Canadian company Unigold promotes its Dominican Republic business as what it’s all about, on its website at http://www.unigoldinc.com
In its annual report, the company highlights that it began operations on 1 January 2003 and was established for the primary purpose of exploring, discovering and developing gold deposits on its 81,000 hectares of property held in Neita and Sabaneta, along the Haitian border. The company reported on 23 May 2003 that its aim is to find a gold deposit equivalent in size to the outstanding Pueblo Viejo gold mine (a Placer Dome concession), also in the Dominican Republic, which has produced over 5 million ounces of the precious metal since 1975 and contains an additional geological inventory of 30 million ounces of gold. Unigold explains on its website that it has no current operating income or cash flow, and its existence depends solely on its ability to obtain additional required financing.
Regardless of its admittedly weak financial position, Unigold announced on 14 November that the Dominican government had signed a letter of intent regarding its acquisition of 100% of future revenues up to US$175 million in the abovementioned Placer Dome Pueblo Viejo concession. The future revenues would have been produced for the government given the agreed upon 3.2% “net smelter return” royalty on the Pueblo Viejo gold deposit earlier agreed upon with Placer Dome, another Canadian company. Local geologists and former Senate president Ramon Alburquerque have openly criticized the original Placer Dome deal signed by the Dominican government as being detrimental to national interests. Now the government seems to have gone one step further, promising to split the yet-to-be-had revenue 40/60 with the vastly unknown Unigold. In return, Unigold accepts to make payments to the government in the aggregate amount of US$42.725 million. The deal calls for US$21.3 million to be paid in cash upon the signing of a formal agreement between Unigold and the government, with the remaining 50% (or US$21.3 million) upon Placer Dome’s announcement of a start date for commercial production. According to the Unigold press release, the formal agreement is expected to be signed by the end of 2003. Hoy newspaper reports, however, that Placer Dome has yet to set a date for the start of exploitation of its concession, which was also pending on the results of a feasibility study, as the site is still under evaluation by Placer Dome.
On its website, Unigold mentions they will provide funds to the unknown Fundacion Cacique Inc, described as a non-profit organization formed to support and assist the Dominican people. Unigold commits to contribute US$5.58 million to the foundation, to be provided as US$2.58 million cash plus 500,000 shares of Unigold stock.
This deal had not been made public in the Dominican Republic prior to the online publication of the document by the Canadian company carried in Hoy newspaper today. See http://www.unigoldinc.com/pressrelease200313.html