SEMAFO TSX-SMF
MONTREAL, July 22 /CNW Telbec/ - SEMAFO Inc. (TSX: SMF) today announced
that it has acquired from Etruscan Resources inc. (TSX: EET) their minority
interest in the Samira Hill mine located in Niger. SEMAFO now holds an 80%
interest in the mine with the balance held by the Government of Niger.
Etruscan's 40% participation in the operating subsidiary, comprised of
preferred shares, loans and common shares, was purchased for $3 million along
with a 1.5% net smelter royalty. The royalty comes into effect after which
time the mine has produced 750,000 ounces, calculated as from July 1, 2009.
SEMAFO has been accorded a right of first refusal should Etruscan decide to
sell this royalty.
This transaction will positively affect SEMAFO's balance sheet reducing
long-term debt by $6.1 million while contributing a $3.1 million non-cash gain
to the income statement. Both items will be recorded in Q3 2009. Furthermore,
it provides greater operating flexibility for SEMAFO as the operator.
SEMAFO has been the operator of the Samira Hill mine since 2004, during
which time the mine has produced more than 340,000 ounces of gold. Samira
Hill's reserves and resources at the beginning of 2009 were: 631,000 ounces of
reserves, 1,294,000 ounces of measured and indicated resources and 608,000
ounces of inferred resources. Samira Hill production is sold at spot market
gold prices, its hedge book having been retired earlier this year.
About SEMAFO
SEMAFO is a Canadian-based mining company with gold production and
exploration activities in West Africa. The Company currently operates three
gold mines in Burkina Faso, Niger and Guinea. SEMAFO is committed to evolve in
a conscientious manner to become a major player in its geographical area of
interest, while maintaining principles and strengthening relationships to
increase shareholder value.
Forward-looking Statements
This press release may contain forward-looking statements. These
forward-looking statements include, but are not limited to, statements
regarding the Company's expectations as to the market price of gold, strategic
plans, future commercial production, production targets, timetables, mining
operating expenses, capital expenditures, and mineral reserve and resource
estimates. Forward-looking statements involve known and unknown risks and
uncertainties and accordingly, actual results and future events could differ
materially from those anticipated in such statements. Factors that could cause
future results or events to differ materially from current expectations
expressed or implied by the forward-looking statements include, but are not
limited to, fluctuations in the market price of precious metals, mining
industry risks, uncertainty as to calculation of mineral reserves and
resources, risks related to hedging strategies, risks of delays in
construction, requirements of additional financing and other risks described
in the Company's documents filed from time to time with Canadian securities
regulatory authorities. Although the Company is of the opinion that these
forward-looking statements are based on reasonable assumptions, those
assumptions may prove to be incorrect. Accordingly, readers should not place
undue reliance on forward-looking statements. Readers can find further
information with respect to risks in the Company's Annual Information Form and
other filings with Canadian securities regulatory authorities available at
www.sedar.com. The Company disclaims any obligation to update or revise these
forward-looking statements, except as required by applicable law.
