HALIFAX, NOVA SCOTIA--(CCNMatthews - Sept. 8, 2006) - Gregory Isenor, President and CEO of Merrex Gold Inc., ("Merrex") (TSX VENTURE:MXI) is pleased to make the following announcement.
Merrex Gold, together with its joint venture partner Celtic Minerals Ltd. ("Celtic"), together acting as the West Voisey's Bay Joint Venture, has entered into an option agreement with CanAlaska Ventures Inc. and Columbia Yukon Explorations Inc. to acquire a 100% interest in the VB-2 property, a 60 claim (15 sq km) block. The VB-2 claims are located immediately to the east of the Merrex/Celtic West Voisey's Bay Joint Venture property and south of Inco's Voisey's Bay property. This option agreement increases the West Voisey's Bay Joint Venture current land position in West Voisey's Bay to 511 mineral claims totaling 127.75 square kilometers.
Under the terms of the option agreement Celtic and Merrex will make cash payments, share issuances and incur exploration expenditures as follows.
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Due Date Cash Share Issuances Exploration
Payments Expenditures
CDN $ CDN$
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On execution of $25,000 25,000 Merrex shares
Formal 25,000 Celtic shares
agreement
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By the first
anniversary $50,000 25,000 Merrex shares
25,000 Celtic shares $100,000 (firm)
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By the second
anniversary $75,000 25,000 Merrex shares
25,000 Celtic share $250,000
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By the third
anniversary $100,000 25,000 Merrex shares
25,000 Celtic shares $500,000
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By the fourth
anniversary 25,000 Merrex shares
25,000 Celtic shares $750,000
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TOTALS $250,000 125,000 Merrex shares
125,000 Celtic shares $1,600,000
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If the option is exercised the vendors will receive a 2% Net Smelter Royalty of which Celtic and Merrex can purchase half for $2.0 million.
It is anticipated that the Voisey's Bay Joint Venture will conduct a detailed geophysical survey consisting of UTEM, magnetotellurics ("MT") and gravity on the property to satisfy the first year's exploration expenditure requirement.
The Voisey's Bay Joint Venture has conducted an extensive geophysical survey on its adjacent West Voisey's Bay property and has delineated a large geophysical anomaly in the Makhavinekh Lake ("Mak Lake") area that trends on the newly optioned VB-2 claims. The geophysical anomaly is comprised of a coincidental east-west trending UTEM conductor and strong MT conductor that has been traced over a strike distance of 1.3 kilometers up to the VB-2 claim boundary. The UTEM conductor is interpreted as a shallowly south dipping (sub horizontal) tabular conductor which intersects a strong MT conductor near the northeast end of a peninsula in Mak Lake. The UTEM response was detected at a higher frequency and was still detected at the lowest base frequency which eliminates the response of many 'moderate' conductors. A review of regional magnetic data reveals a magnetic linear feature that also correlates with the UTEM/MT conductor.
A 5,000 meter diamond drilling is currently underway on the West Voisey's Bay Joint Venture property. (see Merrex Gold News Release July 12, 2006.) Results from the drill program will be released as soon as they are received from the West Voisey's Bay Joint Venture operator.
Merrex Gold is a mineral resource exploration company focused on exploration for gold in Mali, West Africa, for zinc-lead in Cape Breton, Nova Scotia and for nickel in Voisey's Bay, Newfoundland.
Gregory Isenor, President
This press release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future exploration drilling, exploration activities and events or developments that the Company expects, are forward looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions.
FOR FURTHER INFORMATION PLEASE CONTACT:
Merrex Gold Inc.- Halifax office
Greg Isenor
President
(902) 832-5555
Merrex Gold Inc. - Vancouver office
John Cumming
Director
(604) 484-6613
info@merrexgold.com
www.merrexgold.com
