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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the period of September 10, 1998 Commission File Number: 1-9025
VISTA GOLD CORP.
(Name of Registrant)
Suite 3000
370 Seventeenth Street
Denver, Colorado 80202
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F
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Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the SEC
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate the file number assigned to the registrant in
connection with Rule 12g3-2(b): Not applicable.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
VISTA GOLD CORP.
Date: September 14, 1998 By: Roger L. Smith
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Roger L. Smith
Vice President Finance
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EXHIBIT INDEX
Exhibit Description of Exhibit
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99.1 Press release dated September 10, 1998, Company announces
plans to acquire the Mineral Ridge Mine
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EXHIBIT 99.1
VISTA PLANS TO ACQUIRE MINERAL RIDGE MINE
DENVER, COLORADO, SEPTEMBER 10, 1998 - Vista Gold Corp. ("Vista") is pleased to
announce that its Board of Directors has approved, in principle, the acquisition
of Mineral Ridge Resources Inc. ("MRRI") from Cornucopia Resources Ltd.
("Cornucopia"). Vista's board approval is contingent upon the completion of due
diligence, finalizing definitive agreements with the major creditors of MRRI and
receipt of all required regulatory approvals. Vista will acquire all of the
shares of MRRI in consideration for common shares of Vista valued at US$250,000
and Vista subscribing to a US$250,000 private placement in Cornucopia. A letter
agreement confirming the intent of the two companies was signed today.
The Mineral Ridge mine, the only asset of MRRI, is located near the town of
Silver Peak, approximately 35 miles southwest of Tonopah, Nevada. The Mineral
Ridge plant and facilities were completed in May 1997 for a cost of
approximately US$17 million. The first gold was poured on June 20, 1997, but for
a number of reasons, the project failed to reach commercial production. In
December 1997, mining operations were suspended at the project. Vista has
completed a preliminary technical review of the project and believes that, with
appropriate modifications to the mine plan, crushing plant and an enhanced water
supply, the mine can be put back into production at a profitable level. Vista
will move a portion of its mining fleet from its Hycroft mine, including four
150-ton trucks and a 23-cubic-yard hydraulic shovel, to the Mineral Ridge
property. At the time of closure, Mineral Ridge had a reserve of approximately
three million tons at a grade of 0.066 ounces per ton containing 199,500 ounces
of gold. Vista will complete a definitive mine plan and ore reserve estimate as
part of its due diligence, but preliminary estimates employing the lower cost
structure of the larger mining equipment indicate that the proven and probable
reserves could be increased to 230,000 - 250,000 ounces of gold. A preliminary
production plan has been completed which projects approximately 180,000 ounces
of gold production over the next four years, at an average total cash cost of
US$220 per ounce. Production for 1999 is projected at 58,000 ounces of gold.
Vista has reached a preliminary agreement and signed an indicative term sheet
concerning the mine debt financing facility, subject to credit committee
approval, with Dresdner Bank, MRRI's principal creditor. The outstanding balance
of this loan, including accrued interest, is approximately US$13.3 million. The
principal terms of the agreement call for the loan to be repaid out of 70
percent of the cash flow of the project (leaving 30 percent to Vista) after
Vista has deducted management fees. The loan will be secured by the assets of
MRRI and the approximately US$5 million worth of mining equipment which Vista
will use to mine the project. As part of the agreement, Vista will be able to
liquidate approximately 58,000 ounces of forward gold hedges to realize
approximately US$3.5 million to be used as working capital and to pay for
capital improvements to the project. In addition, approximately 40,000 ounces of
forward gold hedges, priced at an average price of US$388 per ounce, will be
left in place for gold production in 1999.
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It is expected that due diligence and definitive agreements will be completed by
October 1, 1998. Following positive due diligence, Vista will mobilize mining
equipment and staff immediately to commence mine production this year, with the
first gold expected to be poured towards the end of 1998.
Mike Richings, President and CEO, said of the transaction, "We are able to
acquire this property as a direct result of our demonstrated ability to mine and
operate low cost gold operations. The Mineral Ridge deposit is significantly
higher grade than the Hycroft mine, and that is reflected in lower projected
cash costs. The cash flow from the project, together with the significant
exploration upside on the property, makes it an excellent acquisition for us.
With a concerted exploration program, we hope to increase the reserves over the
next couple of years to 500,000 ounces."
Vista Gold Corp. is an international gold mining, development and exploration
company based in Denver, Colorado. Its holdings include the Hycroft mine in
Nevada, development projects in Bolivia and exploration projects in North and
South America.
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The statements that are not historical facts are forward-looking statements
involving known and unknown risks and uncertainties that could cause actual
results to vary materially from the targeted results. Such risks and
uncertainties include those described in the Company's Form 20-F as amended.
For further information, please contact Investor Relations at (303) 629-2450.
