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~_ <br />w <br />Q <br />w <br />w <br />w <br />z <br />CONTACT <br />Comparry <br />Michael Owen <br />Chapman <br />Rpya~Resounri <br />1660 Wyn4Wp Sveel <br />sane nom remh viWr <br />Dem er. ( p~nraDu 80303 <br />OOL SJY1660 <br />ROYAL RESOURCES CORPORATION <br />7660 WYNKOOP STREET . SUITE 7000 TENTH FLOOR <br />DENVER,COLORAD080202 (3031573-1660 <br />NEWS FOR RF;LEASE: IMMEDIATE: NOVEMBER 12, 1986 <br />DENVER, COLORADO. ROYAL RESOURCES CORPORATION <br />(NASDAQ:RRC'O), and its wholly owned subsidiary Royal <br />Gold, Inc., announced today that they have acquired <br />a 25 percent interest in the Colosseum Gold Mine in <br />San Bernardino County, California for $4,155,000. <br />As part of the agreement, Royal has entered into a Joint <br />Venture Agreement with Dallhold Investments Pty Ltd <br />of Perth, Western Australia. Arrangements for financing <br />and construction costs were also completed. <br />The Colosseum gold mine is located near the Nevada- <br />California border approximately 50 miles west of Las <br />Vegas. The property was originally developed by Amselco, <br />a United States subsidiary of British Petroleum Company. <br />Amselco sold its interest in the mine to Colosseum <br />California .[nc. last year. Colosseum entered into a <br />previously :Lnnounced Letter of Intent with Royal on <br />May 5, 1986., Subsequently, Dallhold purchased the <br />shares of Colosseum California Inc. Under the <br />restructured ownership arrangements, Royal will own <br />a 25 percent: interest in the mine, and will be a 25 <br />percent pari;icipant in the joint venture. Colosseum <br />California ]:nc. will be the operator of the venture. <br />Dallhold Investments Pty <br />investment company owned <br />controlling interest and <br />management a.nd operation <br />mines whose total annual <br />200,000 ounces of gold. <br />Ltd is a private Australian <br />by Alan Bond. It has a <br />is responsible for the <br />of several Australian gold <br />production is approximately <br />The Colosseum mine is scheduled to go into production <br />in the third quarter of 1987. Once in production, it <br />is estimated that the Colosseum mine will produce 70,000 <br />ounces of gold per year at a projected average cost <br />of $171 per ounce. The price of gold currently is <br />approximately $407 per ounce. The ore body has been <br />well defined by extensive drilling. However, there <br />remains a deeper extension of the ore body which has <br />yet to be drilled and which provides a gotential for <br />increased gold reserves. The life of the Colosseum <br />mine is estimated to be a minimum of seven and one- <br />half years, based on existing drilling and economic <br />projections. <br />(more) <br />