Anglo Pacific Group plc ("the Company") announces that it has agreed, subject to contract and due diligence, to provide funding of A$5 million to Mundo Minerals Limited ("Mundo") (ASX: MUN) in the form of a convertible debenture. This will either be convertible into a 3% net smelter royalty ("NSR") on the production from the Torrecillas project in Peru, or be convertible into equity in Mundo at a conversion price of A$0.32, or be repayable.

The funds will be used to increase production at Mundo's Engenho Gold Mine in Brazil to a targeted level of 48,000oz per annum by 2011 and underpin additional project assessment work and a final Feasibility Study on the development of its Torrecillas Gold Project in Peru

Under the terms of the agreement:

• The convertible debenture will expire on 31st December 2012 and will not be repayable until then.
• The Company will have the option to convert into the NSR or Mundo equity at any time prior to the expiry date.
• The Convertible will not be repayable if at any time prior to the expiry date the share price of Mundo trades at a level in excess of A$0.75 per share for a continuous period of not less than 3 months.
• Interest will be payable on the debenture at a rate of 8.5% per annum until conversion or repayment.
• The NSR will apply to all production from the Torrecillas project area.
• The debenture and subsequent NSR (if converted) will be secured against the Engenho mill facilities and will be noted on all relevant mining titles in accordance with relevant Brazilian and Peruvian law.

This acquisition marks another positive step in the Company's strategy to broaden and diversify its portfolio of royalties.

For full details of the announcement please click here.