VANCOUVER, BRITISH COLUMBIA, Sep. 2, 2009 (Marketwire) -- VANGOLD RESOURCES LTD. ("Vangold" or "the Company") (TSX VENTURE:VAN) is pleased to announce that the Company and New Guinea Gold Corporation ("NGG") have agreed to make the letter of intent, previously announced on August 20, 2009, a fully binding agreement (the "Agreement"). On August 27, 2009, Vangold advanced a US$500,000 loan to NGG, in addition, after the separation of assets to the shareholders, Vangold will issue from treasury 19.9% of the issued capital of Vangold to NGG as the remainder of the purchase price. Under the Agreement, Vangold will acquire from NGG 100% of four well advanced gold properties in Papua New Guinea ("PNG") along with equipment and drill rigs. Extensive drilling and labour completed on the Mt Penck property over the last six years have produced excellent indications of a large low-grade gold deposit. As a priority, the Company will aggressively pursue its exploration program on Mt Penck to exploit results to date.
Vangold would also like to clarify that under its proposed unbundling of assets, Vangold's shareholders, as of record date for the separation of assets, will receive common shares of a newly incorporated public company (VanOil) which will hold Vangold's oil and gas assets in Kenya, Rwanda and Alberta. The Company will be offering to eligible shareholders rights to acquire additional common shares in VanOil.
All of the above information is subject to TSX Venture Exchange and shareholder approval. The Company is consulting with its advisors and will be sending out an information circular for a special meeting for shareholders to approve.
New Guinea Properties
Mt Penck Property (102.6 sq km)
Mt Penck will be Vangold's principal gold property and will be subject to a concerted exploration effort in 2009/2010 to define resources.
More than 80 holes totalling 6,000m have been completed with intervals such as 72m at 1.79g/t gold, 2m at 36.7g/t gold and 43m at 2.35g/t gold. Bulldozer trenching has yielded results such as 40m at 8.89g/t gold, 97m at 3.39g/t gold and 5m at 60g/t gold. Results are available in a NI 43-101 report lodged at Sedar.
The Mt Penck property is located in West New Britain Province, Papua New Guinea. Access to the property is by road from the provincial capital of Kimbe. The property is within a few kilometers of the coast.
Mt Penck is an eroded strata-volcano with gold mineralization associated with an intrusive complex. The Company has identified a 4 square kilometer arsenic/gold geochemical anomaly within the 100 square kilometer license. Most of the license is yet to be explored.
Five prospects have been identified through soil geochemistry, trenching and drilling: Kavola East, Kavola South, Peni Creek, Big Bend and Koibua.
