BDI Mining Corp.

BDI Mining Corp.

March 03, 2005 20:42 ET

BDI Mining Corp.: Woodlark Island Gold Project, Barclays Capital Appointed Project Finance Advisor, 25,000 Metre Drilling Program, GBP Pounds Sterling 4.5 Million Share Placement


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: BDI MINING CORP.

TSX VENTURE SYMBOL: BDI
AIM SYMBOL: BMG

MARCH 3, 2005 - 20:42 ET

BDI Mining Corp.: Woodlark Island Gold Project,
Barclays Capital Appointed Project Finance Advisor,
25,000 Metre Drilling Program, GBP Pounds Sterling 4.5
Million Share Placement

TORONTO, ONTARIO--(CCNMatthews - March 3, 2005) - BDI Mining Corp. (TSX
VENTURE:BDI)(AIM:BMG) announces significant developments with respect to
the Company's 100%-owned Woodlark Island Gold Project, 300 kilometres
northeast of the Papua New Guinea mainland.

Highlights

- The Company has appointed Barclays Capital, the investment banking
division of Barclays Bank PLC, as project advisor for the Woodlark
Island gold project, to work with the Company in advancing the project
and securing debt finance for any future gold mining operations.

- A 25,000 metre reverse circulation and diamond drilling program will
commence in April to target new mineralisation.

- Loeb Aron & Company has been appointed to arrange a private placing to
institutional investors of up to 15 million shares at GBP 30 pence per
share (approximately Cdn$0.71 per share), to raise gross proceeds of up
to GBP Pounds Sterling 4.5 million.

Barclays Capital

Barclays Capital, the investment banking division of Barclays Bank PLC,
has been appointed project advisor for the Woodlark Island gold project.
The terms of the engagement with Barclays Capital will be split into two
phases. Phase 1 will be to take the project through finalisation of
bankable feasibility and structuring of debt package. Phase 2 is
finalisation of project financing.

Under the terms of the engagement, the highly regarded Mining & Metals
team of Barclays Capital will work with BDI Mining to ensure that all
aspects of the Woodlark exploration program conform to Barclays
Capital's standards required for the project to be "bankable".

"We are delighted to appoint an advisor of the calibre of Barclays
Capital," said BDI Mining managing director, Mr. Lee Spencer. "The
appointment affirms management's belief that Woodlark Island has
potential to develop into a significant gold mining operation.
Exploration over the next 12 months will be accelerated so the full
resource potential of Woodlark can be identified."

"Barclays Capital is one of the world's leading investment banks with a
focus on debt and risk management. The Mining & Metals team assists a
wide variety of clients throughout the global mining industry and is
delighted to be working with BDI Mining in the development of this
exciting gold project," said Mr. Gerard Holden, Head of Mining & Metals
at Barclays Capital.

In consideration of the engagement, BDI has agreed to issue Barclays
Capital 2,500,000 warrants to purchase common shares in BDI Mining
Corporation for a period of five years from the issue date. The warrants
have a strike price of Cdn$0.60 per share. 1,250,000 warrants vest
immediately, 750,000 of the warrants vest when BDI's share price reaches
Cdn$0.84 per share (or UK sterling equivalent) for a period of five
consecutive trading days on either the TSX Venture Exchange or the AIM
Market in London, and the balance of 500,000 warrants will vest when BDI
share price reaches Cdn$1.19 (or UK sterling equivalent) for a period of
five consecutive trading days. Shares acquired on the exercise of the
warrants will be subject to a four month hold period from the date of
issuance of the warrants.

Woodlark Exploration

During 2004, BDI completed 2,800 metres of diamond drilling on Woodlark
Island, concentrating on the Kulumadau deposit, where approximately half
of the existing Woodlark measured and indicated resource of 374,916
ounces (6,779,000 tonnes at 1.72g/t Au1) was identified by a previous
operator. BDI's drilling intersected high-grade mineralisation
approximately 70 metres below the base of the previous drilling.
Preliminary 3D modeling by the Company's consultants Continental
Resource Management Pty Ltd in Australia have demonstrated continuity
between the near surface mineralisation and the deeper Kulumadau
mineralisation intersected by BDI Mining. The mineralisation remains
open at depth.

Simultaneously, BDI completed an induced polarization (IP) survey over
the whole 2.5 kilometre Kulumadau-Great Northern Trend as well as Wonai,
a high-grade epithermal gold target in the south of the island. This
survey has generated 26 new targets, six of which display the same
intensity of signature as Kulumadau.

Wonai and the six priority IP targets will be drill tested with a 25,000
metre diamond and reverse circulation drilling program commencing in
April and scheduled to be completed by the end of September. The first
to be drilled will be Wonai, where surface sampling has returned values
up to 56g/t Au with associated significant silver grades, with trenching
currently underway. Simultaneously, IP will be run over the mineralized
Vulcan-Federation Trend and the Wotau-Boniavat Trend to prioritise
additional drill targets.

Financing

To finance the accelerated drilling program, the Company has appointed
Loeb Aron & Company of London to arrange the placement to institutional
investors of up to 15 million shares at GBP 30 pence per share, to raise
gross proceeds of up to GBP Pounds Sterling 4.5 million. Loeb Aron will
be paid a fee of 6% of the gross proceeds raised payable in cash or
shares at its option. The shares will be tradeable on the AIM Market of
London, but will be restricted for trading on the TSX Venture Exchange
for a period of four months from closing.

(1) The resource calculations were completed by Snowden Associates of
Perth in September, 1996 using the JORC Code, and based on drilling
undertaken by Auridiam Ltd and assays processed by Astrolab Pty Ltd in
PNG, with check assays undertaken by Analabs in PNG. No more recent
resource estimate has been done. BDI considers the resource calculations
to be both reliable and relevant to the Woodlark Property. The JORC Code
classifications used are believed to be roughly equivalent to CIM
classifications at that time.

The financing and Barclays Capital warrants are subject to the approval
of the TSX Venture Exchange.

Issued on behalf of BDI Mining Corp.

Lee K. Spencer, President & CEO

Forward-Looking Statements: Statements in this release that are
forward-looking statements are subject to various risks and
uncertainties concerning the specific factors disclosed under the
heading "Risk Factors" and elsewhere in the corporation's periodic
filings with Canadian securities regulators.

Such information contained herein represents management's best judgment
as of the date hereof based on information currently available. The
Company does not assume the obligation to update any forward-looking
statement.

Woodlark exploration is supervised by the Company's President and CEO,
Mr. Lee K. Spencer, MSc, MAusIMM, a qualified person as defined by
National Instrument 43-101. Mr. Spencer is responsible for the
preparation of technical information in the company's News Releases.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    BDI Mining Corp.
    Chuck Forrest
    Finance Director
    (416) 955-9535
    (416) 955-9538 (FAX)
    www.bdiminingcorp.com
    or
    Ruegg & Co (AIM Nominated Advisor)
    Brett Miller
    +44-20-7584 3663
    or
    Hichens, Harrison & Co. (AIM Broker)
    Christian Dennis
    +44-20-7382 4473
    or
    Parkgreen Communications
    Justine Howarth
    + 44-20 74933713
    No stock exchange has approved or disapproved the information contained
    herein.