| Thu 15 Jun 2006, 12:27 | | Anglogold Ashanti Signs Letter Of Intent With Inte |
|
ANG
ANANO
Anglogold Ashanti Signs Letter Of Intent With International Tower Hill Mines
Limited
AngloGold Ashanti Limited
Incorporated in the Republic of South Africa
Registration Number: 1944/017354/06)
ISIN Number: ZAE000043485
JSE Share Code: ANG
("AngloGold Ashanti/Company")
15 June 2006
ANGLOGOLD ASHANTI SIGNS LETTER OF INTENT WITH INTERNATIONAL TOWER HILL MINES
LIMITED
AngloGold Ashanti Ltd (JSE: ANG) is pleased to announce the signing of a Letter
of Intent with International Tower Hill Mines Ltd. (TSXV: ITH) for the sale and
option of all of AngloGold Ashanti"s Alaskan mineral exploration properties and
associated databases to ITH.
Under the terms of the agreement, AngloGold Ashanti will vend to ITH a 100%
interest in six Alaskan exploration properties (Livengood, West Pogo, Coffee
Dome, Gilles, Caribou, and Blackshell) covering a total of 246 km2. In
consideration for the sale, ITH will issue to AngloGold Ashanti 19.99% of its
issued shares following the acquisition and the completion of equity financing
to raise a minimum of US$10m for future exploration activities. ITH has
initially arranged a non-brokered private placement for the issue of up to 8
million units (comprising one common share and one-half common share warrant) at
C$0.56 per unit, for gross proceeds of C$4.48m (approximately US$4m). Cardero
Resource Corporation (TSXV: CDU) has agreed to subscribe for 4 million units in
this placement. ITH will be required to raise an additional approximately $US6m
either prior to or concurrently with the closing of the deal with AngloGold
Ashanti. AngloGold Ashanti will have the right to maintain its equity interest
in ITH so long as such interest remains above 10%.
In addition to vending to ITH a 100% interest in these six exploration
properties, AngloGold Ashanti will also grant ITH the exclusive option to
acquire a 60% interest in each of its LMS and Terra projects by incurring US$3m
of exploration expenditure on each project within four years of the grant date
of the option. Upon ITH having earned into its 60% interest in either (or both)
project(s), new Joint Ventures for each of these projects will be formed and
AngloGold Ashanti will have a period of 90 days in which to elect to increase
its stake in either (or both) project(s) to 60% and become manager of the Joint
Venture(s) by expending, at its option, an additional US$4m on each project
during the subsequent two-year period. Should AngloGold Ashanti elect not to
increase its stake in either of the projects, it will have the option to either
participate in the development of the project as a 40% contributing partner or
to dilute according to standard industry formulae. AngloGold Ashanti will also
have a 90-day right of first offer with respect to any of ITH"s properties that
it proposes to farm-out or otherwise dispose of.
Commenting on the transaction, Executive Officer: Business Development Richard
Duffy said, "The sale and option of our Alaskan mineral properties to ITH is in
line with our objective of focusing our own greenfields exploration activities
on other quality opportunities globally. Whilst Alaska remains highly
prospective for the discovery of new gold mines, our commitment in countries
such as the DRC, Colombia, and Australia limit our ability to optimally develop
these Alaskan projects. Through the envisaged cooperation with ITH, the
exploration programmes at these projects will be accelerated and, as AngloGold
Ashanti will retain a significant shareholding in ITH (in addition to JV rights
and interests in the LMS and Terra projects), our shareholders will have
excellent upside exposure to any future discoveries made in Alaska by ITH".
Closure of the transaction is subject to a number of conditions, including
satisfactory due diligence results, execution of applicable formal documentation
and regulatory acceptance on behalf of ITH.
ends
Queries:
North America Tel: E-mail:
Andrea Maxey +1 212 750 7999 amaxey@anglogoldashanti.com
+1 646 549 8992
South Africa Tel: Email:
Michael Clements +27 (0) 11 637 6647 mclements@anglogoldashanti.com
+27 82 339 3890
Disclaimer
Certain statements made during this presentation, including, without limitation,
those concerning the economic outlook for the gold mining industry, expectations
regarding gold prices, production, cash costs and other operating results,
growth prospects and outlook of AngloGold Ashanti"s operations including the
completion and commencement of commercial operations of certain of AngloGold
Ashanti"s exploration and production projects, and its liquidity and capital
resources and expenditure, contain certain forward-looking statements regarding
AngloGold Ashanti"s operations, economic performance and financial condition.
Although AngloGold Ashanti believes that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be given that such
expectations will prove to have been correct. Accordingly, results could differ
materially from those set out in the forward-looking statements as a result of,
among other factors, changes in economic and market conditions, success of
business and operating initiatives, changes in the regulatory environment and
other government actions, fluctuations in gold prices and exchange rates, and
business and operational risk management. For a discussion of such factors,
refer to AngloGold Ashanti"s annual report on Form 20-F for the year ended 31
December 2005, which was filed with the Securities and Exchange Commission (SEC)
on 17 March 2006. AngloGold Ashanti undertakes no obligation to update publicly
or release any revisions to these forward-looking statements to reflect events
or circumstances after today"s date or to reflect the occurrence of
unanticipated events.
Date: 15/06/2006 12:27:56 PM Produced by the JSE SENS Department
