(All dollar figures are in US dollars unless otherwise indicated)

TORONTO, Nov. 24, 2015 /CNW/ - New Gold Inc. ("New Gold") (TSX:NGD) (NYSE MKT:NGD) today announces that the company has completed the previously announced sale of its 30% interest in the El Morro project to Goldcorp Inc. ("Goldcorp"). In exchange for the company's 30% interest, New Gold has realized $60 million in net cash ($90 million less taxes and transaction costs) and the company's $94 million carried funding loan payable has been cancelled. In addition, New Gold will receive a 4% gold stream on gold production from the El Morro property. The transaction provides New Gold with increased financial flexibility, strengthens the balance sheet and enables the company to maintain exposure to El Morro's significant gold reserves and ongoing exploration potential.

KEY TRANSACTION HIGHLIGHTS

Strengthened Balance Sheet

Realized net cash consideration of $60 million
The $94 million in debt that Goldcorp (and previous joint venture partners) funded on the company's behalf has been cancelled


Continued Low-cost Gold Exposure

4% stream on life-of-project gold production from the 417 square kilometre El Morro property
El Morro's currently estimated gold mineral reserves – 599 million tonnes at an average gold grade of 0.46 grams per tonne, totalling 8.9 million ounces
Measured and Indicated mineral resources (exclusive of reserves) – 92 million tonnes at an average gold grade of 0.41 grams per tonne, totalling 1.2 million ounces
Inferred mineral resources (including open pit and underground resources) – 678 million tonnes at an average gold grade of 0.30 grams per tonne, totalling 6.5 million ounces
New Gold to pay fixed $400 per ounce on the first 217,000 ounces of gold delivered as part of the stream; thereafter, the cash purchase price will be $400 per ounce plus an annual 1% inflation adjustment calculated from November 2016


In conjunction with the transaction, Goldcorp and Teck Resources Limited ("Teck") have combined their respective El Morro and Relincho projects into a 50/50 joint venture with the interim name of Project Corridor.

Based on the results of the Project Corridor Preliminary Economic Assessment, when ore is sourced from El Morro, gold production is expected to average over 400,000 ounces per year which would enable New Gold to purchase over 16,000 ounces of gold per year at $400 per ounce. Goldcorp and Teck are expecting to commence a Pre-Feasibility Study in the third quarter of 2016 which should be completed by the end of 2017.

ABOUT NEW GOLD INC.

New Gold is an intermediate gold mining company. The company has a portfolio of four producing assets and two significant development projects. The New Afton Mine in Canada, the Mesquite Mine in the United States, the Peak Mines in Australia and the Cerro San Pedro Mine in Mexico, provide the company with its current production base. In addition, New Gold owns 100% of the Rainy River and Blackwater projects, both in Canada, as well as a 4% gold stream on the El Morro project located in Chile. New Gold's objective is to be the leading intermediate gold producer, focused on the environment and social responsibility. For further information on the company, please visit www.newgold.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information contained in this news release, including any information relating to New Gold's future financial or operating performance are "forward looking". All statements in this .... etc. etc..

EL MORRO MINERAL RESERVES AND RESOURCES (ON A 100% BASIS)

EL MORRO MINERAL RESERVES AND RESOURCES SUMMARY TABLE AS AT DECEMBER 31, 2014 (100% basis)

Metal grade Contained metal Tonnes 000s Gold g/t Silver g/t Copper % Gold Koz Silver Koz Copper Mlbs

MINERAL RESERVES
Proven 321,814 0.56 - 0.55 5,820 - 3,877
Probable 277,240 0.35 - 0.43 3,097 - 2,627
Total El Morro P&P 599,054 0.46 - 0.49 8,917 - 6,503

MEASURED AND INDICATED MINERAL RESOURCE
Measured 19,790 0.53 - 0.51 340 - 223
Indicated 72,563 0.38 - 0.39 883 - 630
Total El Morro M&I 92,353 0.41 - 0.42 1,220 - 853

INFERRED RESOURCE
El Morro - Open Pit 564,217 0.16 - 0.26 2,903 - 3,233
El Morro - Underground 113,840 0.97 - 0.78 3,550 - 1,957

NOTES TO MINERAL RESERVE AND RESOURCE ESTIMATES

1. New Gold's mineral reserves have been estimated in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Definition Standards for Mineral Resources and Mineral Reserves adopted by CIM Council on May 10, 2014 and incorporated by reference in National Instrument 43-101 ("NI 43-101").

2. For year-end 2014 mineral reserves for the El Morro property have been estimated based on the following metal prices and lower cut-off criteria:

Mineral Property
Gold ($/oz) Silver ($/oz) Copper ($/lb) Lower Cut-off
El Morro $1,300 - $3.00 0.20% Cu Eq

3. New Gold reports its Measured and Indicated mineral resources exclusive of mineral reserves. Measured and Indicated mineral resources do not have demonstrated economic viability. Inferred mineral resources have a greater amount of uncertainty as to their existence, economic and legal feasibility, do not have demonstrated economic viability, and are likewise exclusive of mineral reserves.

4. For year-end 2014 mineral resources for the El Morro property have been estimated based on the following metal prices and lower cut-off criteria:

Mineral Property
Gold ($/oz) Silver ($/oz) Copper ($/lb) Lower Cut-off

El Morro $1,500 - $3.50 0.20% Cu Eq

5. Mineral resources are classified as Measured, Indicated and Inferred resources and are reported based on technical and economic parameters consistent with the methods most suitable for their potential commercial exploitation. Where different mining and/or processing methods might be applied to different portions of a mineral resource, the designators 'open pit' and 'underground' have been applied to indicate envisioned mining method. Mineral reserves and mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing and other risks and relevant issues. Additional details regarding mineral reserve and mineral resource estimation, classification, reporting parameters, key assumptions and associated risks for the El Morro property are provided in the NI 43-101 Technical Report for the El Morro Project, Region III, Chile, dated March 26, 2012 which is available under New Gold's profile at www.sedar.com.

6. The preparation of the mineral reserve and mineral resource estimates for the El Morro property has been done by Qualified Persons as defined under NI 43-101, under the oversight and review of Mr. Mark A. Petersen, a Qualified Person under NI 43-101.

SOURCE New Gold Inc.

- See more at: http://www.newgold.com/investors/NewGoldNews/PressReleaseDetail/2015/New-Gold-announces-closing-of-El-Morro-transaction/default.aspx#sthash.ny7BIrFt.dpuf