DENVER, Feb. 7, 2012 /PRNewswire/ -- Vista Gold
Corp. (TSX & NYSE Amex Equities: VGZ) ("Vista" or the
"Corporation") is pleased to announce that it has entered
into an Earn-in Right Agreement (the "Agreement") with
Mexico-based Invecture Group, S.A.
de C.V. ("Invecture") with respect to Vista's Concordia gold project in Baja California Sur, Mexico. Invecture
is the owner of Frontera Copper Corporation, which owns and
operates the Piedras Verdes Copper Mine in the Mexican State of
Sonora. A conference call with management to discuss this
transaction is scheduled for Monday,
February 13, 2012 at 11:00 a.m.
MST.
Vista holds the Concordia gold
project through its wholly-owned, Mexican subsidiary, Desarrollos
Zapal, S.A. de C.V. ("DZ Mexico"). Under the terms of
the Agreement, Invecture has agreed to make a non-refundable
payment of US$2.0 million in exchange
for the right to earn a 60% interest (subject to adjustment) in DZ
Mexico (the "Earn-in Right"). The Earn-in Right will
expire if not exercised by February 7,
2014, subject to extension in certain circumstances (the
"Earn-in Period"). The Agreement provides that during
the Earn-in Period, Invecture will, at its sole expense, manage and
operate the Concordia gold project
and will undertake all commercially reasonable efforts to obtain
the Change of Forest Land Use Permit ("CUSF") and the
Authorization of Environmental Impact which are required to develop
the project. Invecture has advised that it will secure
US$70.0 million in project debt
finance to construct the Concordia
gold project after it has exercised the Earn-in Right and after a
project development decision has been made. Once Invecture has
earned its interest in the Concordia gold project, the parties have
agreed to evaluate market conditions with regard to the future
organization and ownership structure of DZ Mexico.
Commenting on this transaction with Invecture, Fred Earnest, President and CEO of Vista, said,
"Our team in Mexico has worked
hard to advance the Concordia gold
project. This investment by Invecture represents a vote
of confidence that the Concordia
gold project represents an excellent opportunity to develop a new
mine that we expect will make an important contribution to
employment and to the economy in Baja California. We
and Invecture believe that the environmental impacts of the
development of a mine can be limited and that the benefits to the
state and local communities will far outweigh these concerns.
We believe Invecture's in-country experience, financial
strength, and committed management team make Invecture an excellent
strategic partner to take the lead in securing the authorizations
and financing required to bring Concordia into production."
The Agreement provides that the exercise of the Earn-in Right by
Invecture is conditional upon, among other things: (i) receipt of
the CUSF and the Authorization of Environmental Impact; (ii) the
completion of a feasibility report on the Concordia gold project which updates the
existing feasibility report with respect to costs; (iii) Invecture
funding the Concordia gold project
during the Earn-in Period; and (iv) Invecture making an additional
payment of US$20.0 million to DZ
Mexico, which amount will be used to repay intercompany loans owed
by DZ Mexico to Vista.
During the Earn-in Period and subject to the terms of the
Agreement, Vista will hold 40% of the DZ Mexico shareholder voting
rights. The remaining 60% of the DZ Mexico shareholder voting
rights will be held in a trust that will be instructed by
representatives from Vista and Invecture. Upon Invecture's
exercise of the Earn-in Right, Vista will continue to hold a 40%
interest (subject to adjustment) in DZ Mexico and the Concordia gold project.
As part of the Agreement, DZ Mexico has transferred all of its
other material assets, including the mill equipment acquired by
Vista for the Concordia gold
project in 2008 and the Guadalupe de los Reyes gold/silver project,
to other entities in the Vista group of companies. Vista has
granted Invecture the option to cause DZ Mexico to acquire the mill
equipment for US$16.0 million plus
storage, insurance and transportation costs and any applicable
taxes. This option is exercisable by Invecture during the
first 12 months after the date of the Agreement.
Mr. Earnest went on to conclude, "With Concordia being funded
and managed by a very capable Mexican partner, we are able to fully
focus our energy and resources on the development of the Mt. Todd
gold project in Northern Territory, Australia, and on the exploration and
evaluation of the Guadalupe de los Reyes gold/silver project in
Sinaloa, Mexico. We have
drilling programs underway at both of these projects, and in the
coming weeks, we expect to announce the results of a definitive
feasibility study for the Mt. Todd gold project, which will be a
significant milestone in our development of that world class
project."
About Vista Gold Corp.
Vista is focused on the development of its Mt. Todd gold project
in Northern Territory, Australia,
and its Concordia gold project in
Baja California Sur, Mexico, to
achieve its goal of becoming a gold producer. After the initial
public offering of the common shares of Midas Gold Corp.
