Sargold Resource Corporation
TSX VENTURE : SRG

Sargold Resource Corporation

December 22, 2006 17:50 ET

Sargold Completes Monte Ollasteddu Agreement With Gold Fields

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Dec. 22, 2006) - Sargold Resource Corporation (TSX VENTURE:SRG) ("Sargold" or the "Company") is pleased to report it has completed the formal purchase agreement (the "Agreement") previously announced on October 30, 2006, with Gold Fields Netherlands Services B.V. (formerly known as Gold Fields Venezuela Holding B.V.) ("Gold Fields"), an indirect subsidiary of Gold Fields Limited, whereby the Company has acquired all of Gold Fields' interest in the Monte Ollasteddu project in Sardinia, Italy ("the Property"). With the completion of this Agreement, the Company now holds a 90% interest in the Property, with the remaining 10% held by Progemisa SA.

As outlined in the Agreement, the Company will issue to Gold Fields common shares of the Company ("Shares") with a value of C$500,000 (the "Consideration") in three installments: 833,333 Shares after signing the Agreement ("Closing Date"), based on a share price of $0.20 per Share, and Shares equal to one third of the Consideration on each of the first and second anniversaries of the Closing Date, based on a share price equal to the greater of: (a) the weighted average trading price of the Shares in the preceding 30 trading days and (b) $0.17 per Share). Gold Fields will have a right to acquire an undivided 66-2/3% interest in the Property, which could at their discretion be triggered when exploration work programs undertaken by Sargold on the Property have defined a minimum NI 43-101 compliant, measured and indicated resource estimate of 3.5 million ounces of gold.

Gold Fields has also completed a concurrent private placement of 5,000,000 Shares at a price of $0.25 per Share for proceeds of $1,250,000, which will be used for exploration work expenditures and operations on the Company's mineral properties.

The Company would also like to announce the granting of 750,000 stock options at $0.17 to an officer of the Company for a period of 5 years expiring December 22, 2011.

ABOUT SARGOLD RESOURCE CORP. Sargold controls the largest precious metals exploration and exploitation land area in Sardinia, Italy. The Company's properties and projects range from the mine and full processing plant at Furtei, to advanced exploration properties with historical gold resources across the island. Sargold owns 90% of Sardinia Gold Mining ("SGM"), the operating company based at Furtei. The island of Sardinia, located approximately 150 kilometers west of Rome, is the second largest in the Mediterranean Sea covering over 24,000 square kilometers.

ON BEHALF OF THE BOARD OF DIRECTORS,

Richard W. Warke, President & CEO

FORWARD-LOOKING STATEMENTS - The statements that are not historical facts are forward-looking statements involving known and unknown risks and uncertainties that could cause actual results to vary materially from targeted results. Such risks and uncertainties include those described from time to time in the Company's latest annual report and management discussion and analysis. The Company assumes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this News Release.

Contact Information

  • Sargold Resource Corporation
    Marlo Hamer-Jackson
    Investor Relations Manager
    (604) 687-1717
    (604) 687-1715 (FAX)
    Email: info@sargold.com
    Website: www.sargold.com