break out soon, page-3

break out soon-soon moved forward
ASX ANNOUNCEMENT
SMC Gold Limited

8 December 2004
$5 MILLION FUNDING FOR CHILEAN EXPANSION TO 60,000 OUNCES GOLD
EQUIVALENT
SMC Gold Limited is pleased to announce that it has arranged A$5million in funding to
accelerate expansion of the Company’s Chilean operations.
In advance of a fully
underwritten, 2 for 9 non-renounceable rights issue at 9 cents per share, SMC will
receive A$2.5million in short-term funds on 9 December 2004 and A$2.5million on 20
December 2004 from Claymore Capital.
The company will repay the funds from the proceeds of a fully underwritten rights issue
expected to be announced and the prospectus lodged on 23 December 2004.
The
company anticipates a record date of 6 January 2005. A final timetable will be included
in the prospectus.
Claymore Capital will lead manage and underwrite the rights issue.
The funds will be used to advance the Chilean operations by bringing the Punitaqui
plant and mines up to an annualised production rate of approximately 60,000 ounces
gold equivalent by mid 2005. Specifically, the funds will be invested in:
Increasing plant capacity by 50% to 1500 tonnes per day
Improving plant availability
Increasing metal recovery rates by up to15%
Significantly improving concentrate grade
Planned drilling programs on the Cinabrio, Dalmacia and Diatrema properties
with the aim of significantly improving SMC’s mineral resources in Chile. The
company expects the Cinabrio program to commence before the end of January
2005. The drilling programs for Dalmacia and Diatrema should commence
around March 2005.
Based on management’s current working assumptions, the process plant modifications
have a payback period of approximately 6 months. To rely on cashflow from operations
would have delayed these process plant improvements by some 12-18 months and in
the light of the clear financial benefits the Board believes that this funding represents an
extraordinary opportunity to accelerate the Company’s expansion strategy in Chile. It is
anticipated that the process plant modifications will be completed by May 2005 by which
time the company anticipates that the Chilean operations will be generating pre-tax
cashflow from operations of in excess of A$1 million per month.
In anticipation of a successful outcome from the drilling programs, the Company is
planning to commission a feasibility study during Q4 2005 to consider expansion of the
plant’s capacity to 3,000 tonnes per day (approximately 120,000 oz per annum gold
equivalent).
The Directors consider that the use of funds will put the Company in a strong position to
realise its strategic goals and that the fundraising is therefore in the best interests of the
Company and its Shareholders.
The rights issue Prospectus and Entitlement form will be despatched to shareholders on
7 January 2005.
Rob Kidd
Managing Director
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Yes a little disappointing guys but at least the new capital will allow SMO to ramp up its production early,

We just need to wait a little longer and buy on the dips??
any body work out how many shares extra