High River Gold Mines Ltd.

High River Gold Mines Ltd.

December 04, 2006 08:58 ET

High River Gold Initiates Strategic Review

TORONTO, ONTARIO--(CCNMatthews - Dec. 4, 2006) - High River Gold Mines Ltd. ("High River" or "the Company") (TSX:HRG) announces that the Strategic Review Committee of the Board of Directors has been directed to evaluate corporate reorganization alternatives for increasing shareholder value. The Committee will consider current market and industry conditions and assess the barriers which inhibit full recognition of High River's asset values.

High River has assembled a significant gold and silver asset base which includes two producing mines, two mines under construction and two advanced exploration projects; these assets are concentrated in two globally diverse areas, Russia and West Africa. In each area High River has established the critical asset mass and the operating expertise to act on an independent basis.

The Committee will be considering various alternatives to maximize shareholder value including corporate reorganization which could be accomplished by spin out or other means. The Committee has retained the Company's legal counsel to assist in assessing the various restructuring alternatives. In addition, High River will be retaining an investment banking firm and special advisors, where appropriate, to review any proposal put forth by the Committee with a view to confirming the best course of action.

The Committee expects to be in a position to report to the Board during the first quarter of 2007.

About High River

High River is currently constructing two open-pit gold mines which are scheduled to commence production in the first half of 2007, the Taparko-Bouroum Project in Burkina Faso and the Berezitovy Project in Russia. Annual gold production from Taparko-Bouroum is planned at 100,000 ounces in year one increasing to over 140,000 ounces in the third year of operation, with annual production from Berezitovy averaging more than 100,000 ounces. Combined with gold production from High River's 85%-owned Russian subsidiary, OJSC Buryatzoloto, High River's attributable annualized gold production rate is expected to exceed 325,000 ounces by mid-2007, establishing the Company as a mid-tier gold producer. In addition, the Company has two advanced exploration projects, the Bissa Gold Project in Burkina Faso and the world-class Prognoz Silver Project in Russia. These projects are expected to significantly add to the Company's production profile in the future.

FORWARD LOOKING STATEMENTS - This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected. Risk and uncertainties about the Company's business are more fully discussed in the Management's Discussion and Analysis published in the Company's Annual Report and in the Annual Information Form.

Contact Information

  • High River Gold Mines Ltd.
    Don Whalen
    Executive Chairman
    (416) 947-1440
    (416) 360-0010 (FAX)
    Email: info@hrg.ca
    Website: www.hrg.ca