Information on proposed transaction between IGE and Alluvia Mining.

IGE has entered into an agreement with Alluvia Mining to purchase Ghana Gold AB, including the right to purchase six recovery lines to be delivered by AuVert Recovery System Ltd for production of alluvial diamonds and gold. The full purchase price of these recovery lines amounts to USD 15 million per recovery line, of which USD 2 million per recovery line has been paid (in total USD 12 million) by Ghana Gold. At the time of closing of the transaction, Alluvia will have transferred its partner agreement (the “Partner Agreement”) with listed company Mineral Invest regarding the exploitation of Mineral Invest’s alluvial gold license Wanga and the exploitation activities under the Moyale license in Ethiopia to Ghana Gold.

IGE Resources AB

IGE is an exploration and mining company with a considerable diamond and nickel/magnetite resource base. The Group has a portfolio of four diamond projects in Africa and a nickel (Ni) and magnetite (Fe) project through Nickel Mountain Resources AB, its subsidiary in Sweden. The objective is to maintain a balance between projects of moderate risk and those with substantial upside potential.

IGE’s short-term objective is to start up alluvial gold- and diamond production in Africa. IGE’s long-term objective is to deliver healthy returns on its mining resources and investments while remaining known for a sustainable development commitment

IGE is headquartered in Stockholm and its shares are listed on the Oslo Stock Exchange (ticker: IGE).

Alluvia Mining Ltd

Alluvia is a diversified precious metals development and mining company. Alluvia has alluvial properties located in the United States, Chile and Suriname. Alluvia’s strategy is to identify high-quality, undervalued assets with growth potential on a large scale, to develop such assets in collaboration with engineering partners, and to commence production and generate returns from such previously undervalued assets whilst positioning itself at the forefront of the industry in establishing environmentally friendly alluvial mining.

Alluvia is today listed at the Mangold list in Stockholm but is currently in the process for listing on an MTF during the second quarter 2013.

IGE acquires Ghana Gold AB from Alluvia

IGE has entered into an agreement with Alluvia Mining to purchase Ghana Gold AB, including the right to purchase six recovery lines to be delivered by AuVert Recovery System Ltd for production of alluvial diamonds and gold. The full purchase price of these recovery lines amounts to USD 15 million per recovery line, of which USD 2 million per recovery line has been paid (in total USD 12 million) by Ghana Gold. At the time of closing of the transaction, Alluvia will have transferred its partner agreement (the “Partner Agreement”) with listed company Mineral Invest regarding the exploitation of Mineral Invest’s alluvial gold license Wanga and the exploitation activities under the Moyale license in Ethiopia to Ghana Gold.

Transaction details

  • SEK 50 million in cash
  • 50 million new issued shares of IGE
  • 10 percent of the Net Smelter Royalty (NSR), the gross revenue (total revenue minus production costs) from IGE’s sale of metals from it’s alluvial projects included in the Partner Agreement.

AuVert Recovery Systems – High efficient Recovery plants
IGE has today established alluvial assets in Africa. Assuming alluvial deposits are discovered, AuVert’s turn-key system is probably the most efficient way to extract gold. With traditional extraction methods usually achieved an uptake around 40-60 percent, AuVert system shows the result of over 90 percent uptake all through the system. By this viable production with 0.5 g/t Au, makes the production very efficient. AuVert uses no chemicals and requires 80 percent less water than competing systems. The environmental benefits are particularly important in sensitive nature license areas in Africa where IGE is active.

The AuVert system consists of several components that are linked together in a way that provides a higher performance than what each unit has been able to extract separately. The system has evolved over more than two decades in the mining areas around Alaska in the U.S. and Valdivia in Chile. The facilities are turn-key with all the technology, a training package for the personnel who will operate them as well as the necessary vehicle for a quick start of production and efficient operation. The findings are automatically allocated into a lockbox system unavailable to the personnel operating the rig.

The Moyale Gold Project
The concession covers an area of 90km2, located a few km from Moyale town in Ethiopia, with an excellent local set-up in the town of Moyale which is connected with an asphalt road from Addis Ababa. There is a good local infrastructure, including an airstrip in Moyale town, and the total license area is accessible with vehicle. The largest cash generating industry in the area is gold from alluvium, elluvium and bedrock and there is a large potential in alluvial mining.

The Wanga Gold Project

The concession covers an area of 1442km2 and incorporates 5 exploitation licenses in the Haute Uele region of the Orientale Province, Democratic Republic of Congo. The concession area is situated on the western boundary of the Kilo-Moto Gold Belt one of the world’s richest gold areas. To the north, the Kibali River flows across the north-eastern corner of the license. Along the western border, the Yebu River runs from south to north eventually flowing into the Kibali. The Rand Gold/Ashanti Gold Kibali Gold Project is situated 20 km to the west of the license with current reserves of 10Moz Au and additional resources of 18Moz Au. Within the concession area there are a number of sites where historical bedrock and placer gold mining operations took place. Many of these locations are now being exploited by local artisanal mining activities. SRK evaluated according to JORC standards: Total inferred 484,400 tonnes of tailings containing 13,900 Oz gold at average grade of 0.89g/t Au. The SRK evaluation is based only on a fraction of the old tailings available in the Wanga project. Belgian miners have produced gold here for over 30 years but closed the project down in 1956. The tailings have been untouched since then. For obvious reasons, the technique used then was far more inefficient than the alluvial technique used today, and IGE believes that the former miners were not able to extract more than 50% of the capacity. With huge tailings and huge virgin soil easy to operate with AuVert machinery in one of the most Gold richest places in the world, IGE is convinced that this is a great opportunity for IGE.

For additional information, please contact:

Ulrik Jansson
Chairman of the Board, IGE Resources AB
Tel: +46 70 751 41 84
E-mail: ulrik.jansson@crownenergy.se

Terje Engstrøm Lien
Interim President and CEO, IGE Resources AB
Tel: + 47 926 15 167
E-mail: tel@ige.se

IGE Resources AB (publ) is a Scandinavian asset management and development company within natural resources. IGE’s portfolio currently consists of several diamond exploration and production assets in Southern Africa and Nickel Mountain Resources AB (publ) owning Scandinavia’s largest nickel deposit. IGE is headquartered in Stockholm and its shares are listed on the Oslo Stock Exchange (ticker: IGE). Please refer to www.ige.se for more detailed information.

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