Thistle announces Results for the Third Quarter ended September 30, 2007

    TORONTO, Nov. 29 /CNW/ - Thistle Mining Inc. (AIM: TMG)


    Thistle Mining Inc. ("Thistle" or the "Company") (AIM: TMG) wishes to
announce that the Company's unaudited Consolidated Financial Statements and
Managements Discussion and Analysis ("MD&A") for the nine month period ended
September 30, 2007 will be filed on SEDAR today. All dollar references in this
announcement are in US $. A full copy of the Company's 2007 third quarter
report can be obtained from the Company's website

    Sale of President Steyn Gold Mines (Free State) (Pty) Ltd ("PSGM")

    On October 29, 2007, Thistle and Pamodzi Gold Limited ("Pamodzi") (JSE:
PZG) entered into a Sale of Shares and Claims Agreement ("SSCA") for the sale
to Pamodzi of Thistle's direct and indirect interests in PSGM (the "Sale
Transaction"). Under the terms of the SSCA, the consideration payable by
Pamodzi to Thistle will be ZAR240 million (subject to certain adjustments)
(the "Purchase Consideration") and will be satisfied through the payment of
(i) ZAR100 million (subject to certain adjustments and conditional upon a
placement of ordinary shares of Pamodzi (the "Pamodzi Shares"), failing which
Pamodzi will allot and issue Pamodzi Shares to Thistle at a 10% discount to
the volume weighted average trading price of the Pamodzi Shares on the JSE
over the 30 trading days prior to December 1, 2007) (the "Intended Cash
Consideration") and (ii) ZAR140 million (the "Participating Loan
Consideration") (subject to certain adjustments) applied as a loan, advanced
by Thistle to a special purpose vehicle ("SPV") wholly owned by Pamodzi
Resources (Proprietary) Limited ("Pamodzi Resources"), which indirectly owns
37.9% of Pamodzi.
    The Purchase Consideration will be adjusted by the difference between
PSGM's working capital as at June 30, 2007 and its working capital as at the
December 1, 2007 (the "Effective Date"), subtracted by one half of the
outstanding principal amount of the loans advanced to PSGM by Casten Holdings
Limited ("Casten") and MC Resources Limited ("MC") (who are major creditors
and shareholders of Thistle each owning 35% of the outstanding shares of
Thistle) from September 26, 2007 to the Effective Date ("Working Capital
Loans"), subtracted by all the interest and fees on the Working Capital Loans,
subtracted by the reduction in the value of long term assets less long term
liabilities, as defined in the SSCA, not undertaken in the ordinary course of
business. At this stage an adjustment downwards of approximately ZAR50 million
is expected.
    Of the Intended Cash Consideration, as adjusted, ZAR2 million will be
paid to Iningi Investments 167 (Proprietary) Limited ("Iningi") pursuant to
the agreement between Mindserv (Proprietary) Limited ("Mindserv"), a
wholly-owned subsidiary of Thistle, and Iningi, by which Mindserv will acquire
Iningi's 15% interest in PSGM prior to the Sale Transaction.
    Completion of the Sale Transaction is conditional on various matters,
including approval by the South African competition authorities (which
approval was obtained on November 9, 2007) and any applicable regulatory and
South African exchange control approvals and receipt of shareholder approval
by the shareholders of each of Thistle and Pamodzi. In addition for the Sale
Transaction to be completed, production at PSGM must exceed 340 kg of gold in
November 2007. In the event that Pamodzi withdraws from the Sale Transaction,
it has agreed to pay a break fee of ZAR5 million to Thistle, subject to
certain limited conditions.
    The annual and special meeting of the shareholders to be held on December
13, 2007 (the "Meeting"), will, amongst other matters, consider the proposed
sale of PSGM. The Sale Transaction will require approval by two thirds of the
votes cast by Thistle shareholders at the Meeting. Pamodzi has received
assurances from MC Resources Limited and Casten Holdings Limited, each owning
35% of the outstanding shares of Thistle, of their intention to vote for the
Sale Transaction. Pamodzi's shareholder meeting to approve the Sale
Transaction is expected to be held on or about December 27, 2007 in
Johannesburg, South Africa. The Sale Transaction will require approval by a
majority of the votes cast by Pamodzi shareholders at the meeting. Thistle has
received assurances from Pamodzi Resources, through two of its subsidiaries
(which collectively own 37.9% of the outstanding Pamodzi Shares), of its
intention to vote for the Sale Transaction. Assuming the shareholders of
Pamodzi and Thistle approve the Sale Transaction and all other conditions to
the completion are satisfied or waived, Thistle expects that the earliest the
Sale Transaction will be completed is December 27, 2007 ("Completion Date").

