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Aurora Minerals enters Joint Venture

Media release

Tuesday 21st June 2005

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Aurora Minerals has entered a joint venture with New Zealand company Emerald Mining Limited on its large Hazelbrook epithermal gold project in the North Island.

Emerald is a part of the Auckland-based Emerald group of companies, a group with European financial connections and extensive investments in New Zealand including property development, power infrastructure and equipment, tourism and forestry.

The Emerald group also has a dairy operation in the Hazelbrook area through Emerald Farming Limited.

Under the terms of the joint venture agreement Emerald may provide NZ$10 million (approximately A$9.5 million) for expenditure on Aurora's Hazelbrook Project to earn a 50 % interest.

Key Terms of the Aurora-Emerald Hazelbrook Joint Venture Agreement are:

  • Emerald will provide an initial NZ$2 million to the Hazelbrook Joint Venture for expenditure on the project over the next 12 months

  • Emerald has the right to provide a further NZ$2 million per year for each of the following 4 years to the Hazelbrook Joint Venture for expenditure on the project

  • Emerald Mining will have earned a 50% interest in the Hazelbrook Joint Venture after providing a total of NZ$10 million for expenditure. It may also choose to provide the NZ$10 million to the Hazelbrook Joint Venture in advance of the 4 year timetable noted above.

  • Aurora will not be required to contribute any funds until the NZ$10 million is spent

  • Aurora Minerals has the right to manage the Hazelbrook Joint Venture while it maintains a 50% or more interest and will have a casting vote on the joint venture operating committee while it maintains a 50% or more interest.

  • Emerald may withdraw from the joint venture following the expenditure of the initial NZ$2 million. Following expenditure of Emerald's NZ$10 million both Aurora and Emerald can each individually elect to contribute 50% of ongoing joint venture expenditure, or either party can elect to gradually dilute under a standard industry formula.

  • Aurora and Emerald to negotiate a development joint venture agreement in the future if they discover a deposit which warrants preparation of a bankable feasibility study for mining.

  • The joint venture incorporates all of Aurora's current Hazelbrook project comprising Prospecting Permit 39 270, covering 1013 square kilometres, and Exploration Permit 40 730 within it, and other permits the joint venturers agree from time to time.

  • Under the Crown Minerals Act the joint venture is subject to the consent of the Minister responsible for administering the Act.

The directors of Aurora believe the joint venture provides a funding mechanism to advance exploration, especially the expensive drilling phase, and potentially future development of the project.

Emerald have commented: "We welcome this investment in the Hazelbrook Joint Venture with listed company Aurora Minerals in what is a promising epithermal gold exploration project with the potential to add value to our investors' global portfolio".

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