WINNIPEG, MANITOBA--(Marketwired - Sep 26, 2013) - San Gold
Corporation (TSX:SGR)(OTCQX:SGRCF) today announced that it has
entered into a purchase and sale agreement (the "Purchase
Agreement") with Cougar Minerals Corp. ("Cougar") providing for the
purchase by San Gold of a 100% interest in 18 mineral claims (the
"Mineral Claims") representing approximately 2,885 hectares of land
in the Rice Lake gold belt. The Mineral Claims are contiguous to
San Gold's current mineral lease in the Rice Lake gold belt. San
Gold will pay Cougar a total consideration of 400,000 shares of San
Gold and $125,000.
San Gold and Cougar are parties to an option agreement dated
June 14, 2011 (the "Option Agreement") pursuant to which San Gold
holds an option to acquire 80% of the Mineral Claims in
consideration for certain exploration expenditures on the Mineral
Claims and the purchase of certain securities of Cougar. The
Purchase Agreement will replace the Option Agreement and upon
closing of the acquisition of the Mineral Claims by San Gold, the
Option Agreement will be of no further force or effect.
Pursuant to the Option Agreement, San Gold would have been
required to spend an aggregate of $1.5 million in exploration
expenditures over a four year period to earn its 80% interest in
the Mineral Claims as well as purchase $600,000 of securities of
Cougar. Pursuant to the Purchase Agreement, San Gold will acquire a
100% interest in the Mineral Claims, thereby retaining the value of
all previous work commitments, while significantly reducing future
work commitments for the next two years and conserving cash.
"The acquisition of the Mineral Claims is consistent with San
Gold's stated objective of consolidating prospective land in the
Rice Lake gold belt while reducing overall exploration spending
commitments," said Ian Berzins, San Gold's President, CEO and Chief
Operating Officer.
The sale of the properties is subject to certain closing
conditions including all requisite regulatory approvals, including
the approval of the TSX Venture Exchange in the case of Cougar and
the Toronto Stock Exchange in the case of San Gold. It is
anticipated that the closing of the sale of the Mineral Claims will
take place within the next two weeks.
About San Gold
San Gold is an established Canadian gold producer, explorer, and
developer that owns and operates the Rice Lake Mining Complex near
Bissett, Manitoba. San Gold employs more than 420 people and is
committed to the highest standards of safety and environmental
stewardship. San Gold is listed on the Toronto Stock Exchange under
the symbol "SGR" and on the OTCQX under the symbol "SGRCF".
For further information on San Gold, please visit
www.sangold.ca.
Cautionary Note
No stock exchange, securities commission or other regulatory
authority has approved or disapproved the information contained
herein. This news release may include certain "forward-looking
statements". All statements, other than statements of historical
fact included in this release, including, without limitation,
statements regarding forecast gold production, gold grades,
recoveries, cash operating costs, potential mineralization, mineral
resources, mineral reserves, exploration results, and future plans
and objectives of San Gold, are forward-looking statements that
involve various risks and uncertainties. These forward-looking
statements may include, but are not limited to, statements with
respect to mining and processing of mined ore, achieving projected
recovery rates, anticipated production rates and mine life,
operating efficiencies, costs and expenditures, changes in mineral
resources and conversion of mineral resources to proven and
probable mineral reserves, and other information that is based on
forecasts of future operational or financial results, estimates of
amounts not yet determinable and assumptions of
management.