("Midas"), Vista held approximately 30% of Midas' common
shares. Midas has a large exploration property in Idaho, including the Yellow Pine property previously held by Vista.
Vista's other holdings include the Guadalupe de los Reyes
gold-silver project in Mexico, the
Awak Mas gold project in Indonesia
and the Long Valley gold project in California. For more information about our
projects, including technical studies and resource estimates,
please visit Vista's website at www.vistagold.com.
About Invecture Group, S.A de C.V.
Invecture Group holds approximately $500
million in assets, is owned by Mexican investors and owns
Frontera Copper Corporation whose principal asset is the
Piedras Verdes copper mine in the
State of Sonora, Mexico. It
acquired Frontera in 2009 and has
executed a significant turnaround in operational, financial and
community relationship terms. This included restarting the
Piedras Verdes mine, raising
US$140 million to acquire mining
equipment, build a crushing, screening and stacking circuit and a
major upgrade to the management team.
Management Conference Call
A conference call with management to discuss this transaction is
scheduled for Monday, February 13,
2012 at 11:00 a.m. MST.
Toll-free in North America: 1-866-443-4188
International: 1-416-849-6196
This call will also be web-cast and can be accessed at the
following web location:
http://www.snwebcastcenter.com/event/?event_id=2580
This call will be archived and available at www.vistagold.com
after February 13, 2012. Audio
replay will be available for three weeks by calling in North
America: 1-866-245-6755, passcode 827120.
If you are unable to access the audio or phone-in on the day of
the conference call, please feel free to email questions to
Connie Martinez, Manager - Investor
Relations, (email: connie@vistagold.com), and we will try to
address these questions prior to or during the conference call.
This press release contains forward-looking statements within
the meaning of the U.S. Securities Act of 1933, as amended, and
U.S. Securities Exchange Act of 1934, as amended, and
forward-looking information within the meaning of Canadian
securities laws. All statements, other than statements of
historical facts, included in this press release that address
activities, events or developments that Vista expects or
anticipates will or may occur in the future, including such things
as, the timing of the expiry of the Earn-in Period, the exercise of
the Earn-in Right by Invecture, Vista's continued interest in DZA
Mexico after the exercise of the Earn-in Right, the receipt of the
required mining authorizations in respect of the Concordia gold project, the completion of an
updated feasibility report on the Concordia gold project, the payment by
Invecture of costs associated with the Concordia gold project, the payment by
Invecture of US$20 million to DZA
Mexico to exercise the Earn-in Right and the subsequent repayment
of intercompany loans, the anticipated benefits of the Earn-in
Right Agreement, the ability of Invecture to assist with the
advancement of the Concordia gold
project, including acceleration of efforts and receipt of
authorizations required for the Concordia gold project, the evaluation of
strategic alternatives for the Concordia gold project, development of a mine
at the Concordia gold project and
the resulting contribution to employment and the economy in
Baja California, environmental
impact of development on the mine, benefit to local and state
communities as a result of development of a mine at the
Concordia gold project, timing for
and announcement of the definitive feasibility study for the Mt.
Todd gold project and other such matters are forward-looking
statements and forward-looking information. When used in this
press release, the words "optimistic," "potential," "indicate,"
"expect," "intend," "hopes," "believe," "may," "will," "could,"
"if," "anticipate," and similar expressions are intended to
identify forward-looking statements and forward-looking
information. These statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Vista to be materially
different from any future results, performance or achievements
expressed or implied by such statements. Such factors
include, among others, risks associated with reliance on Invecture,
risks related to timing, completion and results of feasibility
studies, uncertainty of resource estimates, estimates of results
based on such resource estimates; risks relating to cost increases
for capital and operating costs; risks related to the ability to
obtain the necessary permits, risks of shortages and fluctuating
costs of equipment or supplies; risks relating to fluctuations in
the price of gold; the inherently hazardous nature of
mining-related activities; potential effects on Vista's operations
of environmental regulations in the countries in which it operates;
risks due to legal proceedings; risks relating to political and
economic instability in certain countries in which it operates; as
well as those factors discussed under the headings "Note Regarding
Forward-Looking Statements" and "Risk Factors" in Vista's latest
Annual Report on Form 10-K as filed on March
14, 2011, and Quarterly Report on Form 10-Q, as filed
November 9, 2011, and other documents
filed with the U.S. Securities and Exchange Commission and Canadian
securities regulatory authorities. Although Vista has
attempted to identify important factors that could cause actual
results to differ materially from those described in
forward-looking statements and forward-looking information, there
may be other factors that cause results not to be as anticipated,
estimated or intended. Except as required by law, Vista
assumes no obligation to publicly update any forward-looking
statements or forward-looking information; whether as a result of
new information, future events or otherwise.
For further information, please contact Connie Martinez at (720) 981-1185.
SOURCE Vista Gold Corp.