Vancouver, B.C., May 21, 2013 - Columbus Gold Corp. (CGT: TSX-V
) ("Columbus Gold
") is pleased to announce that it has completed the sale of a 1% net smelter returns royalty ("NSR
") on production from its 100%-owned Paul Isnard gold project in French Guiana. The transaction has been completed with a royalty company for proceeds of US$5 million cash, which has been received by Columbus Gold.
Robert Giustra, CEO of Columbus Gold, commented: "Despite the prevailing inhospitable market conditions characterizing the mining sector, we have not only generated significant capital; we have done so without issuing any shares. This transaction clearly demonstrates our continued dedication to protecting our shareholders from dilution." Mr. Giustra further added: "With the proceeds of the royalty sale, Columbus Gold now has some $8.5 million in treasury, placing us in a favorable position respecting the advancement of our Paul Isnard gold project."
With the addition of the above-noted royalty and upon Columbus Gold exercising its option to reduce the existing royalty (the "Option Over Royalty
") held by Euro Ressources SA (a company in which IAMGOLD holds a majority 86% interest), the Paul Isnard Project will have an aggregate NSR royalty of 2.8% on the first 2 million ounces produced, 1.9% on the next 3 million ounces produced, and 1% thereafter. For additional details on the Option Over Royalty, please see Columbus Gold's news release of July 26, 2012.
ON BEHALF OF THE BOARD,
Robert F. Giustra
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.
For more information contact:
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 the Option Over Royalty, the aggregate NSR on the Paul Isnard Project, and future exploration work at the Paul Isnard Project. 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 that Columbus Gold may or may not decide to exercise the option underlying the Option Over Royalty (the "Option"); the ability to acquire necessary permits and other authorizations; the ability to locate sufficient prospectus and registration exemptions to allow Columbus Gold to issue Shares in connection with the Option; the ability of Columbus Gold to pay the cash consideration in connection with the Option and also to keep the Option Over Royalty in good standing; the feasibility of taking Paul Isnard into production, and if Paul Isnard reaches production, whether the extent of such production will reach 2, 3, or 5 million ounces as described in connection with the calculation of the NSR royalties thereon; that production may never occur at the Paul Isnard Project; whether Columbus Gold will issue additional royalties on the Paul Isnard Project; 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. Forward-looking statements are based on a number of assumptions that may prove to be incorrect, including without limitation assumptions: that Columbus Gold will ultimately exercise the Option, and will have sufficient resources in order to do so; that Columbus Gold will identify and employ prospectus and registration exemptions required in connection with share issuances due under the Option; that Columbus Gold will hold necessary capital to make the cash payment due under the Option when and if due; that production will occur at the Paul Isnard Project; that no further royalties will be granted on the Paul Isnard project; 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; and ongoing relations with employees, partners and joint venturers. Although Columbus Gold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Columbus Gold undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable law. The reader is cautioned not to place undue reliance on forward-looking statements.