Emerging Capital Partners Makes Investment in Central African Gold

WASHINGTON, Jan. 31 /PRNewswire-FirstCall/ -- Emerging Capital Partners (ECP), an international private equity firm focused on investing across the African continent, today announced a U.S. $15.2 million investment in Central African Gold (CAG) (AIM: CAN). CAG is an emerging gold producer with operations in Ghana and Zimbabwe along with advanced exploration properties in Mali and Botswana. Since March 2006, the company has increased its total gold resources to approximately 5.6 million ounces within their highly prospective areas of operation through both acquisition and exploration activity. ECP's investment, which makes it the largest single shareholder, was made as a cornerstone investor in a private placement of shares.

The African mining sector is undergoing significant change as a result of consolidation in the industry, under-exploration and under-development during the past several decades, and current strong commodity prices buoyed by demand from China and India. These factors are creating opportunities for focused junior mining companies to acquire mature, producing properties from majors and to add value through cost effective mine development and focused exploration programs. CAG exemplified this dynamic by acquiring the Bibiani Gold Mine from Anglo Ashanti where it has been able to quadruple underground gold reserves to approximately 1 million ounces.

"ECP views CAG as an excellent investment vehicle in the African natural resources sector," said Tom Gibian, chief executive officer of ECP. "CAG's management team has depth of experience in both gold exploration and mine development within Africa. The combination of strong management, projected acceleration in gold production, and the current positive market conditions for gold give CAG the makings of a high-growth company."

"ECP's investment in the short term will support the full-scale start up of the underground mining operation at the Bibiani gold mine in Ghana, as well as further exploration, both within the Bibiani concession and in Mali where the company has already established over 500,000 ounces of gold resources," said Navaid Burney, ECP managing director. "In the longer term, we intend to help the company develop its portfolio of exploration and production assets and achieve its objective of becoming a leading mid-tier gold producer by introducing potential opportunities for growth and by supporting future acquisitions."

ECP's natural resources investments have spanned both the mining and oil and gas sectors. CAG is ECP's fourth investment in the mining sector preceded by investments in OSEAD Maroc Mining, Mineral Deposits Limited and Anvil Mining. ECP's oil and gas investments have included Artumas Group, PanAfrican Energy, Petroci/Foxtrot and Ocean & Oil Investments. While Africa holds vast quantities of the world's natural resources, the continent has traditionally had low production relative to global supply, despite growing international demand. Expected continued strong international demand combined with Africa's richness in natural resources creates significant opportunity for well-managed companies in the sector to expand.

The investment in CAG was made through ECP's $523 million EMP Africa Fund II. The fund was established in December 2005 to capitalize on the numerous investment opportunities throughout Africa in sectors such as telecom, natural resources, financial services, agribusiness, transportation, and power and water.

ABOUT ECP

Emerging Capital Partners (ECP) is the first private equity firm to raise more than USD $1.2 billion to invest in companies across the African continent. The ECP team has a seven-year track record of pan-African investing through five successful funds. The firm's investment strategy is focused on delivering consistently above-market returns to investors that are uncorrelated to the U.S. and other global economies. For more information, please see www.ecpinvestments.com.