Yamana Gold Inc.

Yamana Gold Inc.

March 31, 2006 12:32 ET

Shareholders of Desert Sun Mining Corp. Support Merger with Yamana Gold Inc.

TORONTO, ONTARIO--(CCNMatthews - March 31, 2006) - Yamana Gold Inc. ("Yamana") (TSX:YRI)(AMEX:AUY)(AIM:YAU) and Desert Sun Mining Corp. ("Desert Sun") (TSX: DSM, AMEX: DEZ) today announced that the shareholders of Desert Sun have overwhelmingly voted in favour of the proposed arrangement between Yamana and Desert Sun relating to the purchase by Yamana of Desert Sun. The arrangement will be effective on April 5, 2006, subject to the receipt of final court approval expected on April 4, 2006.

As part of the business combination, the board of directors of Yamana will be comprised of Messrs. Peter Marrone, Victor Bradley, Patrick Mars, Juvenal Mesquita Filho, Antenor Silva, Nigel Lees, Dino Titaro, Stan Bharti and Bruce Humphrey. To facilitate the transaction and to accommodate the addition, of new directors, Mr. James Askew has stepped down from the board of directors effective March 31, 2006. Yamana would like to thank Jim for his contributions to the Company over the last 3 years.

About Yamana

Yamana is a Canadian gold producer with significant gold production, gold and copper-gold development stage properties, exploration properties, and land positions in all major mineral areas in Brazil. With the acquisition of Desert Sun, Yamana also owns the Jacobina Mine. Yamana expects to produce gold at intermediate company production levels in 2006 in addition to significant copper production by 2007. Company management plans to continue to build on this base through the advancement of its exploration properties and by targeting other gold consolidation opportunities in Brazil and elsewhere in Latin America.

Cautionary Statements

This news release contains "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995 and similar Canadian legislation, concerning the business, operations and financial performance and condition of each of Yamana and Desert Sun. Forward-looking statements include, but are not limited to, statements with respect to estimated production, synergies and financial impact of the proposed transaction; the benefits of the proposed transaction and the development potential of Yamana's and Desert Sun's properties; the future price of gold and copper; the estimation of mineral reserves and resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; capital expenditures; success of exploration activities; permitting time lines and permitting, mining or processing issues; currency exchange rate fluctuations; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; title disputes or claims; and limitations on insurance coverage. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made, and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Yamana and Desert Sun to be materially different from those expressed or implied by such forward-looking statements, including but not limited to risks related to: unexpected events during construction, expansion and start-up; variations in ore grade, tones mined, crushed or milled; variations in relative amounts of refractory, non-refractory and transition ores; delay or failure to receive board or government approvals; timing and availability of external financing on acceptable terms;
the businesses of Yamana and Desert Sun not being integrated successfully or such integration proving more difficult, time consuming or costly than expected; not realizing on the anticipated benefits from the Yamana/Desert Sun transaction or not realizing on such anticipated benefits within the expected time frame; risks related to international operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of economic valuations; changes in project parameters as plans continue to be refined; future prices of gold and copper; possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in the completion of development or construction activities, as well as those factors discussed in or referred to in the current annual Management's Discussion and Analysis and current Annual Information Form of each of Yamana and Desert Sun filed with the securities regulatory authorities in Canada and available at www.sedar.com, and Yamana's Form 40-F filed with the United States Securities and Exchange Commission. Although management of each of Yamana and Desert Sun has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Neither Yamana nor Desert Sun undertakes to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.

Contact Information

  • Yamana Gold Inc.
    Peter Marrone
    President and Chief Executive Officer
    +1 (416) 815-0220
    Desert Sun Mining Corp.
    Bruce Humphrey
    President and Chief Executive Officer
    +1 (416) 861-0341