Explanatory Statement

RNS Number:0759O
Ballarat Goldfields N.L.
18 December 2006

BALLARAT GOLDFIELDS NL
ASX and Media release: 18 December 2006


              Ballarat Goldfields and Lihir Gold Proposed Merger -

                        Release of Explanatory Statement


Ballarat Goldfields N.L. (Ballarat Goldfields) is pleased to announce that on
Friday 15 December 2006 the Supreme Court of Victoria made orders convening a
meeting of Ballarat Goldfields shareholders (Scheme Meeting) to consider the
Scheme of Arrangement for the company's proposed merger with Lihir Gold Limited
(Lihir), that was announced on 17 October 2006.


Explanatory Statement and Scheme Meeting

ASIC has subsequently registered the Explanatory Statement for this purpose and
a copy follows. This will be mailed to Ballarat Goldfields shareholders by 12
January 2007 to provide them with relevant information necessary to determine
whether to vote in favour of the merger at the Scheme Meeting that will take
place on 12 February 2007 in Ballarat.


The Explanatory Statement is also available on the Ballarat Goldfields website
at

www.ballarat-goldfields.com.au


Directors' Recommendation

The Directors of Ballarat Goldfields unanimously recommend that, in the absence
of a superior proposal, Ballarat Goldfields shareholders vote in favour of the
proposed merger as they believe it will deliver significant value to Ballarat
Goldfields shareholders. Ballarat Goldfields Directors (all of whom hold
Ballarat Goldfields shares) intend to vote their shares, and any proxies cast at
their discretion, in favour of the merger.


Scheme Consideration

Under the terms of the Scheme, Lihir will acquire all of the shares in Ballarat
Goldfields with Ballarat Goldfields shareholders receiving 5 New Lihir Shares
for every 54 Ballarat Goldfields shares held.


Independent Expert

An independent expert's report from Grant Samuel & Associates Pty Ltd (Grant
Samuel) has assessed the proposed merger and has concluded that, on balance, the
Scheme is in the best interests of Ballarat Goldfields shareholders.


Next Steps

Ballarat Goldfields shareholders will be asked to vote at the Scheme Meeting,
which will take place at 10.00am on 12 February 2007 at the Ballarat Lodge, 613
Main Road Ballarat.



If shareholders vote in favour of the merger, Ballarat Goldfields intends to
seek court approval at a second hearing of the Supreme Court of Victoria, which
is expected to occur on or about 23 February 2007. Subject to Court approval at
this hearing, implementation of the Scheme would occur on or about 5 March 2007.






For further information, please visit our website www.ballarat-goldfields.com.au
or contact Joel Forwood, Manager Corporate and Markets, on 03 5327 1111



                      This information is provided by RNS
            The company news service from the London Stock Exchange

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