PNG Gold and New Guinea Gold Merger Update

PNG Gold and New Guinea Gold jointly announce that they have executed a binding Arrangement Agreement whereby PNG Gold will acquire all the shares of New Guinegold mining most important equipmenta Gold by way of Plan of Arrangement at an exchange ratio of one NGG share for 0.125 PNG Gold shares. In addition, PNG Gold has agreed to assist NGG with the critical and immediate cash shortfall announced in NGG's press release of February 29 by lending New Guinea Gold up to $2.5 million, in advance of the Arrangement being completed.

The Arrangement is presently expected to close shortly after April 12th 2012, depending on the timing of satisfaction of certain conditions precedent. The NGG Shareholders meeting to consider the Arrangement will be held on April 12th, 2012. The Arrangement must be completed by May 31, 2012 or either party will have the right to terminate the Arrangement Agreement. The reduction in the previously announced Exchange Ratio of one NGG share for 0.175 PNG Gold shares was necessary to reflect the increased risk now associated with the Arrangement due to the interruption of operations at...