Copperstone Air Photo showing Target Zones & Development
| ||January 31, 2003|
American Bonanza Closes Private Placement And Gains Goldcorp Inc. As A Major Shareholder
| ||AMERICAN BONANZA GOLD MINING CORP. (the "Corporation") is pleased to announce it has completed the previously announced brokered private placement totaling 18,295,454 units of the Corporation at a price of $0.22 per unit, for gross proceeds of $4,025,000, which includes the exercise of an over allotment option by its agent Canaccord Capital Corporation ("Canaccord"). Each unit is comprised of one common share and one half of a non-transferable common share purchase warrant with each whole warrant entitling the holder to acquire one common share at a price of $0.28 until January 31, 2004. Canaccord as agent for this private placement have been paid an agent's fee of 7% on the gross proceeds and agent's warrants equal to 10% of the units sold. The Corporation also issued a corporate finance fee to Canaccord of 450,000 units with each unit consisting of one common share and one whole common share purchase warrant. All of these securities are subject to Exchange and Securities Act hold periods expiring May 31, 2003. The proceeds of this financing will be applied to general corporate working capital and be used for the further development and exploration of the Copperstone project.|
The largest subscriber in the private placement was Goldcorp Inc. who will own approximately 10.4% of the Corporation on a fully diluted basis. The Corporation's President and CEO Brian Kirwin stated "This investment by Goldcorp is a milestone in the Corporation's mission to become a high-grade gold producer. Bonanza is very pleased to have Goldcorp as a major shareholder while the Copperstone project is advanced towards production."
The Corporation has recently resumed underground drifting operations and is currently extending the decline to the bonanza grade mineralization of the D-Zone on the Copperstone project. The objective of the Copperstone decline project is to establish underground infrastructure for subsequent exploration and development programs. A major objective will be detailed drilling and sampling from underground to convert resources to reserves. Additionally, the decline will provide access to high grade material that will be extracted for processing at a later date.
The existing decline lies less than 500 feet (150 metres) south of the first target within the D-Zone, which lies at the southern end of the D-Zone. This first target is the mineralized interval within core hole C96-19, which was drilled from surface and contains 10 feet (3.1 metres) of mineralization grading 5.3 ounces of gold per ton (182 grams of gold per tonne), as previously disclosed.
MRDI Canada, a division of H.A. Simons Ltd., ("MRDI") an independent mine engineering firm was retained by the Corporation's predecessor company during 1999 to assist in a scoping level evaluation of an underground mine at Copperstone. Exploration drilling on the project outlined four zones of mineralization defined as the A, B, C and D zones with gold mineralization occurring principally within the Copperstone Fault. As has been previously disclosed, the scoping study evaluated the underground mine development of only the C and D zones, and estimated a global geological resource for the C and D zones that exceeds 2.0 million tons at an average uncut grade of 0.58 Au opt, containing over 1.2 million ounces of gold.
About American Bonanza
The Corporation is engaged in the acquisition, exploration and development of high-grade gold properties. The Corporation's innovative metallogenic techniques developed at considerable expense represent state-of-the-art tools for modern exploration in the Great Basin of the American Southwest. The Corporation's metallogenic techniques have involved technical pioneering in terms of geological data analysis, hardware and software applications and will be the catalyst for future corporate growth.
Additional information about American Bonanza can be obtained at www.americanbonanza.com
AMERICAN BONANZA GOLD MINING CORP.
(signed) Brian Kirwin
President and Chief Executive Officer
The TSX Venture Exchange has not reviewed and does not accept responsibility
for the adequacy or accuracy of this news release.
For further information call or write:
Brian Kirwin, President and Chief Executive Officer (775) 824-0707
Giulio T. Bonifacio, Executive Vice President and Chief Financial Officer (604) 699-0023
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