Colombia Goldfields’ purchase of Zona Baja in offical review processadmin
Friday, August 1st 2008
Colombia Goldfields Ltd. announced today that it has received a request for additional information from a Colombian government ministry related to its proposed acquisition of the Lower Zone (Zona Baja) at the Marmato Mountain gold development project in Colombia.
The Superintendent of Industry and Commerce (the “Superintendent”) for the Ministry of Commerce, Industry and Tourism is required to review the transaction between Colombia Goldfields and the current owner of Zona Baja, Mineros Nacionales S.A. (“Mineros”), because the contemplated combined entity has revenue and/or assets with a value in excess of US $13 million.
On January 29, 2008, Colombia Goldfields Ltd. entered into a purchase and sale agreement to acquire 100% of the issued and outstanding shares of Mineros. The Zona Baja currently has a working underground operation with a mill that, based on information provided to the Company, produces approximately 25,000 ounces of gold per year. The Company previously provided a deposit guarantee in the amount of US $2.5 million and an advance of US $7.0 million against the purchase price of US $35 million.
As part of the approval process, Colombia Goldfields filed its request for review of the transaction with the Superintendent on June 6, 2008. On July 16, 2008 the Ministry asked for additional background information. Colombia Goldfields and Mineros continue to work together to complete the transaction.
Colombia Goldfields does not have an estimate of the time required by the Superintendent for review, but believes that the process is routine and expects it will be completed in due course. The Company will continue its 60,000-meter exploration program on Zona Alta (Upper Zone) of Marmato Mountain while it awaits the outcome. An initial 43-101 compliant inferred resource of 2.6 million ounces of gold, based on the first 12,186 meters of the program, was announced on May 12, 2008. The Company expects to release an updated resource figure in August 2008.
Dr Stewart D. Redwood, Vice President of Exploration of the Company, is the qualified person as defined by NI 43-101 and has prepared or supervised the preparation of all scientific and technical information contained in this press release. He is a Fellow of the Institute of Materials, Minerals and Mining (FIMMM) of the UK, a foreign professional association and designation recognized by the Canadian regulatory authorities. The laboratories used were Inspectorate (ISO 9001:2000 and 9002:2004 certified) in Medellin, Colombia (sample preparation), Reno, Nevada (preparation and analysis), and Lima, Peru (analysis), and SGS in Medellin (preparation) and Lima (analysis). Gold was assayed by fire assay with gravimetric finish or AAS finish. Silver was assayed by fire assay with AAS finish or analyzed by ICP together with a suite of multi-elements. Blank, standard and duplicate samples are routinely inserted for quality assurance and quality control.
About Colombia Goldfields
Colombia Goldfields Ltd., through our subsidiaries Compania Minera de Caldas S.A. and Gavilan Minerals S.A., is developing what we believe is a multi-million ounce gold resource in Colombia’s historic Marmato Mountain gold district.
Colombia Goldfields is traded in the US under the symbol CGDF, on the Toronto Stock Exchange under the symbol GOL, and in Germany under the symbol C2B. Further information about the Company is available at www.colombiagoldfields.com, EDGAR at www.sec.gov and SEDAR at www.sedar.com under the Company’s profile.