    Investment Strategy

    As the Sale Transaction will divest Thistle of all or substantially all
of its active business activities, under the AIM Rules for companies, Thistle
will, upon completion of the Sale Transaction, be treated as an "investing
company". As a result, it will be required to complete a reverse takeover or
implement its own investing strategy to the satisfaction of the LSE prior to
November 22, 2008. The Thistle Board has resolved that, of the options
available to Thistle moving forward, Thistle should not be delisted from AIM,
wound down or become a passive investor and instead should be used to develop
business opportunities that may be available to it, including any that are
introduced to it by its two major shareholders, Casten and MC. Accordingly at
the Meeting, Shareholders will also be asked, if the Sale Resolution is
approved, to consider and approve Thistle's proposed investment strategy as
set out in this MD&A under the section "Proposed Investment Strategy".

    Suspension of shares to trading on AIM

    Following the deterioration in the financial condition of PSGM and the
uncertainty relating to Thistle's financial situation, on September 24, 2007
the Thistle Board requested the suspension of trading in the Thistle Shares on
AIM. A lifting of this suspension is conditional upon Thistle demonstrating to
LSE its financial viability, which remains uncertain at this time.

    Consent Agreement and Receipt and Acknowledgement Deed

    Thistle, MC, Casten, CGA Mining Limited ("CGA"), Central Asia Gold
Limited ("Central Asia") and Toowong Mining B.V. ("Toowong") have entered into
a consent agreement dated October 16, 2007 (the "Consent Agreement"). Pursuant
to the Consent Agreement, CGA and Central Asia have consented to the transfer
by Thistle to MC and Casten of the Toowong Shares (directly or indirectly) and
the obligations to pay the deferred consideration under the SPA to Thistle
have been terminated and Central Asia has agreed to pay a reduced amount of
$4.5 million to MC and Casten.
    In addition Central Asia and CGA have provided a full release to Thistle,
its directors and officers and all other parties involved in the sale of the
Masbate Project from and in respect of all existing or future claims in
connection with the SPA and the acquisition by Central Asia of the interests
of Thistle in the Masbate gold mine pursuant thereto.
    Subsequent to the Consent Agreement, MC, Casten, Thistle and PSGM have
entered into a receipts and acknowledgement deed dated October 22, 2007 (the
"Deed") under which in return for the agreement by Thistle to transfer its
(direct or indirect) interest in the Toowong Shares to MC and Casten and to
terminate all of its interest in, and not to claim payment of, the deferred
consideration, MC and Casten have acknowledged payment by Thistle, and the
reduction and set-off against the indebtedness owed by Thistle to MC and
Casten, of $42,301,781. The transfer was completed on October 26, 2007 and as
at October 31, 2007 the remaining Indebtedness is estimated at approximately
$22.3 million.
    In addition to being major creditors of Thistle, MC and Casten each own
35% of the outstanding shares of Thistle and as a result are each a "related
party" of Thistle for the purposes of Ontario Securities Commission Rule
61-501 - Insider Bids, Issuer Bids, Business Combination and Related Party
Transactions ("Rule 61-501"). Accordingly, the completion of certain of the
transactions contemplated by the Consent Agreement including the transfer of
the Toowong Shares to MC and Casten and the reduction of, and set-off against,
the indebtedness owed by Thistle to MC and Casten under the terms of the Deed,
will constitute a "related party transaction" for the purposes of Rule 61-501.
As noted in the press releases announcing the financing arrangements between
Thistle and Casten and MC, the Thistle Board concluded that Thistle could rely
on the "financial hardship" exemption described in Rule 61-501 from the formal
valuation and minority shareholder approval requirements of Rule 61-501 and
that such transactions were fair and reasonable in the circumstances of
Thistle. In reaching these conclusions, the Thistle Board consulted with
outside advisors, including Grant Thornton Corporate Finance, its nominated
advisor, which took into account the Thistle Board's commercial assessment of
the arrangements.

