Barkerville Gold Mines Ltd.

Barkerville Gold Mines Ltd.

November 16, 2010 10:25 ET

Barkerville Closes Acquisition of Additional Gold Mill Facility in Central British Columbia

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 16, 2010) - Barkerville Gold Mines Ltd. (TSX VENTURE:BGM)(FRANKFURT:IWUB) (the "Company") announces that it has closed the purchase of the Goldstream Mill facility, tailings pond and related mineral leases through the acquisition (the "Acquisition") of Bethlehem Resources (1996) Corporation ("BRC") under the terms previously disclosed on September 23, 2010 (News Release 10-25).

It is the Company's intention, subject to approvals, to relocate, refurbish and upgrade the Goldstream mill facility to a location in the vicinity of Cow Mountain, near Wells, BC, where two of the Company's NI 43-101 gold resources and proposed open-pit deposits are located in Central British Columbia. Upon relocation, the Company plans to upgrade the mill with an additional ball mill and a carbon-in-pulp circuit, to an increased capacity of 2,000 tonnes per day. The Company's Bonanza Ledge proposed open-pit mine on the adjacent Barkerville Mountain is currently in the BC Mines Act review process. The Cariboo Gold Project, encompassing Cow Mountain, is anticipated to re-enter the BC Environmental Assessment Process in the 4th Quarter of 2011.

The Goldstream Mill is a custom mineral processing plant located in the Revelstoke Mining Division, approximately 90 km north of Revelstoke, BC (via Hwy 23). It is a permitted facility currently on care and maintenance, with available accommodation in the adjacent tailings pond for possible future operations.

The Acquisition was completed pursuant to a share purchase agreement ("Agreement") between the Company, BRC and International Bethlehem Mining Corporation (TSXV:IBC) ("IBC") dated September 2, 2010 whereby the Company purchased all the issued and outstanding shares of BRC from IBC. Pursuant to the Agreement, the Company will pay IBC an aggregate purchase price of $3,300,000. The purchase price will be satisfied by the Company paying IBC a $50,000 deposit (paid), a $200,000 due diligence fee (paid), $250,000 on each of the 6 month and 12 month anniversaries of the Closing Date and $550,000 on the 18 month anniversary of the Closing Date. The Company will also pay $2,000,000 by the issuance of $500,000 worth of shares on each of the Closing Date (issued), the 6 month anniversary, 12 month anniversary and 18 month anniversary of the Closing Date. The number of shares to be issued to IBC will be calculated based on the volume weighted-average price of the Company's shares on the TSX Venture Exchange for the 10 trading days ending on the day prior to each of the Closing Date, 6 month anniversary, 12 month anniversary and 18 month anniversary of the Closing Date, as applicable, subject to a floor price of $0.92 per share. On November 16, 2010, the Closing Date, the Company issued 371,471 shares to IBC which are subject to a hold period expiring March 17, 2011.

About Barkerville Gold Mines Ltd.

The Company continues to develop its Cariboo Gold Project in Barkerville, B.C., which encompasses (from northwest to south east) the former producing Hardscrabble Tungsten Mine, Mosquito Creek Gold Mine (now on care and maintenance), Aurum Mine, Island Mountain Mine, Cariboo Gold Quartz Mine, Bonanza Ledge (proposed mine), the Cariboo Thompson Gold & Silver Mine and the Cariboo Hudson Mine. The Company commenced operations in the Cariboo District in 1994 and since that time has focused on the exploration and development of its gold properties. Mineral tenures in the historic Cariboo goldfields encompass approximately 1,112 square km (112,484 hectares) over a 60 km long by 20 km wide belt. In the Barkerville Gold Camp, 101 creeks have reported placer gold production. Recorded gold production from the area totals more than 3.8 million ounces, including an estimated 2.64 million ounces from placer mining and 1.23 million ounces from lode mining. The Company began gold dore production at its QR Mine in September 2010 and has not hedged any future gold production.

On behalf of the Board of Directors

J. Frank Callaghan, President and CEO

This News Release contains forward-looking statements. Forward-looking statements are statements which relate to future events and conditions and therefore involve inherent risks and uncertainties. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our industry, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results. All phases of the Company's operations are subject to environmental regulation and governmental approval and permits and there can be no assurance that the Company will obtain all the requisite permits for future development. Mining is an inherently risky business with large capital expenditures and cyclical metals markets.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Barkerville Gold Mines Ltd.
    J. Frank Callaghan
    President and CEO
    604-669-6463 or Toll Free: 1-800 663-9688
    604-669-3041 (FAX)