ECR Minerals Regulatory News (ECR)

20 Feb 2008 16:14

Mercator Gold PLC20 February 2008 Mercator Gold plc SALE OF EXPLORATION LEASES London: 20 February 2008 - Mercator Gold plc ("Mercator" or "the Company") ispleased to announce the sale of certain of its non-core exploration leases inthe Meekatharra district of Western Australia to Silver Swan Group Ltd ("SilverSwan"), an ASX listed company. The tenements are prospective for base metals,gold and industrial minerals*. The tenements being sold comprise 46 granted tenements and 14 grantedapplications covering approximately 600 sq km representing about 30% of theCompany's total land-holdings in the Meekatharra District. The consideration for the sale of the tenements to Silver Swan will be satisfiedby the issue to Mercator of 10,000,000 fully paid Silver Swan ordinary shares ofA$0.20 each and 4,000,000 Silver Swan performance shares. These performanceshares will convert to fully- paid ordinary shares subject to certain terms andconditions, the most notable of which is the proving up of 350,000 ounces ofgold, or gold equivalent, in to the indicated resource category. Silver Swanpresently has 23,350,001 shares in issue. Mercator's initial shareholding of tenmillion shares will represent approximately 30% of the issued capital of SilverSwan. The transaction is subject to a due diligence process and the receipt ofapproval from the shareholders of Silver Swan. Michael Elias, a non-executive director of Mercator, will assume theNon-Executive Chairman position of Silver Swan and Dr Susan Vearncombe, formerGeneral Manager-Geology of Mercator Gold plc will become the Managing Directorof Silver Swan. Managing Director of Mercator Gold, Patrick Harford, said: "The rational for the sale is the tenements, none of which are contiguous withMercator's core holdings covering the Paddy's Flat, Yaloginda, Nannine and Reedyareas, contain numerous base metals and gold prospects that require significantexploration to develop their full potential; the sale to Silver Swan will allowthat potential to be quickly realised whilst delivering significant benefits toMercator's shareholders; and Silver Swan presently has A$2.4 million availablefor exploration expenditure and is expected to aggressively develop thepotential of the tenement package." * Maps illustrating the tenements sold as well as the tenements retained can befound in the Press Release section of the Mercator website atwww.mercatorgold.com . For further information please contact: Mercator Gold plc Terry Strapp, Chairman Tel: +61 (0) 412 228 422Patrick Harford, Managing Director Tel: +44 (0) 20 7929 1010 Email: info@mercatorgold.comWebsite: www.mercatorgold.com Bankside Consultants Ltd Tel: +44 (0) 20 7367 8888 Simon RothschildKeith IronsOliver Winters AIM: MCR This information is provided by RNS The company news service from the London Stock Exchange