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Macraes gold due back on the exchange

Thursday 11th December 2003

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Gold mine Macraes is due to end up listed on the New Zealand Exchange again through a GRD IPO.

GRD says the new company, Oceania Gold, will include all of the assets and undertakings of GRD Macraes Limited.

The IPO will facilitate the increase of Oceana Gold's production base from approximately 170,000 ounces per annum to 350,000 Π400,000 ounces per annum. At the same time the company will undertake a significant drilling program at Sams Creek, targeted at delineating a porphery gold system.

The IPO is expected to raise about $100 million of which $50 million will comprise new equity in Oceana Gold and the balance will be the sell down of part of GRD's interest.

The new equity raised for Oceana Gold will be used to simultaneously develop the Reefton Gold Project and Frasers Underground at the Macraes Gold Project in the South Island of New Zealand.

For those GRD shareholders seeking a direct exposure to Oceana Gold, GRD expects to undertake a buy-back of GRD shares in exchange for Oceana Gold shares up to $60 million, giving those shareholders the ability to efficiently switch part or all of their GRD shareholding to Oceana Gold.

At an Oceana Gold IPO issue price of $1.00 per share, GRD will offer 2.4 Oceana Gold shares for each GRD share. This gives an implied price to participating GRD shareholders of approximately $2.40 per GRD share exchanged.

If the buy-back is not fully accepted, then the balance of the Oceana Gold shares will be distributed to GRD shareholders as a pro-rata distribution in specie.

Following the capital raising, sell down and return to its shareholders, GRD is expected to hold 60% of Oceana Gold.

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