RENO, Nev., Aug. 2, 2005 (PRIMEZONE) -- Western Goldfields, Inc. (OTCBB:WGDF) and Romarco Minerals Inc. (TSX-V:R) are pleased to announce that preparations to merge the two companies are continuing and that the two companies will begin to focus on initiating a feasibility study at the Mesquite mine in preparation for commencing mining operations.
The Mesquite Mine will be the core operating asset of the combined company and it will have a strong portfolio of advanced stage exploration projects. Currently, Romarco is drilling its Buckskin-National Project (100%, Nevada) and has plans to drill on the vein targets at Pine Grove (60% option agreement with Toquima Minerals) later this year.
The combination will be effected through a share exchange merger whereby Romarco will issue its shares in exchange for shares of Western Goldfields. Details of the share structure will be finalized in the definitive merger agreement. Upon completion of the share exchange transaction, Diane Garrett (Romarco Pres. and CEO) will become Chief Executive Officer of the combined company and Thomas (Toby) Mancuso (Western Goldfields Pres. and CEO) will become President of the combined company.
The previously announced proposed three-way merger agreement between U.S. Gold, Romarco and Western Goldfields has been terminated.
Mesquite Mine
The Mesquite Mine is a fully permitted, gold producing property located in southern California. The Mesquite Mine was purchased from a subsidiary of Newmont Mining Corp. (NYSE:NEM) by Western Goldfields in 2003. The property is currently producing gold from residual leaching of the heaps. A feasibility study will be initiated immediately to determine the viability of starting up full scale mining operations. Other details include:
-- Past production of 200,000 ounces per year @ approximately
$200 average cash costs
-- Fully permitted
-- Currently producing approximately 25,000 ounces per year from
ore on the leach pads
-- High grade mineralization near surface and at depth
- MR-3052 -24m averaging 23 g/t gold including 9m @ 58 g/t, the
highest grade intercept being 1.5m @ 210 g/t
- SM-1404 -15m @ 33 g/t gold including 3m @ 151 g/t
- SM-1970 -3m @ 133 g/t gold including 1.5m @ 257 g/t
- MR-2793 -15m @ 12 g/t gold including 3m @ 60 g/t
-- High grade gold mineralization also encountered in many other
areas throughout the permitted mine site
Romarco Exploration Project Update:
At the Buckskin-National Gold Project in Nevada, drilling is currently underway.
At the Cori Puncho gold project in Peru, Romarco's technical team is currently assessing the property and identifying drill targets for the 2005 drill season. Additional details will be forthcoming as work programs become finalized.
Ground work including mapping and sampling is currently being conducted on Romarco's Roberts Mountains Gold Project located in the Battle Mountain Eureka Trend of Nevada and on the Pine Grove Gold Project located in the Walker Lane district of Nevada.
The proposed transaction is subject to board approval of the definitive merger agreement, the satisfactory completion of final due diligence, opinions from each company's financial advisor that the transaction is fair, from a financial point of view, to each company's respective shareholders, and to shareholder approval.
Romarco's Qualified Person Robert M. Hatch, Vice-President, Exploration for Romarco Minerals Inc.
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