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Quote from announcement of 24/04/08:

Mr Brian Johnson, Executive Chairman of EnviroGold Limited advises that through recent discussions with its Bankers it has become clear that due to the current financial climate it will take longer than originally anticipated to close the financing for its 70% owned Las Lagunas Gold Project in the Dominican Republic.

The Company is still working with Standard Bank to pull the financing together and progress to drawdown. Provided that progress remains on track and a positive outcome is achieved in the next six weeks, no construction time will be lost.

Nevertheless, as a contingency, the Company will investigate other sources of financing including issuing either convertible notes or bonds to fund the project.

In any event, the Company has commenced negotiations to increase its shareholding in the Dominican project. Negotiations are also underway to purchase a 2.5% royalty stream to be paid by EnviroGold as vendor consideration for the purchase two years ago of a 20% shareholding in Las Lagunas Limited, the project developer.


------- Not the news we were looking for but the market was most probably already reflecting the lack of news re Project Finance -- but increasing it holding is hardly the action of a company that doesn’t believe strongly in the project.


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To quote from the December 2007 quarterly:

Project Finance
Project finance negotiations progressed during the quarter to the point where EnviroGold has since mandated Standard Bank Plc out of London to provide US$23m of project finance and a cost over run facility of US$2m.
Provision of the facilities is subject to an agreement of loan documentation, satisfaction of conditions precedent and the Banks internal approvals. Drawdown is expected to commence in April 2008.

------ So the difficulty with finance is obviously the main cause of the share price weakness. As I understand it they originally hoped to complete the financing in the Dec 07 quarter ---- and then in the March 08 quarter --- and now in the June.

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They easily raised $16 million @ 16 cents in October 07.
It is a pity in hindsight that they didn’t raise more while the market was so enthusiastic.

We may just have to accept that these are the trials and tribulations of a start up company.

With the advantage of hindsight we would do a lot of things differently.

I wouldn’t be in there with my holding at 15.5 cents if I knew I would be able to pick them up at 10. Such is life I suppose.

I still like them. They seem like an incredible opportunity but obviously the banks and market have reservations.

In todays market $23 million seems such a small amount of money. Banks lend $2 and $3 million for non productive assets such as houses. Las Lagunas alone is said to return well in excess of $10 million per year.

Anyway folks I am still holding and hoping.