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Acquisition of New Celebration Gold Mine

Document date:  Fri 29 Jun 2001
Published:  Fri 29 Jun 2001 00:00:00
Document No:  198098
Document part:  A
Market Flag:  N
Classification: 

HILL 50 GOLD NL                               2001-06-29  ASX-SIGNAL-G

HOMEX - Perth                                                         

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The Directors of Hill 50 Gold NL ("Hill50") are pleased to advise
that the company has reached agreement to purchase the New
Celebration Gold Project ("New Celebration") from Newcrest Mining
Limited, effective close of business June 30, 2001.

Hill 50's Managing Director, Peter Cook said "The Company has been
quite stagnant for the last two years whilst it focussed its
attention upon the revival and expansion of its Mt Magnet Gold
Project into a profitable and long-life gold producer. The Board has
been certain not to cripple the Company with debt through this phase
and has managed to achieve the results at Mt Magnet without the
Company incurring any debt."

The acquisition of New Celebration adds to Hill 50's Mt Magnet
operations, currently producing at 200,000oz per annum and further
compliments the Company's growth strategy that has seen it pick up
the advanced Maud Creek Gold Project in the Northern Territory and a
substantive exploration project at Golden Grove in the previous 6
months.

The purchase price is $10 million plus adjustments for stores,
consumables and gold outside of normal levels. A royally of A$10/oz
on all production above 400,000oz from the tenements and a contingent
payment of $1million dollars for each new discovery with an ore
reserve greater than 250,000 oz is also payable to Newcrest. The
acquisition will be funded by debt.

The New Celebration Gold Project is located 30km south of Kalgoorlie
and comprises a package of some 67 mining tenements covering over
450sq km's and straddling several fault's/shears including the major
Boulder/Lefroy fault system and some of the most prospective
greenstone in the Eastern Goldfields of Western Australia.

The New Celebration Gold Project produced its first gold in December
1986 and to June 30, 2001 has produced just less than 1.5 million
ounces.

The December 31, 2000 Identified Mineral Resource Statement of
Newcrest estimated a Total Resource inventory of 13 million tonnes at
2.6g/t Au containing 1.1 million ounces of In Situ gold. Total
Reserves were estimated at 1.3 million tonnes at 4.1g/t Au containing
170,000 ounces of In Situ gold. In addition unclassified resources
were estimated at 12.0 million tonnes at 1.7g/t Au containing 660,000
ounces.

The project has been acquired on a going concern basis with gold
production for the ensuing year estimated at approximately 90,000
ounces source solely from the Mt Marion underground mine.

Hill 50's Managing Director Peter Cook said, "The New Celebration
acquisition is in similar circumstances to the Company's acquisition
of Mt Magnet in 1997. It has a great address and we see great
opportunity to revive the project and add substantial value for our
shareholders."

Hill 50 is continuing to evaluate growth and expansion opportunities.

P Cook
MANAGING DIRECTOR

Enquiries:     Peter Cook - MANAGING DIRECTOR
               Phone: 61-8-9485 0070
               Fax:   61-8-9485 0074
               Email: peterc@hill50.com.au

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