December 05, 2006 20:14 ET

Aur Resources to Increase Its Interest in Its Andacollo Mine Property From 63% to 90%

TORONTO, ONTARIO--(CCNMatthews - Dec. 5, 2006) - Aur Resources Inc. (TSX:AUR)(SSE:AUR) announces that it has entered into an agreement with Compania Minera del Pacifico S.A. ("CMP") whereby it will have the right to purchase the Series A Shares of Compania Minera Carmen de Andacollo ("CDA") which represent 27% of the economic interest in CDA for US$103 million (the "Shares"). This transaction would increase Aur's economic interest in CDA from 63% to 90%, with Empresa Nacional de Minería ("ENAMI"), a Chilean Government company, owning the remaining 10% interest.

The Aur-CMP agreement is structured as a Put-Call transaction whereby CMP will have the right, exercisable at any time between January 1 and January 15, 2007, to require Aur to purchase the Shares from CMP for US$103 million. Aur will have the right, exercisable at any time from January 15, 2007 (or, if earlier, from the date of receipt of notice from CMP that CMP will not be exercising its put option) until January 31, 2007, to require CMP to sell the Shares to Aur for US$103 million. Closing of the transaction is expected to take place in the second half of January 2007 but in any event no later than ten business days after any exercise of the CMP put or the Aur call option.

"The purchase of an additional 27% interest in the Andacollo copper assets is an excellent way for Aur to increase its copper production at minimal risk while continuing to provide high returns on its invested capital to shareholders", said James W. Gill, Aur's President and CEO. "Aur intends to exercise its right to purchase the CDA shares in the event that CMP does not exercise its Put Option."

CDA is the owner of a 100% interest in the currently operating Andacollo Supergene Copper Mine and the large Andacollo Hypogene Copper-Gold Deposit currently under development. The Supergene Copper Mine produces approximately 40 million pounds (18,150 tonnes) of LME registered cathode copper and has reserves to continue production until late 2009 when it will be phased out and the Hypogene Copper-Gold Deposit will commence production. The Hypogene Copper-Gold Deposit will have a mine life of at least 21 years until 2031 and, on average in the first 10 years of operation, will produce 178 million pounds of copper (80,600 tonnes) and 66,000 ounces of gold annually in copper concentrates.

This news release contains forward-looking statements that are based on current expectations and which involve risks and uncertainties, including those referred to in Aur's 2005 Annual Report and/or in Aur's Annual Information Form dated March 24, 2006 ("AIF") and filed with Canadian securities regulatory authorities, that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in the forward-looking statements. Such forward-looking statements include statements regarding financial results and expectations for 2006 and include, among other things, statements regarding targets, estimates and/or assumptions in respect of copper production and/or copper prices, timing and costs of the development of new deposits, operating costs, ongoing expenditures on property, plant and equipment, levels of and increases and decreases in production, reserves and/or resources and anticipated grades and recovery rates and are or may be based on assumptions and/or estimates related to future economic, market and other conditions and include parameters, assumptions and conclusions in any feasibility studies. Factors that could cause actual results, developments or events to differ materially from those anticipated include, among others, the factors described or referred to elsewhere herein and/or in the AIF and include unanticipated and/or unusual events. Many of such factors are beyond Aur's ability to control or predict. Actual results may differ materially from those anticipated. Readers are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein. Aur disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise.

Contact Information

  • Aur Resources Inc.
    Dr. James W. Gill
    President and Chief Executive Officer
    (416) 362-2614
    (416) 367-0427 (FAX)
    Aur Resources Inc.
    Mr. Peter McCarter
    Executive Vice-President, Corporate Affairs and Secretary
    (416) 362-2614
    (416) 367-0427 (FAX)