    Going Concern

    Having reviewed the cash flow forecasts of the Company and its
subsidiaries until the completion of the Sale Transaction, the Company and its
subsidiaries will not be able to meet its obligations as they fall due absent
additional funding by MC and Casten. Subsequent to the Sale Transaction, the
Company is expected to meet its corporate overheads and partially reduce the
indebtedness owed by Thistle to MC and Casten ("Indebtedness"), which is at
the option of MC and Casten immediately due and payable, should the Intended
Cash Consideration be made in cash. Following the Sale Transaction Thistle's
only material asset will be its interest in the Participating Loan. There has
been no agreement or understanding reached with Casten and MC regarding the
assignment of the Participating Loan for a reduction in the Indebtedness. As
Thistle will not have the cash necessary to meet the remaining indebtedness
owed by Thistle to Casten and MC, Thistle will be required to make
arrangements with these creditors going forward.
    Should the completion of the Sale Transaction take place, it is
management's belief that existing cash resources, the sale of PSGM, cash
provided by MC and Casten should they elect to meet future additional funding
requests and the willingness of MC and Casten to enter into an arrangement
regarding the assignment of the Participating Loan for a reduction in the
Indebtedness, will be sufficient to meet the Company's anticipated
requirements. Accordingly the financial statements have been prepared on the
basis of accounting policies applicable to a going concern.
    Should MC and Casten decline to advance funds in respect of future
additional funding requests and/or the proposed sale of PSGM not be successful
and/or Casten and MC willingness to enter into arrangement regarding the
assignment of the Participating Loan for a reduction in the Indebtedness,
there is a material uncertainty which would cast doubt on the ability of the
Company and its subsidiaries to continue as going concerns and, therefore,
that they may be unable to realise their assets and discharge their
liabilities in the normal course of business.

    Highlights for the quarter ending September 30, 2007 and subsequent

                                  Q3 2007    Q3 2006    9 months    9 months
                                    Fresh      Fresh        2007        2006
                                    Start      Start       Fresh       Fresh
                                                           Start       Start
    Sales ($ millions)               21.3       25.7        61.3        68.9
    Net earnings / (loss)
    before discontinued
    operations ($ millions)          (9.5)       0.8       (19.9)       (4.0)
    Net earnings / (loss)
    per share before
    operations ($)                  (0.21)      0.02       (0.43)      (0.09)
    Net earnings / (loss)
    ($ millions)                     (9.6)       0.7         3.5        (4.3)
    Earnings / (loss)
    per share ($)                   (0.21)      0.01        0.08       (0.09)
    Cash generated by
    (used in) continuing
    operations ($ millions)          (2.0)      (0.1)      (10.5)       (3.0)
    Gold sold (000's oz)               31         41          91         112
    Cash costs ($/oz)                 720        518         679         530
    Total costs ($/oz)                788        542         733         567

    -   On January 31, 2007, the Company and CGA Mining Limited ("CGA")
        (ASX: CGX and TSX: CGA) entered into a Sale and Purchase Agreement
        ("SPA") for the sale to a wholly-owned subsidiary of CGA (the
        "Purchaser") of 100% of Thistle's shareholding in PGO, a wholly-owned
        subsidiary of the Company, and its other interests in the Masbate
        Project. The transaction closed on March 19, 2007. Accordingly the
        Masbate Project has been classified as a discontinued operation and
        its financial results are separately disclosed with comparatives
        restated as appropriate. The gain on the sale of the Company's
        interest in the Masbate Project amounted to $23.5 million or $0.51
        per share. Following this transaction, the Company's total assets
        exceeded its total liabilities by $1.6 million.

    -   Of the US$51 million total consideration payable under the SPA,
        US$21 million was paid in ordinary shares of CGA ("CGA Shares"). At
        the agreed issue price of the CGA Shares of A$0.65 per CGA Share and
        exchange rate of A$:US$ 1.2686, Thistle received 40,985,538 CGA
        Shares an approximate 25.4% interest in CGA. In terms of Canadian
        GAAP this is considered an investment subject to significant
        influence and is accounted for using the equity method. Under the
        equity method, the original cost of the shares is adjusted for the
        Company's share of post-acquisition earnings or losses less

    -   On March 20, 2007, the Company paid $26.7 million of the purchase
        consideration to MC and Casten as part payment of short term debt
        owing. Following this payment, the amount of principal, interest and
        withholding taxes outstanding on April 1, 2007 amounted to
        $54.3 million.

    -   On March 29, 2007 following an unwillingness of MC and Casten to
        defer short term debt and interest due and payable in terms of the
        Memorandum of Agreements entered into on March 28, 2006 and the
        realization that PSGM would not be able to generate sufficient free
        cash flows to allow Thistle to meet its financial obligations,
        Thistle announced that it was in financial hardship and suspended
        trading on the AIM market of the London Stock Exchange Plc pending
        satisfactory resolution of this matter.

