PNG Gold Corporation
TSX VENTURE : PGK

PNG Gold Corporation

July 26, 2011 08:57 ET

PNG Gold Corporation Provides Update on Financing and Operations

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 26, 2011) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. NEWSWIRE SERVICES

PNG Gold Corporation ("PNG Gold" or the "Company") (TSX VENTURE:PGK) is pleased to provide an update on the previously announced private placement (see news releases dated June 14, 2011 and July 13, 2011) and on operational activities at the Imwauna project, Normanby Island, Milne Bay Province, Papua New Guinea.

Financing

The Company's previously announced private placement has been well-received in the marketplace and the Company anticipates closing the financing with an over-allotment portion being exercised to bring the total gross amount raised in the financing to approximately $38 million dollars. Closing will now be on Thursday July 28, 2011. The private placement is being led by Canaccord Genuity Limited and Paradigm Capital Inc. as Agents.

Operations Update

Following closing of the private placement, the Company will look to implement and rapidly advance the business plan for the Imwauna project. Management's intention is to rapidly advance the Imwauna project to a production decision by the second quarter 2012.

The Company has begun making arrangements to increase the number of drills on site from two to five by year end. In addition, there are numerous drill core samples awaiting assay results. It is the Company's intention to provide an update on recent drilling by the fourth quarter of this year. The Company's first priority is to put out an initial NI 43-101 compliant resource on the property by the second quarter of 2012. The decision to ramp up to five drills should greatly enhance the speed of delineation of potential for resources at Imwauna. Activity will include testing of the extensions along strike and at depth. The property has not yet been drilled beyond a depth of 150 metres.

The Company has received several proposals from a variety of firms in regards to the underground development work to be completed on the project. Following completion of the current financing, the Company will be selecting a contractor from one of those currently short-listed and work will commence once permitting is achieved and the scope of work defined.

The Company has also received bids to commence construction of a mine construction/operations camp. Once the financing is closed, the Company will conclude the selection process, and commence construction. As a priority, work will commence in this area, and in other site related construction upgrades (such as roads).

Additionally, work is continuing on the pre-feasibility study being managed by Lycopodium Minerals QLD in Brisbane, Australia. The Company has also retained independent mining and metallurgical consultants to assist it in this regard. The target date for completion of the Pre-Feasibility study remains May 2012.

The Company has to date spent $ 4.5 million of the $ 8 million required exploration and development expenditure to earn the remaining 50% interest in the Normanby licenses per the terms of the Option Agreement. The Company is taking appropriate measures, in the normal course, to submit its 50% Option Agreement to the Ministry of Mines and the Registrar of Tenements for approval and registration. The Company has previously received approval for the transfer of the initial 50% interest in the exploration licences acquired from the vendor and expects ministerial approval for the transfer of the remaining 50% interest to be approved in due course once the terms and conditions have been met.

About PNG Gold Corporation

PNG Gold Corporation is the new name of International Silver Ridge Resources Inc., after completion of its business combination with NMC Mining Corp. completed on June 7th, 2011. PNG Gold holds a 50% interest in the Imwauna and Sehulea properties on Normanby Island, Milne Bay Province, Papua New Guinea, and an option to acquire the remaining 50%. PNG Gold trades on the TSX Venture Exchange under the symbol PGK. PNG Gold's mission is to become the premier exploration and development company in Papua New Guinea.

ON BEHALF OF THE BOARD OF DIRECTORS

J.R.H. (Dick) Whittington, President & CEO

Forward-Looking Statements

Certain information set forth in this news release contains forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements relate to matters such as results of exploration and development of the Normanby Property and completion of financing and are subject to numerous risks and uncertainties, certain of which are beyond the control of PNG Gold, including, but not limited to, the impact of general economic conditions, industry conditions, financial market conditions, dependence upon regulatory and shareholder approvals, and the uncertainty of completing intended financing and obtaining additional financing. Exploration of mineral properties is subject to the inherent risk that it may not result in commercial discovery. Readers are cautioned that the assumptions used in the preparation of forward-looking statements, although considered reasonable at the time of preparation, may prove to be incorrect and, as such, undue reliance should not be placed on forward-looking statements. PNG Gold expressly disclaims any obligation to update forward-looking statements contained herein except as required by applicable law.

No regulatory authority has approved or disapproved the information contained in this news release. 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

  • PNG Gold Corporation
    Neil MacRae
    Investor Relations Manager
    (604) 669-4899
    (604) 685-2345 (FAX)
    www.pnggold.com