SolGold Regulatory News (SOLG)

12 Dec 2007 13:25

Solomon Gold PLC12 December 2007 12th December, 2007 Announcement to London Stock Exchange Solomon Gold plc SOLOMON GOLD PLACMENT OF 17.5M SHARES AT £0.18 TO RAISE £3,150,000 The Directors of Solomon Gold Plc advise that the Company has signed commitmentsfor a placement of 17.5 million shares at 18p per share for gross proceeds of£3,150,000 Pounds. The shares are to be issued on 18 December 2007. The fundsraised are to be applied to Solomon Gold's exploration program on Guadalcanal inSolomon Islands. The Company intends to continue its exploration program, focusing on theSutakiki Gold Project 30km south-east of the capital Honiara. Recently theCompany reported a high grade gold intersection of 32m at 9.45g/t at 185 metresdepth in drill hole SK011. Solomon Gold is operating three drilling rigs in theSutakiki and Koloula valleys in the search for a world class gold or copper goldore body. In addition to the drilling progam the company intends to conduct an air borneelectro-magnetic survey over 155 km2 of prospective target areas within theCompany's tenements over the Koloula and Sutakiki valleys. The survey isdesigned to detect mineralised structures. The results of this survey, togetherwith ongoing mapping and sampling programs and reinterpretation of aero magneticdata collected by the Company in 1997, are expected to define a number of highgrade drill targets. The airborne survey is expected to commence in February,2008. About Solomon Gold plc Solomon Gold holds five granted tenements on the main Island of Guadalcanal,Solomon Islands, for minerals exploration focusing on copper and gold richporphyry systems and high grade epithermal gold mineralisation. The tenementscover 468 km2 and are current, including rights to renewal periods, until 10November 2011. The company listed on AIM (London Stock Exchange) on 10 February2006 after a £5m capital raising. The Company has expended those funds inaccordance with the proposed work program and budget and has now established thenecessary infrastructure and field support facilities and gathered sufficientdata from surface mapping, sampling and subsurface drilling programs to enable afurther program of exploration drilling to enable, with added efficiency, theexploration for world class gold and copper orebodies. The Company believes the area has the potential for the discovery of a worldclass copper gold porphyry system similar to other large gold equivalentorebodies in the region such as Ok Tedi (50m oz Au Eq), Grasberg (100m oz AuEq), Lihir (40m oz Au) and Bougainville (50m oz Au Eq). These orebodies arelocated on the circum- Pacific zone of volcanoes and associated mineralisationand Solomon Gold management have identified geological features which point to astrong possibility of similar discoveries being made on the Solomon Goldtenements. Solomon Gold has identified approximately 30 km2 of mineralisation indicative ofsignificant porphyry copper gold and epithermal gold mineralisation systems andis currently engaged in a three rig program, drilling key targets. Recently thedrilling program returned a spectacular intersection of 32 metres at a grade of9.45 grams per tonne from 108m depth gold at the Sutakiki prospect,demonstrating the potential for discovery of a high grade gold resource. Thehigh grade gold mineralisation encountered in the recent drilling ischaracteristic of high grade gold deposits related to mineralised transformstructures in Papua New Guinea such as Porgera and in the Indonesian archipelagosuch as Halmahera. Solomon Gold is staffed by an active team of expatriate and Solomon Islandgeologists and field hands, supported by integrated logistics support servicesincluding a helicopter contract. Solomon Gold's key prospects are the Sutakiki, Mbina and Chikora gold and copperprospects which all align on a key transform structure through Guadalcanal, andthe Mbetilonga Copper gold project, just 15 km south of Honiara, the nationalcapital. The program is augmented by the services of two drilling contractors operating atotal of three rigs. The past year has seen Solomon Gold focus its exploration efforts primarily onthe Sutakiki prospect in the Sutakiki Valley on the northern side of Guadalcanaland the Mbina and Chikora prospects in the Koloula Valley on the southern sideof Guadalcanal. During the year the Company perfected access into the KumaValley to the east of the Koloula Valley and conducted stream sediment andmapping and sampling programs over areas of extensive mineralisation. No workwas conducted on the Mbetilonga prospect area and the Poleo application to thewest of Koloula was relinquished. In addition the Company applied for several new tenement areas. One of thesehas been granted. The Fauro Island area was applied for over an extinct volcanic caldera which hasyielded significant surface and drilling results for gold in the past, inprograms conducted by other explorers. Solomon Gold's relationships with locallandowners are expected to deliver access to the area in the near future. Faurois located in the Western Provinces immediately south of the Papua New Guineaborder and the giant Bougainville copper gold porphyry. The Fauro project haspotential for both epithermal gold and porphyry style copper gold deposits. Three exploration licence areas prospective for Nickel laterites on eastGuadalcanal, and Makira and Ngella in the Floridas island group were appliedfor. It is the current intention of Solomon Gold to define a world class gold orporphyry copper gold deposit and ultimately bring it to production. Solomon Goldhas access to the required exploration development and financing skills toachieve this goal. Director Interests Each director (either directly or indirectly) is participating in the shareplacement on the same terms of all other participants. Whilst the issue ofshares to the Directors in the placement is below the threshold to be considereda "related party" transaction pursuant to the AIM Rules for Companies (Rule 13),the Board has consulted with the Company's nominated adviser, RFC CorporateFinance Ltd, who has advised that the terms of the Directors participation inthe Placing are fair and reasonable insofar as its shareholders are concerned.The table below sets out each director's interests on Ordinary Shares of theCompany before and after the share placement (shares to be issued 18 December2007). Director Current shareholding % total Placement Shareholding % total following placementNicholas Mather 565,159 2.1% 2,340,521* 2,905,680 6.6%Cameron Wenck 212,045 0.8% 120,000 332,045 0.8%Brian Moller 92,535 0.3% 117,983 210,518 0.5%Robert Weinberg 27,000 0.1% 55,556 82,556 0.2%Total Company 26,825,001 17,500,000 44,325,001 *Note: All 2,340,521 placement shares are held in Samuel Holdings Pty Ltd < ATFThe Samuel Discretionary Trust >, which has become a significant shareholderfollowing the placement (holding 5/3%) Significant shareholders As a result of the Placement, the Company is aware of the following changes insignificant shareholdings: Significant shareholder Current % total Shareholding % total shareholding following placementRAB Special Situations (Master) Fund 852,103 3.2% n/a < 3%LtdCat Brokerage AG n/a < 3% 1,388,000 3.1%Williams de Broe n/a < 3% 1,700,000 3.8%Phoenix Gold Fund Ltd n/a < 3% 2,750,000 6.2% By order of the BoardDP CornishCompany Secretary Contacts: Mr Duncan CornishSecretaryTel: +61 7 3303 0680 or dcornish@solomongold.com Mr Stephen WeirRFC Corporate FinanceNominated AdvisorTel +61 2 9250 0048 or Stephen.Weir@rfc.com.au This information is provided by RNS The company news service from the London Stock Exchange