Xanadu acquire copper, gold project in Mongolia

Xanadu to acquire copper, gold project in Mongolia

9:10 AM, 11th May 2012
Xanadu to acquire copper, gold project in Mongolia

DARLINGHURST, AUSTRALIA: Xanadu Mines Ltd has executed a terms sheet with Temujin Mining Corp to acquire the prospective Oyut Ulaan copper and gold project in the South Gobi region of Mongolia via a purchase of Temujin’s wholly owned subsidiary Vantage LLC. Once definitive documentation is finalised and a mining licence issued on the project, which will earn Xanadu an initial 25 per cent project interest, the Board of Xanadu will propose the purchase of the remaining 75 per cent of the project be approved at a general meeting of shareholders.

This process is expected to be completed in next quarter however either party will have the right to terminate the Terms Sheet if the definitive documents are not entered within 30 days. Consideration for the acquisition will include the issuance of new shares in Xanadu comprising 3.95 million shares and $4.25 million of shares based on a price equal to the 15 day volume-weighted average price as calculated on the day of the general meeting.

An additional 15 million shares will also be issued to Temujin upon Xanadu defining a JORC compliant resource over a mineable area of the project of at least 90 metric tonne at an average one per cent copper equivalent and subject to a favourable pre-feasibility or scoping study. Xanadu is committed to spend a minimum of $5 million on the project in the 30 months after the mining licence is granted.

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