News Releases

Columbus Gold Options 50.01% of Montagne d'Or Gold Project to Nordgold; Deal Valued at $30 Million Minimum

September 18, 2013

Vancouver, B.C., September 18, 2013 - Columbus Gold Corp. (CGT: TSX-V) (“Columbus Gold”) is pleased to announce that it has entered into a binding letter option agreement (the “Agreement”) with major gold producer Nord Gold N.V. (“Nordgold”, LSE: NORD) under which Nordgold has been granted the right to a 50.01% interest in certain licences at Columbus Gold’s 100% owned Paul Isnard Gold Project in French Guiana (the “Project”). The Project hosts an inferred gold resource of 5.37 million ounce (117.1 Mt @ 1.43 g/t Au) in the Montagne d’Or gold deposit.

Nordgold may earn a 50.01% interest in the Project by completing a bankable feasibility study (the “BFS”) and by expending not less than US$30 million in 3 years in staged work expenditures, which includes a requirement for Nordgold to pay Columbus Gold $4.2 million in cash no later than May 21, 2014. The $4.2 million payment is due in consideration of Columbus Gold purchasing an underlying royalty on the Project. During the earn-in period, Columbus Gold will act as operator on the Project and charge a 10% management fee on certain expenditures.

Robert Giustra, CEO of Columbus Gold, commented: “This agreement is exceptional not only by its requirement for an experienced and world class mine developer to fund a considerable amount of spending but also for the fact that Columbus Gold shareholders retain half the project at feasibility. In addition, the deal provides Columbus Gold with the option to participate in mine construction or to delegate it to Nordgold for a resulting significant and valuable equity interest for Columbus Gold shareholders in a large producing mine.” Mr. Giustra further added: “This agreement clearly demonstrates our continued dedication to protecting our shareholders by transacting at the project level and not diluting the company, which also holds our large and prospective Nevada gold portfolio.”

The Agreement provides for a 50.01% / 49.99% joint venture (the “JV”) to be formed between the parties upon Nordgold earning its interest in the Project. In the event that the JV decides to advance the Project to mine construction and commercial production, Columbus Gold may elect to fund the JV pro-rated to its 49.99% interest or allow Nordgold to sole fund, whereby Columbus Gold’s interest would be diluted pursuant to a straight-line formula. The initial deemed value of each party’s interest in the JV, which affects the rate of dilution, will vary based on the ounces of proven & probable reserves indicated in the BFS (the “Ounces”). For example, pursuant to the formula, 2 million Ounces would require Nordgold to spend approximately $160 million to dilute Columbus Gold to a 25% interest; 3 million Ounces would require Nordgold to spend approximately $210 million to dilute Columbus Gold to a 25% interest; and 4.5 million Ounces would require Nordgold to spend approximately $270 million to dilute Columbus Gold to a 25% interest. In the event that the JV decides not to move forward to mine construction and commercial production within 4.5 months after BFS completion, Nordgold must offer 0.01% of the overall JV to Columbus Gold for a determinable price and each party will hold 50% in the JV.

During the option period, Nordgold has agreed to a standstill under which it will not obtain 20% or greater of the outstanding voting securities of Columbus Gold, will not solicit proxies from Columbus Gold’s shareholders, will not attempt to engage in discussions respecting fundamental transactions involving Columbus Gold, and will vote any securities it holds in favour of management proposals put forward by Columbus Gold. Columbus Gold understands that Nordgold currently holds no common shares in its capital.

The Agreement is subject to several conditions that must be satisfied on or before January 31, 2014, including obtaining the consent of underlying royalty holders and the approval of the TSX Venture Exchange. The Agreement contains other provisions standard for a binding letter option agreement, including an area of interest, force majeure extensions, termination provisions, and a requirement that it be replaced by a definitive agreement in due course. A copy of the Agreement will be available in due course on Columbus Gold’s SEDAR profile at


Nordgold (LSE: NORD) is publicly traded on the London Stock Exchange and is an international pure-play emerging-markets gold producer established in 2007. Nordgold has expanded rapidly through acquisitions and organic investment, achieving a rate of growth unmatched in the industry during that period. In 2012, Nordgold’s gold production was 717 Koz. The company operates nine mines in Russia, Kazakhstan, Burkina Faso and Guinea. Nordgold has one development project, four advanced exploration projects and a diverse portfolio of early exploration projects and licenses in CIS and West Africa. Nordgold employs over 10,000 workers on two continents.

Rock Lefran├žois, P.Geo. (OGQ), Columbus Gold’s Chief Operating Officer and Qualified Person under National Instrument 43-101, has reviewed and approved the technical content of this news release. For additional technical details on the Project, please see Columbus Gold’s news release dated February 5, 2013.


Robert F. Giustra
Chairman & CEO

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For more information contact:

Investor Relations
604-634-0970 or

This release contains forward-looking information and statements, as defined by law including without limitation Canadian securities laws and the “safe harbor” provisions of the US Private Securities Litigation Reform Act of 1995 (“forward-looking statements”), respecting the option, the earn-in conditions, the BFS, the payment of $4.2 million, advancement of project to mine construction and possible sale of 0.01% interest thereafter, the standstill, and the other conditions under the Agreement. Forward-looking statements involve risks, uncertainties and other factors that may cause actual results to be materially different from those expressed or implied by the forward-looking statements, including without limitation that Nordgold may not decide to exercise the option; that Nordgold may not have resources available to exercise the option; that a BFS may not be able to be prepared on the terms required under the Agreement; whether or not the JV will decide to move the Project to mine construction, and if not whether Nordgold will sell a 0.01% interest in the Project to Columbus Gold on the terms set out in the Agreement or at all; whether a party’s interest in the JV will be diluted; whether the standstill provisions will be followed and, if not, whether they are enforceable; that the conditions underlying the Agreement may not be able to be completed in a timely fashion or at all; the ability to acquire necessary permits and other authorizations; the feasibility of taking the Project into production; the number of Ounces delineated in the BFS; that production may never occur at the Paul Isnard Project; environmental compliance; cost increases; availability of qualified workers and drill equipment; competition for mining properties; risks associated with exploration projects, mineral reserve and resource estimates (including the risk of assumption and methodology errors); dependence on third parties for services; non-performance by contractual counterparties; title risks; and general business and economic conditions. Forward-looking statements are based on a number of assumptions that may prove to be incorrect, including without limitation assumptions: that Nordgold will decide to exercise the option; that Nordgold will have sufficient resources to keep the option in good standing and to ultimately exercise it; that a BFS will be able to be prepared on the terms and conditions set out in the Agreement; that the dilution formula will operate as set out in this release and in the Agreement; that the JV will decide to move the Project to mine construction and commercial production; that the standstill provisions will be followed and that they will be enforceable; that the conditions underlying the Agreement will be completed in a timely fashion; that general business and economic conditions will remain consistent; that the timing and receipt of required approvals will be timely in connection with the Agreement; that financing, if required, will be available; power prices; ability to procure equipment and supplies including without limitation drill rigs will be positive; and that ongoing relations with employees, partners and joint venturers will remain consistent. Although Columbus Gold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. 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. Columbus Gold undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change except as required by applicable law. The reader is cautioned not to place undue reliance on forward-looking statements.