No delight for Frontier Pacific in Turkish mine legal decision

Vancouver – A Turkish court decision may cause disruption to operations at Frontier Pacific Mining’s (FRP-V) soon to be acquired Ovacik gold mine in the western part of the country.

The company has an agreement to purchase the mine from Newmont (NEM-N) for US$30 million plus additional deferred payments of up to US$14 million (TNM, July 2/04), who were notified of the verdict from the Izmir 3rd Administration Court, nullifying its trial operating permit. The decision, once implemented, may require a halt to milling at the country’s first gold mine.

Newmont’s Turkish subsidiary, Autin Investments, can appeal the decision and anticipates the interruption to only be temporary.

Both Frontier Pacific and Newmont are cooperating to conclude the agreement, with the latter extending the August 15th sale date to allow for resolution of these legal issues.

Frontier Pacific is moving forward on its final technical and financial due diligence for the transaction.Ovacik has operated since 2001, employing over 400 Turkish workers and consultants.

Investors sold off on the news pushing down the issue over 10% to 49.5, on volume of 256,000 shares at presstime. The company reports 32 million shares outstanding.