NEWS RELEASE TRANSMITTED BY CCNMatthews
FOR: HIGH RIVER GOLD MINES LTD.
TSX SYMBOL: HRG
AND JILBEY GOLD EXPLORATION LTD.
TSX VENTURE SYMBOL: JLB
FEBRUARY 18, 2004 - 08:50 ET
Strategic Alliance Agreement Between High River Gold And
Jilbey Gold Results In Aggressive Exploration Plans For
TORONTO, ONTARIO--(TSX:HRG) - High River Gold Mines Ltd.("High
River") and Jilbey Gold Exploration Ltd.("Jilbey") (TSXV:JLB)
have signed a letter agreement which will significantly expand
the exploration activity on their large land position in Burkina
Faso. The agreement is subject to regulatory approval and the
approval of the board of directors of both companies.
The strategic alliance establishes Jilbey as High River's
exploration arm in Burkina Faso, on an exclusive basis, and
provides Jilbey with defined rights of access to the planned mill
at High River's Taparko Gold Project.
High River will have the right to back-in for 50% of each
property where a new economic deposit is discovered within
trucking distance of the planned Taparko production facility, a
distance of approximately 100 kilometres. On deposits found
outside the trucking distance, Jilbey may develop the project on
a 100% Jilbey basis; High River will have a 30-day right of first
refusal, if Jilbey decides it wants a partner.
In October 2003, High River announced it was commencing
development of the Taparko Gold Project in Burkina Faso (press
release dated October 31, 2003). The planned operation should
process one million tonnes of ore per year, through a
conventional mill, with gold production averaging more than
90,000 ounces per year over an eight year period, exceeding
100,000 ounces in each of the first three years.
High River is designing the operation and infrastructure with
"expansion" and an "extended mine life" in mind as the Company
believes there is excellent potential to define satellite
deposits within trucking distance of the mill. A standard joint
venture agreement will be formed to provide for development of
any significant gold deposit discovered within trucking distance
of the Taparko project, with High River the operator in the
development and production stage. The tolling charge will be
based on (a) any expansion required to the Taparko mill financed
by High River and amortized over the mine life of the new
reserve, plus (b) the cost to High River of processing ore. As a
result, Jilbey will have the potential to become an early gold
producer through an established production facility with the
expansion financed by High River.
The strategic alliance is designed to allow High River to focus
management time and funding on the development, production and/or
acquisition of defined gold deposits and Jilbey's management to
focus on aggressive gold exploration for new discoveries that can
either enhance the Taparko project by expanding the production
profile or extending the mine life, or result in new stand-alone
development projects for Jilbey in Burkina Faso.
High River has also agreed to support Jilbey's future equity
financings by subscribing for 10% to 15% of total financings and
to contract its exploration team to Jilbey at cost. This
maintains the momentum and continuity of an expert exploration
team, that has been active in Burkina Faso since 1996, for the
benefit of both companies.
As part of the strategic alliance, High River has agreed to
transfer all its existing exploration properties in Burkina Faso
to Jilbey other than High River's original property which is
covered by a Mining Investment Agreement with the Burkina Faso
government. High River will transfer four new properties,
totalling approximately 900 square kilometres, that are within
trucking distance of the planned Taparko mill. High River will
continue to assist Jilbey in acquiring additional exploration
properties but will maintain the right to acquire advanced gold
projects from third parties in Burkina Faso on its own.
High River and Jilbey currently control properties in Burkina
Faso covering in excess of 5,300 square kilometres, of which
approximately 2/3 are within trucking distance of the Taparko
mill. Two of the new properties being transferred by High River,
Birgui-Nabingou and Bougou, have already received US $370,000 of
exploration work, and have defined geochemical anomalies on
favourable structural trends along the northwestern strike
extension of the Taparko shear zone that hosts High River's
Taparko gold deposits.
These two properties provide Jilbey with drill ready targets and
a US $230,000 Rotary Air Blast ("RAB") drilling programme is
planned to commence later this month. The RAB drilling is
designed to test geochemical anomalies approximately 20
kilometres from the planned development site of the Taparko mill.
Jilbey Gold is currently operating active exploration programmes
on three separate area plays in Burkina Faso. Around the Taparko
deposit area, Jilbey has completed regional prospecting,
geophysics, geochemistry and an extensive RAB drilling program
and follow up definition drilling is planned to test several
target areas. In the Bissa deposit area, east of Cluff's Kalsaka
deposit, Jilbey is conducting a regional prospecting programme
and geochemical sampling programme along the prospective Birimian
rocks on the permits and to date several potential RAB drilling
targets have been identified. In the Hounde belt, Jilbey is
exploring its permits which cover 60 kilometres of the southern
extension of the significant gold bearing structure extending
from Orezone's Bondi discovery. Mr. Isenor, President and CEO of
Jilbey, stated "2004 will be the busiest year ever for Jilbey
Gold and we are very excited to be conducting this extensive
programme in such a prospective, underexplored country with the
assistance of our strategic partner, High River Gold".
Note: this press release has two map attachments. Please click on
the following links to view the attachments:
FOR FURTHER INFORMATION PLEASE CONTACT:
High River Gold Mines Ltd.
David Mosher, President and CEO
Don Whalen, Chairman
Jilbey Gold Exploration Ltd
Gregory P. Isenor, P. Geo., President and CEO
Dan Whittaker, VP and CFO