BacTech Mining Corporation

BacTech Mining Corporation

June 18, 2008 09:00 ET

BacTech Signs First Refractory Gold Project

To Acquire Yamana's 33% stake in PNG properties

TORONTO, ONTARIO--(Marketwire - June 18, 2008) - BacTech Mining Corporation ("BacTech" or the "Company") (TSX VENTURE:BM) today announced that it has reached an agreement with Yamana Gold Inc. ("Yamana") (TSX:YRI)(NYSE:AUY)(LSE:YAU) to acquire its 33% stake in two refractory gold projects in Papua New Guinea ("PNG"). The balance of the ownership in the projects (67%), is held by the current operator, Gold Aura Limited ("GOA") (ASX:GOA), of Brisbane, Australia.

Under the terms of the agreement, BacTech will issue 15 million common shares to Yamana as compensation for the purchase. Yamana will own a 19.97% equity interest (non-diluted) in BacTech post closing of the transaction. BacTech will also provide bioleach consulting on one Yamana project going forward. On closing, the existing agreement between GOA and Yamana will be cancelled to accommodate BacTech's participation going forward.

A new joint venture, between BacTech and GOA, has been created to replace
the previous arrangement between GOA and Yamana. Under the terms of the new
agreement, BacTech will pay CAD$1M directly to GOA to increase its stake in
the deposits to 43%. The initial payment of CAD$500,000 will be made on the
later of 60 days after signing the agreement and 30 days after the receipt
of all requisite regulatory approvals including the approval of the transfer
of the licenses by the Papua New Guinea government. The balance of the funds
will be due in 12 months from the transfer. The final payment will be
either 5,000,000 shares of BacTech or cash. In addition, BacTech will spend
CAD$1.5M over the next 24 months directly on the project to raise its stake
to 50%.

As part of the agreement, BacTech will retain GOA's current exploration management team to continue to explore and develop the project. GOA will charge BacTech a 12% management fee on the exploration funds to continue to operate the program. In addition, the agreement lays out certain property purchase options for BacTech should they decide to increase their stake over 50%.

The underlying assets in PNG are the Gameta and the Wapolu deposits, both located on the north shore of Fergusson Island and approximately 30 km apart. Since 1996, over $15M has been spent by GOA and Yamana on the properties. Historically, both projects have been serviced by water access due to their close proximity to the coast.

The completion of the purchase agreement with Yamana and the joint venture agreement with GOA are subject to certain conditions which include requisite regulatory consents from mining authorities in Papua New Guinea, and the receipt by BacTech of the approval of the TSX Venture Exchange to the transaction and the issuance of the common shares to Yamana and to GOA.

The Properties

Gameta: At this time, GOA is conducting an infill drill program to define a JORC resource. One of the highlights of the current program has been the discovery of much thicker mineralization at depth. To date, the JV has drilled 192 RC holes, 273 air-core holes and 32 diamond drill holes.

Wapolu: Located approximately 30 kms from Gameta. As the feasibility study begins at Gameta, Wapolu will be drilled more aggressively to outline a JORC compliant resource. To date, the joint venture has drilled 227 RC holes, 272 air-core drill holes and 97 diamond drill holes.

The transaction provides BacTech with its first project under its refractory gold acquisition program. Ross Orr, President and CEO said, "We have been able to acquire equity in a couple of assets after a long search. One of the major benefits of this deal is the retention of the GOA personnel to carry out future exploration and development. I am confident that there will be several more acquisitions in the coming months which will allow us to build an inventory of refractory gold where we can employ our commercially proven bioleaching technology. Our goal this year is to ultimately build an inventory of in excess of 1 million ounces of gold through earn-in or by acquisition."

Technical and scientific data in this news release has been verified by Dr. Paul Miller, the Company's Vice President of Technology and Engineering. Dr. Miller is a chartered engineer and a member of the Institute for Mining and Metallurgy, London, England, and is a qualified person for the purposes of National Instrument 43-101. Dr. Miller has reviewed and approved the contents of this news release.

About PNG

Papua New Guinea is a collection of islands that sit northeast of Queensland, Australia, and is the host to many well known gold mines such as Porgera (20M oz), Lihir (45M oz), Ok Tedi (17M oz) and Bougainville (16M oz). Due to the number of world class large deposits in PNG, the government of PNG is now strongly championing the development of smaller mines.


BacTech has developed and patented bacterial oxidation technology for the treatment of refractory ores and concentrates to enhance the recovery of gold, silver and base metals. BacTech has successfully commissioned three bioleach plants for gold and demonstrated its technology in the selective recovery of base metals from complex sulphide concentrates in a joint project with Industrias Penoles de C.V. of Mexico that was completed in 2001. The Company's focus is the acquisition of equity positions in projects amenable to bioleaching.


Except for statements of historical fact relating to the Company, certain information contained herein constitutes "forward-looking statements". Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other ecological data, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future and other factors described in the section entitled "Risks" in the Company's Management Discussion and Analysis for the Year Ended December 31, 2007. Circumstances or management's estimates or opinions could change. The reader is cautioned not to place undue reliance on forward-looking statements.

Shares outstanding 60,107,206

The TSX Venture Exchange has not reviewed and does not accept any responsibility for the adequacy or accuracy of this release.

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