|March 29, 2012|
Elgin Mining Releases Full Year 2011 Financial Results
|Vancouver, British Columbia, March 29, 2012 -- Elgin Mining Inc. ("Elgin Mining" or the "Company") (TSX-V: ELG) reported today the release of its financial results for the year ended December 31, 2011 along with an update on the Company's project development activities. The Company's consolidated financial statements for the years ended December 31, 2011 and 2010 and notes thereto, along with its Management's Discussion and Analysis are available at www.sedar.com and www.elginmining.com. Unless otherwise noted, all financial information is expressed in U.S. dollars.|
2011 Financial Results
Plan of Arrangement with Gold-Ore Resources Ltd. ("Gold-Ore")
On February 1, 2012, the Company announced that it had executed an arrangement agreement whereby the Company would acquire all of the issued shares of Gold-Ore, owner of the Bjorkdal gold mine in Northern Sweden, by way of a plan of arrangement. Under the arrangement agreement, each Gold-Ore shareholder will be entitled to receive, for each Gold-Ore common share, one common share of the Company and one half of one common share purchase warrant of the Company exercisable at a strike price of Cdn$1.30 per share for a term of two years.
The transaction is expected to close in early May 2012, subject to the receipt of all necessary approvals. A copy of the arrangement agreement is available under the Company's profile on SEDAR and further details on this proposed business combination can be found in the Company's news release dated February 1, 2012.
The Company anticipates its proposed business combination with Gold-Ore will close in the second quarter of 2012, thereby, creating a larger, more diversified gold mining company with operations and development projects in the politically safe and stable jurisdictions of Sweden and Canada.
The Company's other key priorities for 2012 will include:
The Company intends to aggressively advance the Lupin Mine towards a restart of production in the first half of 2014. In working towards this goal, the Company will:
The Company intends to commence a regional exploration program at the Ulu Project.
Bjorkdal Gold Mine
The Bjorkdal gold mine has a long operating history of over twenty years having recently produced its first million ounces of gold in 2010. The gold mine is located in the prolific Skelleftea mining district in northern Sweden, providing the mine with the advantages of excellent infrastructure, a well-trained and knowledgeable local workforce, and supportive communities with a strong mining tradition.
The mine operates as a combined open pit and underground operation with a surface mill that produces four gold concentrates that are sold to nearby smelters. The mine has excellent exploration upside with the main ore body open in several directions and at depth.
Management intends to review mining methods and procedures and study options to reduce cash costs and improve production at the mine which may include:
The Bjorkdal gold mine generates strong cash flow and earnings which will provide the platform to improve ongoing operations and to accelerate exploration activities at the mine, and at the same time, will help fund the drive for future growth with the acceleration of the restart of the Lupin Mine. The Company will also continue to look for accretive opportunities within the mining industry.
Patrick Downey, President and CEO, commented, "2011 was a transformational year for the Company with the acquisition of the Lupin Mine and the Ulu Project, and the recruitment of an experienced mining team. With the proposed combination of the Company and Gold-Ore, we are excited about the challenge ahead of us in terms of the opportunities to optimize the operations of Bjorkdal and the plan to accelerate the restart of operations at the Lupin Mine. The Company is on its way to becoming a larger, more diversified, international gold mining company in mine-friendly jurisdictions, and is well-positioned to meet its stated business objectives in the current strong gold price environment."
Ms. Vivian Park, P.Geo., the Manager, Exploration of the Company and a Qualified Person as defined by NI 43-101, has reviewed and approved of the written technical disclosure contained in this news release.
Elgin Mining Inc.
Elgin Mining is a Canadian based company focused on the exploration and development of the Lupin Gold Mine and Ulu Gold Project, both located in Nunavut Territory, Canada. In addition, the Company's portfolio includes a 37% interest in Auracle Resources, which is exploring the Mexican Hat property in Arizona and an exclusive right and option to earn a 60% interest in Lincoln's Oro Cruz (California) and La Bufa (Mexico) gold projects. The Company will also selectively review opportunities to add advanced stage development projects to its portfolio.
For further information, please visit the Company's web site at www.elginmining.com.
Elgin Mining Inc.
President and Chief Executive Officer
Tel: (604) 682-3366 / Fax: (604) 682-3363
Certain information set forth in this press release contains "forward-looking statements", and "forward-looking information" under applicable securities laws. Except for statements of historical fact, certain information contained herein constitutes forward-looking statements which include management's assessment of Elgin Mining's future plans and operations and are based on Elgin Mining's current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. Some of the forward-looking statements may be identified by words such as "expects" "anticipates", "believes", "projects", "plans", and similar expressions. These statements are not guarantees of future performance and undue reliance should not be placed on them. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Elgin Mining's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Elgin Mining undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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