MONTREAL, Sept. 12, 2005 (PRIMEZONE) -- East Delta Resources Corp. (OTCBB:EDLT) (Frankfurt:EJK) announced today that its wholly owned Chinese subsidiary, Guiyang High Tech Meiya Investment, Ltd., has finalized the acquisition of a producing gold mine purchased from the Chinese mining company Huaquiao Gold Mines. The acquisition gives EDLT 77.5% ownership of Huaquiao's Gold Mine in Jinping County, Guizhou Province (China).
Under the terms of the purchase agreement, Guiyang High Tech Meiya Investment will be required to inject a total of $500,000 over the next three months as part of a $2,000,000 modernization, upgrade and expansion program to be carried out over the next year.
The Huaquiao gold property is located in the southeast part of Guizhou province lying within the Hunan-Guizhou gold belt. The mine has been operating and extracting gold for about ten years producing more than five tonnes of gold to date. In the last two years, the mine generated a total of 20,000 ounces.
Within the property, seven independent ore zones at varying depth levels have been identified. Currently, most mining activity is confined to the M6 level. Data supplied to EDLT by Huaquiao indicate a remaining resource estimated at approximately 225,000 ounces of gold with the ore averaging 7.35 g/t and an extraction cost of under $235 per ounce.
Initially, the Company will scale back current mining operations at Huaquiao as a prelude to its modernizing and increasing the gold production capacity and expects to resume, then increase and bypass recent production levels within six months.
Victor Sun, President and CEO of East Delta, emphasized, "The importance of this transaction is that now we are no longer a development stage company. In the quarter commencing October 1, we expect to report our first revenues from mining operations, albeit relatively small during the expansion phase of the mine. We are excited because we will be joining what until now is a very small and select group; actual North American producing gold miners in China."
East Delta's chief geologist, Dr. Lu Huan-Zhang said, "Immediately following our own confirmation of the resource and evaluation of operating requirements, our plans are to dramatically increase production at Huaquiao through a three-pronged approach: by bringing in modern production and management techniques; purchasing new and more effective equipment to increase current yields; and extending extraction activities to the M6 levels of the mine. We intend on making optimal use of one of the biggest assets of this mine; its production capacity. It was designed to process up to 500 tonnes of ore per day using a ball mill system for grinding to obtain better yields. We are developing plans to ramp up production to 40,000 ounces annually by late 2007."
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Certain statements contained herein are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.