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Simberi Gold Corporation Press Release
November 16, 2004
Toronto – November 16, 2004 – Simberi Gold Corporation (TSX-V: SAU) – Simberi Gold Corporation (“Simberi”) has entered into a heads of agreement dated November 15, 2004 (the “Agreement”) with Allied Gold Limited (“Allied”) to sell its interests in the Tabar Islands Gold Project in the New Ireland Archipelago of eastern Papua New Guinea.
Satisfaction of the commercial terms of the Agreement and receipt of all necessary and regulatory and other approvals will result in Simberi holding a 12.5% carried interest in the Simberi Mining Joint Venture (ML 136) on Simberi Island and no interest in EL 609 which covers the remainder of the Tabar Island Group outside of ML 136 on central and eastern Simberi Island. The key commercial terms of the Agreement are:
Allied will purchase 37.5% of Simberi’s current 50% interest in the Simberi Mining Joint Venture and Simberi’s 1% interest in the Tabar Exploration Joint venture (EL 609) for a total cash consideration of C$4.0 million.
Completion of the transaction, including execution of a definitive agreement, will occur within 90 days of signing the Agreement with a refundable deposit of C$250,000 (inclusive) to be paid within 14 days of signing the Agreement.
Simberi will retain a 12.5% free carried interest (“FCI”) in the Simberi Mining Joint Venture through to the earlier of a decision to mine and December 31, 2009, at which point Simberi has the option to fund its pro rata share of the project or convert the FCI into Allied shares at a minimum price of A$0.50 per share. The value of the conversion will be based upon NPV derived from the bankable feasibility study at the time of making the decision to mine.
Allied will transfer the 14% interest (held by Nord Pacific Limited) in the Young Shannon project in Canada to Simberi. The consolidation of ownership over the Tabar Islands Project is viewed as a major step forward towards the development of the oxide gold deposits located on Simberi Island.
The Agreement is subject to approvals by the boards of directors of Simberi and Allied and shareholders of Simberi. To find out more about Simberi Gold Corporation (TSX-V: SAU), please contact Jim Voisin at (519) 699-5352 or visit our website at www.simberigold.com.
This press release includes certain “Forward-Looking Statements” within the meaning of the US Private Securities Reform Act of 1995. Other than statements of historical fact, all statements are “Forward-Looking Statements” that involve such various known and unknown risks, uncertainties and other factors. There can be no assurance that such statements will prove accurate. Results and future events could differ materially from those anticipated in such statements. Readers of this press release are cautioned not to place undue reliance on these “Forward-Looking Statements”. All dollar amounts are Canadian dollars unless otherwise noted.
The TSX Venture Exchange Inc. has neither approved nor disapproved the information herein contained.
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