DENVER, Dec. 11, 2013 /CNW/
- Vista Gold Corp. (TSX & NYSE MKT: VGZ) ("Vista" or the
"Company") today announced that it has signed a binding share
purchase agreement (the "Purchase Agreement") to convert its
interest in the Awak Mas gold project in Sulawesi, Indonesia
(the "Awak Mas Project") into a net smelter return royalty
("Royalty") on the project.
The Awak Mas Project is indirectly held through a wholly owned
subsidiary of the Company, Vista Gold (Barbados)
Corp. ("Vista Barbados") and is the subject of a 2009 joint venture
agreement, as amended and assigned, and a 2011 additional option
agreement, as amended and assigned, (together, the "Existing
Agreements") each between Vista Barbados and Awak Mas Holdings Pty
Ltd. (the "Purchaser") (a wholly owned subsidiary of One Asia
Resources Corp. ("One Asia")). The Existing Agreements provide the
Purchaser with the option to acquire an 80% interest in the Awak
Mas Project by completing certain activities. Additional
information about the Existing Agreements is available in the
Company's annual report on Form 10-K for the year ended
December 31,
2012.
The Purchase Agreement announced today provides for the
termination of the Existing Agreements and the acquisition by the
Purchaser of 100% of the outstanding shares of Vista Barbados, the
entity that indirectly holds the Awak Mas Project. In exchange, (a)
the Purchaser will forego certain cash payments due to have been
paid by the Company had the Purchaser completed the earn-in of its
interest in the project, and (b) the Company will receive the
Royalty (2% on the first 1.25 million ounces of gold production and
2.5% on the next 1.25 million ounces of gold production from the
Awak Mas Project).
The completion of the transaction is subject to a number of
conditions, including receipt of any required regulatory approvals,
and the transaction is expected to close on or about December 16,
2013.
Frederick H.
Earnest, President and Chief Executive Officer, said
"We are pleased that One Asia has demonstrated an ability to
advance the Awak Mas Project, and to operate effectively in
Indonesia. With One Asia poised to
perfect their 80% earn-in at the Awak Mas Project, Vista would have
been required to reimburse One Asia for certain expenses incurred
over the course of the last four years and begin to fund 20% of the
ongoing project expenditures. As a result of this new agreement
with the Purchaser, and subject to the successful development of
the Awak Mas Project, Vista could enjoy cash income with exposure
to gold prices and project reserve growth, if any, without
committing any future capital. This is consistent with our
strategic objectives, which include reducing our operating risk,
improving our balance sheet and locking in value for our
shareholders."
About Vista Gold Corp.
Vista's principal assets include its flagship Mt. Todd gold project
in Northern Territory, Australia, and a 24.9% holding in Midas
Gold Corp. In addition to non-core projects in Mexico,
Indonesia and California,
Vista holds a royalty interest in a project in Bolivia. For more information about our
projects, including technical studies and resource estimates,
please visit our website at www.vistagold.com.
Forward Looking Statements
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 completion of the transaction
announced in this press release, the anticipated closing date for
the transaction, future obligations of Vista under the Existing
Agreements, the successful development of the Awak Mas Project, the
receipt of any payments pursuant to the Royalty, the potential for
Vista to gain exposure to gold prices and project reserve growth at
the Awak Mas Project, Vista's ability to successfully reduce its
operating risk while preserving value for its shareholders and
other such matters are forward-looking statements and
forward-looking information. The material factors and assumptions
used to develop the forward-looking statements and forward-looking
information contained in this press release include the following:
approved business plans, anticipated and estimated costs and budget
expenditures to continue to optimize and advance the Company's core
assets, the perceived extent and duration of the current weakness
of gold equity securities and other such matters. When used in this
press release, the words "optimistic," "potential," "indicate,"
"expect," "intend," "hopes," "believe," "may," "will," "if,"
"anticipate," "would," "could," 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,
uncertainty of resource estimates, estimates of results based on
such resource estimates; risks relating to completing metallurgical
testing; risks relating to cost increases for capital and operating
costs; risks related to the timing and the ability to obtain
approval of the environmental impact statement and the necessary
permits for the Mt. Todd gold project, 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 Annual Report Form 10-K as filed on March 14, 2013 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, or visit the Company's website at
www.vistagold.com.
SOURCE Vista Gold Corp.