Sino Gold Limited and Gold Fields Limited have formed a major new strategic alliance, combining Sino Gold"s proven and recognised operational, development and business capabilities in China with the technical, financial and human resources expertise of Gold Fields, the world"s fourth largest gold company.

The strategic alliance will introduce Gold Fields as the largest shareholder in Sino Gold through the placement of 6.5 million ordinary shares, at a price of $5.58 per share, taking Gold Fields' total shareholding in Sino Gold to 27,708,020 million shares or 17.4% of the company's expanded total issued share capital;

The alliance will create a dedicated new, 50:50 jointly-owned and funded group to target and explore China for projects that meet Gold Fields' benchmark "rule of fives" criteria: resources of at least 5 million ounces of gold and production capacity of approximately 500,000 ounces of gold per year.

Gold Fields' existing exploration assets and personnel in China into Sino gold which, in terms of the strategic alliance, will in future conduct all of the Gold Fields exploration activity in China and provide Sino Gold access to the technical expertise and training programs of Gold Fields.

Gold Fields chief executive officer Ian Cockerill says the strategic alliance represents the next logical step in the developing relationship between Gold Fields and Sino Gold, its long standing partner in China.

"It provides Gold Fields with the ability to strengthen and accelerate its exploration efforts for large, high quality, long life assets in a highly prospective region in the world," Ian Cockerill says.

The strategic alliance will explore primarily for porphyry, high-sulphidation epithermal or sediment-hosted disseminated orogenic-style gold mineralisation. These styles of mineralisation are not currently the focus of Sino Gold's exploration program in China.

Sino Gold chief executive officer Jake Klein says, "We are very pleased that a company of Gold Fields' calibre has chosen Sino gold as its exploration and development vehicle in China.

"The combination of Gold Fields, the world's fourth largest gold producer and Sino Gold, the largest foreign gold producer in China, is both compelling and powerful," Jake Klein says.

"The exploration focus introduced through this alliance is a significant addition to and separate from Sino Gold's current exploration program.

"This strategic alliance will provide additional funding and expertise to further accelerate our exploration in order to discover and develop multi-million ounce deposits in China, in styles of deposits that Sino gold has to date not been targeting.

"The strategic alliance, combined with Sino Gold's upcoming secondary listing on the Hong Kong Stock Exchange, will provide the ideal platform to grow and develop Sino gold into China's leading gold company," Jake Klein says.