Kingsrose updates S.Sumatra gold/silver project

Australian mining firm Kingsrose Mining Limited said on Wednesday that all parties involved in the proposed acquisition of Way Linggo gold/silver project in South Sumatra have executed agreements relating to the acquisition by the company of an 85 percent interest in the project.

The transaction will take the form of an acquisition by the company from Icon Enterprises Ltd of all of the shares of MM Gold Pty Ltd. MM Gold?s wholly owned subsidiary owns 85 percent of the shares of PT Natarang Mining (PTNM), the Indonesian company which operates the project and holds the Contract of Work issued by the Indonesian Government.

Completion of the acquisition is subject to a number of conditions precedent (which must be met by Nov. 30, 2008 or such other date as may be agreed) including:

(1) approval by the Company?s shareholders;

(2) completion by the Company of due diligence to its satisfaction; and

(3) the Company receiving commitments for funding in the sum of $15 million, (which will be applied in connection with construction of the mine and repayment of loans made and expenses incurred in connection with the Project).

As part of its remaining due diligence process, the company will satisfy itself that the last Indonesian permit, notably the ?final forestry approval? has or will be obtained from the Ministry of Forestry within a reasonable timeframe, thereby enabling the company to commence production.

PTNM submitted its ?final forestry approval? application in August 2008.

Kingsrose is expected in the March 2009 quarter at a forecast annualized production rate of 30,000 ozs Au Eq. The capital requirement to complete construction is expected to be approximately A$8 million.

Way Linggo gold/silver project contract of work (CoW) covers 10,540 hectare of land. (denny)