    -   On April 11, 2007, Thistle entered into a non-binding memorandum of
        agreement in respect of the restructuring of indebtedness owing by
        Thistle to MC and Casten (the "Memorandum of Agreement"). The
        Memorandum of Agreement contemplated (amongst other matters) the
        transfer of Thistle's (direct or indirect) ownership interest in
        25.4% of the shares in the capital of CGA (the "Toowong Shares") held
        through its wholly owned Dutch subsidiary, Toowong Mining B.V.
        ("Toowong"), to MC and Casten which would result in the reduction of
        Thistle's indebtedness to MC and Casten.

    -   On 11 May 2007, Thistle entered into a debt standstill agreement with
        MC and Casten (the "Standstill Agreement") pursuant to which MC and
        Casten agreed (amongst other matters) that should CGA's consent to
        the transfer of the Toowong Shares to MC and Casten not be obtained
        by August 11, 2007, the arrangements provided for in the Memorandum
        of Agreement would lapse. Following the execution of the Standstill
        Agreement the suspension of the Company's shares to trading on AIM
        was restored on May 22, 2007.

    -   On June 27, 2007, MC and Casten agreed to provide a credit line to
        the Company for the purpose of funding corporate costs including the
        cost of strategic initiatives relating to PSGM and to provide a
        contingency in the event of below forecast performance by PSGM. The
        credit line was contingent on, amongst others, improved performance
        at PSGM for each of the months of July and August 2007 of not less
        than 396 kilograms of gold. Unfortunately this level was not achieved
        and as a result MC and Casten have no obligation to extend any
        further credit and may at their option, declare all amounts owing by
        Thistle to them, including the amounts deferred in terms of the
        Standstill Agreement which is now of no force or effect, to be
        immediately due and payable. At present Thistle has not received any
        notice in this regard. In addition CGA's consent to the transfer of
        the Toowong Shares to MC and Casten was not obtained by August 11,
        2007 and, accordingly, the arrangements provided for in the
        Memorandum of Agreement lapsed.

    -   Cash flow used in continuing operations was $2.0 million in the third
        quarter of 2007 compared to $0.1 million used in the third quarter of
        2006. Despite the increase in the gold price realized for the third
        quarter of 2007 compared to the third quarter 2006, the decrease in
        ounces sold and the increase in costs relative to the same period in
        2006 resulted in an increase in cash used in continuing operations.

    -   Investment in property, plant and equipment of continuing operations,
        decreased in the third quarter of 2007 relative to the third quarter
        of 2006. Total funds invested in continuing operations amounted to
        $1.4 million in the third quarter of 2007 and $2.2 million in the
        third quarter of 2006. The total invested in property, plant and
        equipment of continuing operations for the first nine months of 2007
        decreased to $4.4 million compared to $4.5 million in the
        corresponding period for 2006.

    -   Additional financing of $1.19 million was raised in the third quarter
        of 2007 from MC and Casten. Of this amount $0.59 million was advanced
        to Thistle to meet corporate overheads and $0.6 million was advanced
        directly to PSGM as part of the Working Capital Loans which Pamodzi
        will procure that PSGM will repay after the completion of the Sale
        Transaction. In total Casten and MC have advanced $4.94 million to
        the group for the first nine months of 2007 compared to $0.68 million
        in the first nine months of 2006. Of the $4.34 advanced to Thistle,
        $0.7 million was applied to funding a cash deficit at PSGM in the
        first quarter of 2007, with the balance applied to funding the
        Philippine operations and corporate overheads. The $0.6 advanced
        directly to PSGM in the third quarter was applied to funding a cash

    -   The net loss and net loss before discontinued operations for the
        third quarter of 2007 was $9.6 million, or $0.21 per share and
        $9.5 million, or $0.21 per share, respectively, compared to earnings
        of $0.7 million, or $0.01 per share, and $0.8 million, or $0.02 per
        share, in the third quarter of 2006. Net earnings and net loss before
        discontinued operations for the first nine months of 2007 was
        $3.5 million, or $0.08 per share and $19.9 million, or $0.43 per
        share, respectively, compared with the net loss and net loss before
        discontinued operations for the first nine months of 2006 of
        $4.3 million, or $0.09 per share and $4.0 million, or $0.09 per

    -   Gold sold in the third quarter of 2007 was 31,293 oz, a decrease of
        24% compared to the same period in 2006. Production was adversely
        affected by a number of issues including the rehabilitation of a
        seismic event affecting the 32 level haulage at No. 1 shaft, the
        shaft pillar area which was sealed following a fire at No. 2 shaft
        which was extinguished, No. 3 shaft was experiencing difficulty with
        the free flow of ore from two main ore-passes, power failures
        experienced at No. 3 shaft due to a faulty pump which led to the
        flooding of two main power feeder cables and a panel at the national
        electricity supplier substation at No. 2 shaft exploded resulting
        extensive damage to the building and electrical equipment and
        interruptions for the gold plant and No. 2 shaft.

