Vanguard Mining Corporation has signed an agreement with PT Cendrawasih International to acquire a 70% equity interest in an 8100 hectare gold tenement in Mandailing Natal, North Sumatra.

Vanguard will pay US$6.5 million in a combination of cash and stock of the company for a 70% equity interest in the concession, which has estimated gold deposits between 400,000 to 1 million ounces, subject to independent technical verification. This transaction is scheduled to close after satisfactory legal, financial and technical due diligence review.

Vanguard and PHI Capital Holdings, a Nevada corporation, will be responsible for raising the required capital to develop and operate this mining project, whereas PT Cendrawasih will pay its part of capital contribution out of its proportional share of profits from the gold mine operation.

PT Cendrawasih’s spokesman Jay Muhd said: “We look forward to completing professional exploratory work on the gold tenement, including a JORC-compliant feasibility study, in order to bring the property to operation and production status. This cooperation will bring amazing revenues and ultimately incredible shareholder value.”

Vanguard’s senior geologist and executive vice chairman Quang Le said: “The surrounding gold mining activities include Sumatra Gold & Copper (two concessions of 4997 and 4719 hectares each) and Sihayo Gold (33,000 hectares), both publicly traded companies on ASX. We are expecting to have great success in developing our own concession in the same area.”

Vanguard Mining Corporation, a Nevada corporation established in 1987, is building a portfolio of mineral assets in South East Asia, including limestone in Vietnam and gold, copper, limestone, and manganese in Indonesia. The company has also investigated mineral asset opportunities in other geographical areas.

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