Vancouver, British Columbia, Canada. June 30th, 2011, Columbus Gold Corporation (CGT: TSX-V) ("Columbus Gold")
has closed its previously-announced transaction with Auplata SA ("Auplata"), thereby securing the exclusive right to obtain up to a 100% interest in the Paul Isnard gold project in French Guiana, which includes the 43-101 compliant 1.9 million Inferred gold resource in the Montagne d'Or gold deposit. Columbus Gold is aggressively moving forward to earn an initial 51% interest in the project.
Columbus Gold has fully satisfied the share issuances required to earn into the project, issuing 30,276,266 common shares to Auplata, and completing a 13,357,176 share private placement to Pelican Venture SAS for gross proceeds to Columbus Gold of $2,871,792.80. Columbus Gold has also issued 190,473 common shares as a finder's fee for this transaction. All of the foregoing shares are subject to a four month hold period expiring on October 30, 2011, and 20,184,177 of the shares issued to Auplata are also subject to an agreement that requires all of such shares to be held in escrow for two years until June 29, 2013.
Columbus Gold is now able to earn an initial 51% interest in the Paul Isnard project by incurring $7 million in exploration expenditures, which it expects to complete by early 2012. Upon Columbus Gold earning a 51% interest in the project, it will have an option to increase its interest to 100% (subject to an underlying royalty) by completing a bankable feasibility study.
Drilling is planned to commence in August 2011, focusing on the Montagne d'Or gold deposit where holes will be drilled up to 200 metres depth with the goal of increasing the mineral resources, and where infill drilling is expected to convert Inferred resources to Measured and Indicated categories. Future drill programs will target the eastern and western extensions of the Montagne d'Or deposit where more than 2.5 km of strike provides expansion potential, and will test numerous underdeveloped gold prospects and undrilled geochemical anomalies which occur throughout the project area.
The Paul Isnard gold project includes the 43-101 compliant 1.9 million ounce Inferred gold resource in the Montagne d'Or gold deposit which consists of 36.7 million tonnes grading 1.6 gpt. The Montagne d'Or gold deposit is open along strike and at depth. The project is located approximately 180 km west of the capital city of Cayenne, French Guiana and has been an important centre of alluvial and colluvial gold mining operations since the late 19th century with reported estimated production of about two million ounces.
The project occurs within the northernmost of two east-west trending Proterozoic greenstone belts making up the French Guiana sector of the Guiana Shield. Modern exploration at Paul Isnard includes geological, geochemical and geophysical surveys, and diamond core drilling carried out primarily from 1996 to 1999. Most of this work included 54 holes for 10,600 metres directed at the Montagne d'Or gold deposit which consists of a linear mineralized body within laminated felsic volcanic rocks outlined and partially delineated for a strike length of 2,000 metres and an average depth of 100-150 metres. The deposit consists of two closely spaced, mineralized layers, respectively averaging about 50 and 17.5 metres in thickness, and multiple smaller, sub parallel gold-bearing bands and stringer zones.
Columbus Gold's independent consultant and Qualified Person, John Prochnau (P. Geo), B.Sc. (Mining Engineering), M.Sc. (Geology), has reviewed and approved the technical content of this news release.
For additional information, please see Columbus Gold's prior news releases of December 3 and 22, 2010, January 17, May 26, and June 8 , 2011, and Columbus Gold's Management Information Circular dated April 15, 2011.
About Columbus Gold
Columbus Gold is a gold exploration and development company operating in French Guiana and Nevada. In French Guiana, Columbus Gold can earn up to a 100% interest in the Paul Isnard gold project, which has a 43-101 compliant 1.9 million ounce Inferred gold resource and substantial expansion potential. In Nevada, Columbus is a prolific project generator focused on advancing projects either through joint-venture with industry partners or on its own where exploration risk is minimized and potential is particularly promising. Exploration activities are managed by Cordex which is owned and operated by Andy Wallace who has a long and successful history of gold discovery and mine development. Columbus Gold currently has 12 of its 26 strategically located gold projects in Nevada joint ventured to major and junior mining companies, including Agnico-Eagle Mines Limited.
ON BEHALF OF THE BOARD,
Chairman & CEO
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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This release contains forward-looking information and statements, as defined by law including without limitation Canadian securities laws and the "safe harbor" provisions of the US Private Securities Litigation Reform Act of 1995 ("forward-looking statements"), respecting drilling, earning in to the Paul Isnard property, and Columbus Gold's general exploration plans. Forward-looking statements may be identified by terms such as "expects," "looks forward to," "will test," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "will," "project" or words of similar meaning. Forward-looking statements involve risks, uncertainties and other factors that may cause actual results to be materially different from those expressed or implied by the forward-looking statements, including without limitation the ability to acquire necessary permits and other authorizations; environmental compliance; cost increases; availability of qualified workers and drill equipment; competition for mining properties; risks associated with exploration projects, mineral reserve and resource estimates (including the risk of assumption and methodology errors); dependence on third parties for services; non-performance by contractual counterparties; title risks; and general business and economic conditions. Additional considerations include the timeliness of the foregoing (in order to meet exploration deadlines in connection with earning into the property), and the desirability of continuing to earn into the property as more information becomes available to Columbus Gold due to the analysis of results of ongoing drilling and exploration work conducted. Forward-looking statements are based on a number of assumptions that may prove to be incorrect, including without limitation assumptions about: general business and economic conditions; the timing and receipt of required approvals; availability of financing; power prices; ability to procure equipment and supplies including without limitation drill rigs; that Columbus Gold will continue to desire to earn into the property; that Columbus Gold's work on the property will be completed in a timely fashion; and ongoing relations with employees, partners and joint venturers. The foregoing list is not exhaustive and we undertake no obligation to update any of the foregoing except as required by law.