23 Mar 2011 07:00
PATAGONIA GOLD PLC
Trading Symbol PGD.L
23rd March 2011
AMENDMENT OF BARRICK AGREEMENT
70% BACK-IN RIGHT CONVERTED TO A 2.5% NSR
SANTA CRUZ PROVINCE, ARGENTINA
The Board of Patagonia Gold Plc (PGD) is pleased to announce that it has agreed with Barrick Exploraciones Argentina S.A. and Minera Rodeo S.A. (Barrick) to amend the original property acquisition agreement, eliminating the 'Back in Right' in exchange for a 2.5% Net Smelter Return (NSR) royalty.
In 2007, Patagonia Gold Plc (PGD) entered into an Agreement with Barrick to acquire its entire exploration property portfolio in the Santa Cruz province of Southern Argentina.
The Barrick property portfolio consisted of 70 expidentes (mineral titles) in six groups covering approximately 200,000 hectares in the highly prospective Deseado massive region of the Santa Cruz Province in Argentine Patagonia. This portfolio includes PGD's Cap-Oeste, Lomada and Manchuria gold and silver deposits.
Within the original Agreement, Barrick retained the right to purchase an aggregate interest of up to 70% in any of the six groups upon the delineation of a Canadian National Instrument 43-101 (NI 43-101) Indicated Resource of 2,000,000 ounces or greater of gold or gold equivalent, on a forward looking basis (the 'Back In Right').
In exchange for the elimination of the 'Back in Right', Barrick will receive a 2.5% NSR on all future production of mineral products on those properties pertaining to the Agreement. The amended agreement is effective immediately. The royalty will not apply to PGD's other Santa Cruz properties, or those acquired in the Fomicruz Agreement.
ENDS
For more information, please contact:
Bill Humphries/Richard Prickett Patagonia Gold Plc Tel: +44(0)20 7409 7444
Simon Raggett / Angela Peace Strand Hanson Ltd Tel: +44(0)20 7409 3494 | David Bick / Mark Longson Square 1 Consulting Tel : +44(0)20 7929 5599
Robin Henshall / Tim Graham Matrix Corporate Capital LLP Tel : +44(0)20 3206 7172 / +44(0)20 3206 7206 |