction which allows us to develop Mandala-Ouria while giving SearchGold an opportunity to take part in the creation of a new company with an exclusive focus on diamonds and which holds outstanding properties in one of the world's richest diamond province. Stellar's management, a team of well recognized diamond experts, is exceptionally well suited to aggressively develop the Company. Moreover, this transaction allows the original partners to significantly fund all diamond projects without further diluting either SearchGold or Mano".
Financing
Stellar has completed a private placement of 800,000 pounds sterling. The funds were raised to maintain Stellar's equity interests in its various on-going JV projects in 2007. A further pre-IPO financing is currently being undertaken, the proceeds of which will be used to advance Stellar's exploration and development programmes. Stellar is planning to be listed on London's alternative investment market (AIM).
Appointment of VP Exploration, Stellar
Mr. Rowan Carr has joined Stellar as Vice President of Exploration. Rowan brings with him over 20 years of African diamond exploration and management experience gained with the De Beers group of companies, having managed diamond projects in Botswana, South Africa, Angola, Guinea, Central African Republic and the Democratic Republic of Congo. In addition Rowan was also the technical manager of the De Beers' largest mineral processing laboratory in Kimberley.
About Stellar Diamonds Limited
Stellar Diamonds will be an integrated diamond miner and explorer with a focus on West and Central Africa. The Company's portfolio of diamond properties and joint ventures in West Africa is summarized as follows:
- A 49% interest in a JV with Petra Diamonds on the Lion Kimberlite Dykes project in the Kono diamond fields of Sierra Leone, with underground diamond production planned to commence in late 2007. A 75-tonne per hour processing plant is already built and exploration shaft sinking is being conducted on numerous diamond bearing kimberlite dykes.
- A 50% interest in a JV with Trans Hex Group in the Weasua cluster of diamondiferous kimberlite pipes in Liberia, where bulk sampling to determine diamond grades and value is currently underway.
- A 100% interest in the Mandala alluvial and Bouro kimberlite dyke project in Guinea, where a non-43-101 indicated alluvial diamond resource of 550,000 carats has been established and where high grade kimberlite dykes are present.
- A 15,000 km2 reconnaissance licence in western Liberia where diamond bearing kimberlites and numerous high interest mineral indicator anomalies have been discovered.
- A JV with BHP Billiton, who are earning into an initial 51% interest in the south-eastern Sierra Leone tenements. The joint venture has located a high-grade diamond bearing extension of the high grade Tongo dyke field.
- Two licences in south east Sierra Leone where kimberlite has been discovered and indicator mineral anomalies require further follow up work.
- A JV with African Aura in Liberia where exploration is ongoing to earn into a 78% interest in the diamond rights of the 400 km2 north Bea exploration project.
- A 100% held interest in the diamond rights of the 1,000 km2 Bea MDA licence in Liberia where indicator mineral anomalies have been generated and require further follow up work.
- An agreement with De Beers to access their regional Guinea database, where an independent consultant has reviewed the data and target selection is now ongoing.
About SearchGold Resources Inc.
SearchGold Resources is a Canadian-based mining exploration company whose primary mission is to target, explore and develop gold and diamond deposits in Africa and in Canada. The expansion strategy executed in 2006 has set the stage for the Company's development in 2007 as this new year will see increased activity on the new blue-sky properties and the advanced projects as well as some potential acquisitions.
If you would like to receive press releases via e-mail please contact: info@searchgold.ca
SOURCE: SearchGold Resources Inc.
