TSG.L Regulatory News (TSG)

9 Jun 2006 13:02

Trans-Siberian Gold PLC09 June 2006 Trans-Siberian Gold plc TSG signs Project Finance term sheet and receives loan from AngloGold Ashanti LONDON: 9 June 2006 - Trans-Siberian Gold plc ("TSG" or "the Company") (TSG.L)is pleased to announce that, further to its 30 May announcement of the Asachalicence extension, it has signed a term sheet for the project financing of theAsacha gold mine in Kamchatka, Far East Russia. Additionally a US$10 millionloan from AngloGold Ashanti Ltd (AGA) has been arranged pending the finalisationof further equity or near equity financing. A term sheet for project finance of up to US$50 million has been signed withStandard Bank Plc and the detailed loan documentation is now being prepared. Afinal decision on raising further funds from the equity or near equity markethas not yet been made and consequently AGA will make available a loan of US$10million on commercial terms in order to prevent further delays in the project.The loan will be convertible into TSG shares when the Company raises new equity. The extension of the licence conditions together with the financing availablewill allow the project to proceed according to plan. The total project cost hasincreased from US$90 million to US$100 million inclusive of US$12 millionrefundable VAT and a contingency of US$6.3 million. Of the total project costUS$26 million has been spent to date. The increase takes account of higherRussian inflation, the strengthening rouble and modifications to the plantdesign in order to increase capacity by 10% to 220,000 tonnes per annum.Expected production from the mine is 617,000 ounces of gold and 970,000 ouncesof silver over 7 years. The Company however believes that there is potential toincrease this level of gold production by 50% from a northern extension to theexisting orebody and from two other orebodies in the proximity. A focusedexploration programme to prove up these areas is planned. Work at the Veduga exploration property in Krasnoyarsk Krai is ongoing andvarious options for the economic extraction of the ore are being evaluated. Contacts: Jonathan Best (Managing Director, TSG) +27 82 5598018 Stuart Lane (Seymour Pierce) +44 (0) 20 7107 8000 Keith Irons (Bankside) +44 (0) 20 7367 8873Oliver Winters (Bankside) +44 (0) 20 7367 8874 This information is provided by RNS The company news service from the London Stock Exchange