GOLD HILL, Nev., May 2, 2006 (PRIMEZONE) -- GoldSpring, Inc. (OTCBB:GSPG) announced today that a group of its existing investors has committed financing in the amount of $1.8 million. The Company expects to close the transaction in the next 90 days, subject to completion of certain closing conditions. Upon closing, the funds will be deployed to expand the Company's Plum Mine operation in northern Nevada. Specifically, the Company plans to take over the mining operations from its contract miner and has committed $500,000 to conduct further exploration at the Plum property. The Company estimates that the transition to in-house mining operations will reduce gold production costs by approximately $40 per ounce, bringing the cash cost below $350 per ounce of gold.
Commenting on the financing pledge, GoldSpring President and CEO Rob Faber said, "This round of financing will be deployed exclusively toward advancing operations at the Plum Mine. The funding will allow our Company to transition to in-house mining operations, which we anticipate will provide both cost savings and increased efficiency." Additionally, GoldSpring announced previously that it plans to launch an exploration program on its Plum Mine property during the summer of 2006. Faber added, "Our Company is committed to expanding the footprint and mine life of the Plum Project. This financing will provide the funds for our 2006 exploration program, which we believe will result in increased reserves at the Plum property."
GoldSpring, Inc. is a North American precious metals mining company with an operating gold and silver mine in northern Nevada. The Company was formed in mid-2003 and acquired the Plum Mine property in November 2003. In the Company's three years in existence, it has accomplished the following: secured permits, built an infrastructure and brought the Plum Mine project into production. During 2005, the Company sought to expand its business even further by acquiring additional properties around the Plum project in northern Nevada, expanding its footprint and creating additional opportunities for exploration. GoldSpring is an emerging company, looking to continued to expand upon its foundation and success through the acquisition of other mineral properties in North America which have reserves and exploration potential that can be efficiently put into near-term production. The Company's objectives are to increase production and reserves through exploration and acquisitions and expand its footprint at the Plum mine, thereby maximizing Company cash flow and shareholder value.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in this communication (as well as information included in oral statements or other written statements made or to be made by GoldSpring) contains statements that are "forward-looking," as defined in Section 21E of the Securities Exchange Act, such as statements relating to the future anticipated direction of the high technology and energy industries, plans for future expansion, various business development activities, planned capital expenditures, future funding sources, anticipated sales growth, mining capability and potential contracts. Such forward-looking information involves important risks and uncertainties, which include the risk factors disclosed in our most recent Form 10-KSB filed on April 15, 2005, that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of GoldSpring. These risks and uncertainties include, but are not limited to, those relating to development and expansion activities, dependence on existing management, financial activities, domestic and global economic conditions, changes in federal or state tax laws and market competition factors. These and other factors, which could cause actual results to differ materially, are discussed in more detail in GoldSpring's filings with the Securities and Exchange Commission. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. We assume no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.