    -   The gold yield from underground sources for the third quarter of 2007
        averaged 5.00 g/tonne compared to an average of 5.57 g/tonne in the
        third quarter of 2006 and 5.70 g/tonne and 5.43 g/tonne for calendar
        years 2006 and 2005 respectively. The drop off in yield reflects the
        lack of flexibility that PSGM has to absorb the production shocks
        experienced in the first, second and third quarters of 2007.

    -   Compared to the third quarter of 2006, PSGM's unit cash(1) costs
        increased by 39% to $720 per ounce and total costs increased by 45%
        to $788 per ounce of gold, respectively. The increase in unit cash
        cost occurred mainly due to reduction in gold sales by 24%,
        expenditure on upgrading electrical infrastructure at Number 3 shaft,
        increases in the cost of labour of 13.8% which took effect at the
        June 2006 month end and the higher winter electricity tariffs for
        June to August 2007.

    -   The Company realized an average price of $676 per ounce of gold in
        the third quarter of 2007, which is US$4 per ounce less than the
        market average spot price of $680 for quarter. The price realized is
        $58 per ounce higher than that realized in the third quarter of 2006.

    -   Gold production at PSGM continues to be challenging due to a lack of
        operational flexibility compounded by infrastructure problems. PSGM's
        gold production in 2007 is anticipated to be approximately
        122,000 oz, at a cash cost and total cost of approximately $685 to
        $695 per oz and $735 to $745 per oz respectively assuming an exchange
        rate of 7.00 ZAR:US $.

    This news release contains forward-looking statements with the meaning of
applicable securities laws including amongst others, statements made or
implied under the headings "Overview", and "Highlights for the quarter ending
September 30, 2007 and subsequent events" above relating to the Company's
objectives, strategies to achieve these objectives, future cash flow and
financing requirements, and similar statements concerning anticipated future
events, results, circumstances, performance or expectations that are not
historical facts. Such forward-looking statements reflect the Company's
current beliefs and are based on information currently available to
management. These statements are not guarantees of future performance and are
based on the Company's estimates and assumptions that are subject to risk and
uncertainties inherent in the business of the Company including those
discussed in the Company's materials filed with the Canadian securities
regulatory authorities from time to time, which could cause the actual results
and performance of the Company to differ materially from the forward-looking
statements contained in this news release. Those risks and uncertainties
include, among other things, risks related to: the mining industry (including
operational risks in exploration development and production; delays or changes
in plans with respect to exploration or development projects or capital
expenditures; the uncertainties involved in the discovery and delineation of
mineral deposits, resources or reserves; the uncertainty of mineral resource
and mineral reserve estimates and the ability to economically exploit mineral
resources and mineral reserves; the uncertainty of estimates and projections
in relation to production, costs and expenses; the uncertainty surrounding the
ability of the Company to obtain all permits, consents and authorizations
required for its operations and activities; competition for the acquisition,
exploration and development of mineral interests; and health and safety and
environmental risks), the risk of gold and other commodity price and foreign
exchange rate fluctuations; the ability of the Company to fund the capital and
operating expenses necessary to achieve the business objectives of the
Company; the uncertainty associated with commercial negotiations and
negotiating with foreign governments; the risks associated with international
business activities; the dependence on key personnel; the ability to access
capital markets; the indebtedness of the Company; and labour relations
matters. Material factors or assumptions that were applied in drawing a
conclusion or making an estimate set out in the forward-looking statements
include that the general economy remains stable, the demand and price of gold
continues to increase and the Rand remains strong against the US$. It is also
assumed that there will be no major disruptions in production including
failure of infrastructure, seismic activity, underground fires and labour
unrest. The Company cautions that this list of factors is not exhaustive.
Although the forward-looking statements contained in this news release are
based upon what the Company believes are reasonable assumptions, there can be
no assurance that actual results will be consistent with these forward-looking
statements. All forward looking statements in this news release are qualified
by these cautionary statements. These forward-looking statements are made as
of the date hereof and the Company, except as required by applicable law,
assumes no obligation to update or revise them to reflect new information or
the occurrence of future events or circumstances.

    (1) Cash cost per ounce sold is not a recognized measure under Canadian
        GAAP. A reconciliation to the cost of sales per ounce is included
        under South African Operations.

For further information:

For further information: Anton Kakavelakis, Group Financial Controller,
+ 27 57 391 9026, or email to; Gerry Beaney or Troy
MacDonald, Grant Thornton Corporate Finance at +44 (0) 207 383 5100

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