Birim Goldfields Inc.

Birim Goldfields Inc.

August 28, 2007 08:00 ET

Birim Concludes an Agreement with Newmont to Joint Venture the Banda Ahenkro Property on the Sefwi Belt and to Waive Back-In Rights on Birim's Bui Properties in Ghana

MONTREAL, QUEBEC--(Marketwire - Aug. 28, 2007) - Birim Goldfields Inc. (TSX:BGI) ("Birim" or "the Company") is pleased to report that it has concluded a two-part agreement with Newmont Ghana Gold Limited and Newmont USA Limited, subsidiaries of Newmont Mining Corporation (NYSE & ASX: NEM; TSX: NMC) ("Newmont") comprising:

- a joint venture agreement on the 488.3 km2 Banda Ahenkro Property on the Sefwi Belt; and,

- the waiving of Newmont's back-in rights on Birim's Bui Belt Properties.

Under the terms of the agreement, Newmont will waive their historical back-in right to projects on Birim's thirteen properties within the boundary of the old Bui Reconnaissance License. In exchange for this waiver, Birim will grant Newmont an initial 49% equity interest in Birim's Banda Ahenkro Property on the Sefwi Belt (see Note 1). Newmont will have the right to earn another 21% (up to 70%) by spending US$1,500,000 on exploration over four years, subject to minimum expenditures of US$300,000 in Year 1, US$350,000 in Year 2, US$400,000 in Year 3 and US$450,000 in Year 4. Newmont may then elect to earn an additional 10% interest (up to 80%) by completing a feasibility study on the property. The agreement remains subject to the normal statutory and regulatory approvals.

Birim has a dominant position on one of Ghana's relatively under-explored gold belts, the Bui Belt. This comprises a portfolio of fifteen licenses, of which thirteen prospecting licenses were "cherry picked" after systematic regional exploration by Birim from the greater than 7,000 km2 Bui reconnaissance license acquired from Santa Fe Mining in 1998. The terms agreed with Santa Fe at the time included a right (subsequently inherited by Newmont) allowing them a once-off back-in to any project with a completed bankable feasibility study located within the area defined by the boundary of the original reconnaissance license.

"The transaction makes a lot of strategic sense for Birim," says Victor King, President and CEO for Birim. "Exploration progress on the Banda Ahenkro property will benefit from Newmont's broad exploration expertise and their specific experience on the Sefwi Belt, which hosts their multi-million ounce, world-class Ahafo Gold Mine. Our active involvement with Newmont at Banda Ahenkro also will benefit our efforts on Birim's other three properties on the Sefwi Belt, namely Nkenkasu, Bia Tano and Techimentia." King added, "Newmont's waiver to their inherited back-in right on our Bui properties will widen our options for funding exploration on this extensive land package. I believe that it is pragmatic for Birim to invite selected interested partners to assist in aggressively advancing exploration on some of our Bui licenses at this stage. This will maximize Birim's current leverage on the belt and optimize the potential for exploration success on all of the properties."

Birim Goldfields Inc. is an exploration company focused on gold exploration in West Africa and trades on the Toronto Stock Exchange under the symbol BGI.

Notes : 1. The Government of Ghana retains a 10% free carried interest in all gold mining development projects in Ghana. Consequently, the interests specified in the agreement will apply to the 90% available interest, with the Government of Ghana holding the remaining 10%.

Contact Information

  • Birim Goldfields Inc.
    Denis Simoneau
    514-393-8611 or Toll Free: 1-800-721-8611
    Birim Goldfields Inc.
    Victor King
    President & CEO
    514-393-8611 or Toll Free: 1-800-721-8611
    Birim Goldfields Inc.
    Farah Alibhai
    Investor Relations