Luiri Gold Limited

Luiri Gold Limited

August 18, 2009 12:55 ET

Luiri Gold Completes Placement for C$2.6 Million and Starts Major Drilling Programme

TORONTO, CANADA--(Marketwire - Aug. 18, 2009) - Luiri Gold Limited ("Luiri Gold") (TSX VENTURE:LGL) shareholders voted overwhelmingly in favor of a change of control and Luiri Gold has closed the second placement for CDN $ 1,137,167.90 from Lachlan Star Ltd ("Lachlan Star") to bring their holdings to 31%. Luiri Gold has commenced a major plus 10,000m drilling programme both to expand the resource base and upgrade the current resource base for feasibility studies.

Luiri Gold Limited (TSX VENTURE:LGL) is pleased to announce that, at the Special General Meeting of the company held on 28 July 2009, shareholders voted overwhelmingly in favor of the change in control resolution with 99.7% voting in favor with a 37.7% shareholder turnout.

Consequently, Luiri Gold has completed the second phase of the investment by Lachlan Star for 9,476,399 shares at CDN $0.12 for gross proceeds of CDN $ 1,137,167.90 which in aggregate brings the total investment by Lachlan Star in Luiri to CDN $ 2,627,100 for 21,892,500 shares. This will result in Lachlan Star holding approximately 31% of the issued share capital of Luiri Gold.

"The completion of this transaction is a very positive development for Luiri. It now allows us to focus over the next six to twelve months on the two major initiatives in the company which are to expand the overall resource at the Luiri Hill project, and to complete prefeasibility studies on the current resource base", said Mike Sperinck, President and CEO. "We are confident that, by following up on the positive results from the most recent drilling at the five other targets which are all in close proximity to the resources already defined at Matala and Dunrobin deposits respectively, we will be able to increase the resource base. This will enable Luiri to expand the scope of the prefeasibility study to design a mining operation significantly larger than that envisaged on the current resource."

The current drilling programme at the Luiri Hill project will have two major objectives:

- the first is to upgrade (to indicated mineral resource status) all of the resources at the Matala and Dunrobin deposits which fall within conceptual optimized pit outlines; and

- the second is to follow up and define further mineral resources at selected targets identified from the interpretation of the results from the 2008 reverse circular ("RC") drilling programme.

Drilling is due to commence within the next two weeks. A 10,000m contract has been signed with Boart Longyear and will include both diamond and RC drilling. The infill drilling will also include drill holes selected for further variability testwork on the metallurgy of the ores, and for geotechnical and geohydrological studies.

A range of technical and economic studies have commenced with the intention to complete by early 2010 a prefeasibility study for the construction of a new mining operation at Luiri which will be based either on the current resource or on the expanded resource which would result from drilling success in the current drilling program.

In accordance with the agreement with Lachlan Star, Luiri Gold is undertaking all the formalities associated with obtaining the listing of the Luiri shares on the Australian Stock Exchange ('ASX'), which will be in addition to the listing that the company already enjoys on the TSX Venture Exchange.

Shareholders should note that, in relation to the 21 892 500 shares issued :

- there were no finder's fees or warrants in connection with the private placements;

- the shares are subject to a statutory hold period of four months from the date of closing;

- the private placement has received TSX Venture Exchange approval.

About Luiri Gold

Luiri Gold is a gold focused company with a strategy of creating shareholder value through expanding into a geographically diversified gold resource company with assets potentially ranging from producing mines and near term production to exploration properties in Africa. The current focus is at Luiri Gold's wholly-owned Zambian subsidiary, Luiri Gold Mines Limited, which holds mineral tenements within southern-central Zambia covering approximately 1,200km2 of highly prospective exploration ground focused on the Dunrobin and Matala gold deposits. The Luiri Hill Project is situated approximately 120km west-northwest of the Zambian capital of Lusaka in Zambia's Central Province. Access to the Project area is by a newly-upgraded paved road from Lusaka.

The current Mineral Resource at the Luiri Hill Project includes 656,000 ounces gold contained in 7.1 million tonnes at 2.9g/t for the Inferred category and 144,000 ounces gold contained in 2.2 million tonnes at 2.1g/t for the Indicated category (reported in Press Release April 15, 2008).

In addition to the substantial gold resources on the properties controlled by Luiri, the properties also host the large, prominently outcropping hematitic Nambala iron deposit. A review by Coffey Mining indicated that on part of the mineralized body there exists the 'mineral potential' of between 100 and 300 million tonnes of iron at grades of 55-60% Fe. Interpretation of the regional geology indicates that the iron contained in this deposit could be several times larger than this figure. However, there are a number of logistical issues relating to the distance from the project to the coast. The potential quantity and grade is conceptual in nature, and there is insufficient exploration completed at the present time to define a mineral resource.

The Luiri Gold exploration programs and resource calculations are carried out under the supervision of Mr. Michael Sperinck, Member of AUSMIM. Mr. Sperinck is a qualified person (as defined by National Instrument 43-101) with more than 25 years of experience in the mining industry.

About Lachlan Star

Lachlan Star Limited is an emerging minerals exploration and development company headquartered in Perth, Western Australia. The company is focused on acquiring and developing assets within the gold, copper and bulk commodities sectors within Australia and overseas. The company has a board of directors and management team with an impressive track record of advancing resource projects through to production. Lachlan Star's current projects are in Australia and include the Bushranger copper and gold project in New South Wales and the Princhester magnesite deposit in Queensland.


Michael Sperinck, President and CEO

This press release contains forward-looking information which involves risks and uncertainties. Forward looking information represents management's current views and these may change significantly as new information comes to hand.


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