Apollo Gold Corporation Signs Letter of Intent to Acquire Stock Mill and Related Assets from St Andrew Goldfields Ltd.
Apollo Gold Corporation (TSX:APG) (AMEX:AGT) and St Andrew
Goldfields Ltd. (TSX:SAS) announced that they have signed a
non-binding letter of intent pursuant to which St Andrew will sell its
Stock Mine property, including its mill and related equipment,
infrastructure, laboratory and tailings facilities, located near
Timmins, Ontario, to Apollo Gold for a purchase price of $20 million.
The purchase price will be paid in two installments, with the first
installment of $1.5million to be paid on closing and with the
balance to be paid on or about June 30, 2008. Apollo will also be
responsible for the refund to St Andrew of its bonding commitment at the
Stock Mine of approximately $1.2 million. The Stock Mill was in
operation until May 2007 and processed, in the past, approximately 1
million tonnes of ore from the Glimmer mine, the former mining operation
situated at the current location of the Black Fox deposit.
Completion of the transaction is subject to satisfactory completion of
due diligence and Board approval by Apollo Gold, Board approval by St
Andrew, the negotiation and execution of definitive agreements,
regulatory approval and other customary conditions and is expected to be
completed on or about April 17, 2008.
Jacques Perron, President and CEO of St Andrew, said, “As
we did not have any plan for the Stock Mill in the foreseeable future
this divestiture is part of our program to dispose of non-core assets.
The proceeds from this transaction will provide support to St Andrew’s
financial requirements for its development strategy in the Timmins Camp.
Moreover, as St Andrew is a major Apollo Gold shareholder, we believe
that this transaction will significantly improve the plans for the Black
Fox project and will benefit St Andrew accordingly.”
R. David Russell, President and CEO of Apollo, said, “We
are looking forward to negotiating definitive documentation and
completing the acquisition of the Stock mill, property and associated
equipment with St Andrew. This strategic acquisition works nicely into
our overall strategy for the Black Fox project. If this acquisition is
closed, it will ensure that Apollo will be able to commence milling
operations early in 2009 and operating our own mill could potentially
have significant operational savings. The previously announced Full
Feasibility completion date of March 31, 2008 will now be April 14, 2008
to accommodate the Stock Mill acquisition.”
About Apollo Gold
Apollo is a gold mining and exploration company which operates the
Montana Tunnels Mine, which is a 50% joint venture with Elkhorn Tunnels,
LLC, in Montana, the Black Fox advanced stage development project in
Ontario, Canada, and the Huizopa project, an early stage exploration
project in the Sierra Madres in Chihuahua, Mexico.
About St Andrew
St Andrew is a gold mining and exploration company with operations in
Timmins, Ontario and Alaska. St Andrew controls a very large land
position in the Timmins Mining Camp, an extensive land position at Eskay
Creek in northern British Columbia and land positions around Nixon Fork
Gold Mine in the Kuskokwim-Tintina Mining Camp in Alaska. St Andrew also
holds an approximate 42.3% equity interest in New Zealand based gold
explorer Glass Earth Gold Limited which holds extensive land positions
on the North and South Islands in New Zealand, and an approximate 18.0%
equity interest in Apollo Gold Corporation, which has operations in
Montana, Mexico and the Black Fox Deposit located in the vicinity of St
Andrew’s Timmins operations.
This news release contains forward-looking information under applicable
securities laws, including statements regarding the completion of the
sale of the Stock Mine property, the timing of the completion of a
feasibility study and our ability to commence milling operations in
2009. Forward looking information is subject to known and unknown risks,
uncertainties and other factors that may cause actual results to differ
materially from those implied by the forward-looking information and
there can be no assurance that the purchase and sale of the Stock Mine
property will be consummated. Reference should be had to the most recent
Annual Information Forms of St Andrew and Apollo Gold respectively for a
discussion of the risks and uncertainties impacting on St Andrew and
Apollo Gold, respectively, which are available at www.sedar.com.
