WINNIPEG, MANITOBA -- (Marketwire) -- 06/19/12 -- San Gold Corporation (TSX:SGR)(OTCQX:SGRCF) ("San Gold") today announced that it has entered into a purchase and sale agreement with Opawica Explorations Inc. ("Opawica") providing for the purchase by San Gold of a 100% interest in three mineral properties from Opawica.
The properties include the Atikwa Lake gold property, located in the Rainy River gold district of northwestern Ontario as well as the Whitesides-Carscallen property and the Golden property, both located in the West Timmins gold camp, Ontario.
"These are three highly prospective properties that have the potential to substantially increase San Gold's resource base. The properties are located within safe, established mining jurisdictions with two of the properties building on the Company's strong position in the Timmins gold camp," said George Pirie, San Gold's President and Chief Executive Officer.
San Gold will pay Opawica total consideration of 9,925,000 shares of San Gold for the properties. The sale of the properties is subject to certain closing conditions including Opawica shareholder approval at a special meeting of the shareholders of Opawica to be held on July 30, 2012, and all requisite regulatory approvals, including the approval of the TSX Venture Exchange in the case of Opawica and the Toronto Stock Exchange in the case of San Gold. It is anticipated that the closing of the sale will take place on or before August 31, 2012.
Open pit mining operations commenced in 1970 on the Atikwa Lake property with ore processed in a 500 ton per day mill that ceased operations in 1973. Recent drilling programs conducted by Opawica in 2011 have identified gold mineralization below the former producer and more significantly in newly identified footwall zones, specifically drill hole #AT-11-09 which cut 16 metres of 4.06 g/t gold, and drill hole #AT-11-01, intersecting 309 metres of 0.59 g/t gold (see Opawica press releases dated Feb. 28, 2012 and Nov. 28, 2011).
The Whitesides-Carscallen properties are located immediately to the northwest of Lakeshore Gold's West Timmins claims and immediately to the west of SGX Resources Inc.'s Carscallen claims. The Golden property is located in the West Timmins region as well and represents an area of approximately 4km by 3km.
About San Gold
San Gold is an established Canadian gold producer, explorer, and developer that owns and operates the Hinge, 007, and Rice Lake mines near Bissett, Manitoba. San Gold employs more than 400 people and is committed to the highest standards of safety and environmental stewardship. San Gold is listed on the Toronto Stock Exchange under the symbol "SGR" and on the OTCQX under the symbol "SGRCF".
For further information on San Gold, please visit www.sangold.ca.
This news release includes certain "forward-looking statements". All statements, other than statements of historical fact included in this release, including, without limitation, statements regarding forecast gold production, gold grades, recoveries, cash operating costs, potential mineralization, mineral resources, mineral reserves, exploration results, and future plans and objectives of San Gold, are forward-looking statements that involve various risks and uncertainties. These forward-looking statements include, but are not limited to, statements with respect to mining and processing of mined ore, achieving projected recovery rates, anticipated production rates and mine life, operating efficiencies, costs and expenditures, changes in mineral resources and conversion of mineral resources to proven and probable mineral reserves, and other information that is based on forecasts of future operational or financial results, estimates of amounts not yet determinable and assumptions of management.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
San Gold Corporation
President and CEO
1 (416) 214-0024
San Gold Corporation
1 (855) 585-4653