Quartet Resources LTD (QRL.P)

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Queenstake Announces $10 Million Private Placement
From Newmont - PR Newswire



Queenstake Announces $10 Million Private Placement From Newmont
DENVER, March 30 /PRNewswire-FirstCall/ --

Queenstake Resources Ltd.
(Amex: QEE; TSX: QRL) -
has entered into an agreement with Newmont Canada Limited
(Newmont) whereby Newmont will purchase 28.51 million
Queenstake common shares at Cdn$0.41 per share for gross
proceeds of US$10 million through an equity
private placement.

As part of the private placement, Newmont will receive
warrants that can be exercised to acquire up to
28.51 million common shares of Queenstake at a price
of Cdn$0.55 for a four-year period, which would generate
Cdn$15.7 million in cash if exercised.

After closing, Newmont will own approximately 4.9% of
Queenstake's basic common shares.

If Newmont were to exercise all of its warrants and
maintain its holdings of Queenstake's basic outstanding
common shares, Newmont would hold approximately 8.5%
of Queenstake's fully diluted outstanding common shares.

For a period of two years from closing, Newmont will
have the right to participate in future equity offerings
by Queenstake to preserve its fully diluted shareholding
percentage and will have certain additional rights to
participate in debt financings.

An affiliate of Newmont will also convey three of its Nevada
exploration properties, including -
the Shwin Ranch project along the Cortez-Battle
Mountain Trend, to Queenstake.

In addition, another affiliate of Newmont will sell
concentrates and ore from its Nevada operations to
Queenstake for processing at its Jerritt Canyon roasting
and milling facility in Northeastern Nevada.

The contract calls for the purchase of at least 500,000 tons
per year over two years.

Ore purchases with Newmont may continue for up to three
more years if Queenstake has the spare processing capacity.

Dorian L. (Dusty) Nicol, President and Chief Executive
Officer of Queenstake, said, 'We are leveraging
the value of our Jerritt Canyon assets through this
multi-faceted strategic transaction with Newmont.

This deal delivers four significant value enhancers
for our shareholders -- processing and production
optimization, exploration acceleration, financial
flexibility and portfolio diversification.

The alliance with the world's leading gold company
reflects positively on our exploration and processing
expertise and our prospective, 119-square mile
exploration land package.'

The locations of the three Nevada early stage exploration
properties with respect to Jerritt Canyon are shown
on the map in the Appendix (please refer to
www.queenstake.com
for the map).

A brief description of each property follows:

* Shwin Ranch -- Located on the Cortez Trend.
The property has potential
for sediment-hosted Carlin style gold mineralization
as well as skarn mineralization.
Some drilling has been done on the property, but there
are several recognized targets that remain undrilled
together with the potential to generate additional
targets.

* South Carlin -- Located on the Carlin Trend,
between Newmont's Rain and Gold Quarry mines.
The property hosts Carlin style gold targets.
Limited historical drilling has not fully tested
these targets and there is also potential to generate
additional targets.

* Baxter -- Located on the north end of the Carlin
Trend, about 25 miles southwest of the Jerritt Canyon
property boundary, six miles northwest
of Barrick's Meikle Mine and about a mile from
Hecla Mining's Hollister project.
Past drilling has only partially tested potential
sediment-hosted Carlin type gold targets.

The properties are subject to a sliding scale net smelter
royalty, dependent on the gold price, of 3% to
a maximum of 5% if gold is at or above $500 per ounce,
with Newmont retaining the right to back into a 51% joint
venture interest in each of the properties.

The purchase of Newmont's concentrates and ore for
processing of at least 500,000 tons per year over
two years will increase the Jerritt Canyon mill
throughput to approximately 95% of its past
demonstrated capacity of approximately 1.5 million
tons (1.4 million tonnes) per year.

Queenstake had previously projected a steady state mining
and processing rate of approximately 0.9 million tons
annually under the redevelopment plan.

This contract is expected to lower the Company's cash
operating costs by approximately $15-$20 per ounce
for production from Jerritt Canyon by reducing the
fixed costs per ounce.

It also will allow blending of Jerritt Canyon ore for
improved efficiency.

The private placement, which remains subject to certain
closing conditions, including regulatory approvals,
is expected to close within about four weeks.
Proceeds will be used to fund exploration and for
other corporate uses.

Queenstake was advised in this transaction by
Blackmont Capital Inc. and will pay advisory fees in
connection with the transaction.

The securities referenced herein have not been and will
not be registered under the United States Securities Act
of 1933 and may not be offered or sold in the United States,
unless an exemption from registration is available. After a
contractual six-month holding period, the shares held by
Newmont may be freely traded in Canada.

Queenstake Resources Ltd. is a gold mining and exploration
company based in Denver, Colorado.
Its principal asset is the wholly owned Jerritt Canyon
Gold mining operations and district in Nevada.

Jerritt Canyon has produced over seven million ounces
of gold from open pit and underground mines since 1981.

Current production at the property is from underground
Gold mines.

The Jerritt Canyon District comprises 119 square miles
(308 square kilometers) of geologically prospective
ground and represents one of the largest contiguous
exploration properties in Nevada.

For further information call:
Wendy Yang 303-297-1557 ext. 105
800-276-6070
Email - [e-mail]
web - www.queenstake.com

Cautionary Statement -- This news release contains 'Forward-Looking Statements' within the meaning of applicable Canadian securities regulations and Section 21E of the United States Securities Exchange Act of 1934, as amended and the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included in this release, and Queenstake's future plans are forward-looking statements that involve various risks and uncertainties. Such forward-looking statements include, without limitation, (i) estimates and projections of future gold production, processing rates and cash operating costs, (ii) estimates of savings or cost reductions and (iii) estimates related to financial performance, including cash flow. Forward-looking statements are subject to risks, uncertainties and other factors, including gold and other commodity price volatility, operational risks, mine development, production and cost estimate risks and other risks which are described in the Company's most recent Annual Information Form filed on SEDAR (www.sedar.com) and Annual Report on Form 40-F on file with the Securities and Exchange Commission (SEC; www.sec.gov) as well as the Company's other regulatory filings. Although the Company 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 as 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. Accordingly, readers should not place undue reliance on forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE Queenstake Resources Ltd.
http://www.investorshub.com/boards/board.asp?board_id=5466

Source: PR Newswire