Agincourt to raise A$150 million for Martabe gold project

Australian mining firm Agincourt Resources Limited plans equity capital raising of A$150 million or about US$122 million to fund the acquisition price, completion of the bankable feasibility study and environmental approvals for Martabe gold project in North Sumatra.

Agincourt is set to acquire a 100 percent interest in Martabe for US$80.25 million from Newmont Corporation, representing a gold equivalent resource price of less than A$18 per ounce.

Martabe?s Purnama and Baskara prospects are believed to contain 5.3 million ounces of gold and 54.8 million ounces of silver. Agincourt estimates resources could be increased by at least 1 million ounces.

?Development of Martabe will become the primary focus for the company over the next 24 months,? Agincourt said in a statement on Monday.

According to the statement, a Joint Venture (JV) has also been formed with an Indonesian consortium led by the Dharmawangsa Group (JV Partners). The JV Partners have an option to acquire up to 30% of Martabe through a pro-rata contribution of the acquisition and development costs.

Under the JV, Agincourt will retain a minimum of 67 percent interest in Martabe. The JV will own Martabe, which will be operated on behalf of the JV by Agincourt.

?Agincourt and the JV Partners have also agreed that local government interests in Sumatra, Indonesia will be offered a 5% ?contribute or dilute? interest in Martabe,? Agincourt said.

According to Agincourt?s presentation material, the bankable feasibility study is expected to complete in March 2007, while construction phase is scheduled to start in August 2007 with commissioning phase in Dec 2008. (Robert)