Virginia Energy Resources Inc.
TSX VENTURE : VAE

Virginia Energy Resources Inc.

September 16, 2009 09:43 ET

Virginia Completes Uranium Program and Acquires More Land

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 16, 2009) - Virginia Energy Resources Inc. (TSX VENTURE:VAE) is pleased to announce it has completed a 7-week, $800,000 exploration program on its Otish Basin properties in north-central Quebec, and signed an agreement to acquire the nearby Strategis property from Big Red Diamond Corporation.

With the acquisition of the Strategis property, Virginia now controls interests in ten claim blocks within and on the margins of the Proterozoic Otish basin (see property map on Virginia website: http://www.santoy.ca/i/maps/2009-09-15_OtishBasin.gif). These properties are prospective for high-grade uranium deposits similar to the Matoush deposit of Strateco Resources Inc., the Seru L zone deposit of Abitex Resources Inc., the South Otish project of Cameco Corporation and the Mistassini property of Strateco Resources Inc. / Majescor Resources Inc.

2009 Exploration Program

The majority of Virginia's 2009 work was directed towards defining drill targets on four properties under option from Xemplar Energy Corporation. Work accomplished included the recovery and re-sampling of 115 metres of well-preserved core from 14 drill holes drilled in the 1980s by Seru Nucleaire Canada Ltee and COGEMA Canada Ltd. (predecessors of AREVA Resources Canada Inc.), stripping and channel sampling of several prospects, 90 line-kilometres of detailed ground magnetic surveys over seven targets, 769 soil samples on nine grids and approximately 850 kilometres of prospecting traverses including the collection of several hundred rock and water samples. Several promising prospects have been identified, and assay results will be released as soon as they are available.

Strategis Property Acquisition

The company has signed of an option agreement with Big Red Diamond Corporation (TSX VENTURE:DIA) for the Strategis Property, comprising 5100 hectares of map designated claims in 97 cells, located between Virginia's wholly owned Otish West property and the Lorenz property under option from Xemplar. The property straddles the Otish Basin unconformity and is located directly west of the Lorenz Gully uranium prospect on the Lorenz property. Uranerz Exploration and Mining Ltd. drilled two drill holes on what is now the Strategis property in 1979. Hole LG-34 is reported to have intersected 2.0 metres grading 1260.7 ppm U3O8, including 0.5 m grading 3440 ppm U3O8 (Quebec assessment report GM36332). Big Red completed an airborne radiometric-magnetic survey in 2007, which identified several promising anomalies for follow-up.

Under the terms of the agreement, Virginia can acquire a 100% interest in the Strategis property subject to a 2% Net Smelter Royalty interest in favour of Big Red and certain underlying vendors, of which 1.5% can be bought back at any time by payment of $1.5 million. To earn its interest, Virginia must pay $50,000 on signing and issue $180,000 in shares within four months after signing. Big Red agrees to finance an approved work program of prospecting, soil sampling and ground geophysics on the property, which will commence immediately.

Shares Issued to Xemplar

As part of its agreement with Xemplar, Virginia issued 600,000 post-consolidation shares in July 2009. To complete the acquisition of a 60% interest in the properties, Virginia must expend $1.5 million on exploration prior to the second anniversary of the agreement (July, 2010). Approximately $1.3 million has been spent to date. Once that work commitment is met, Virginia has the choice of initiating a 60% Virginia-40% Xemplar joint venture in which Xemplar will be carried for the first $1 million in expenditures, or delivering 1.2 million post-consolidation shares to obtain a 100% interest in the property, subject to a 3% NSR, of which 1.5% can be purchased.

Otish Mountains Access Road

In its 2009 budget, the Government of Quebec announced the allocation of $130 million for completion of an all-weather road extending north to the Otish Mountains. The Quebec Ministry of Transport is targeting early 2010 for the start of construction on this important road, which would pass within 5 kilometres of Virginia's Otish West and Beaver properties, providing excellent access for future exploration and development.

The technical information in this news release has been reviewed and prepared by Michael S. Cathro, P.Geo., Virginia's Vice President of Exploration and a Qualified Person as defined in National Instrument 43-101.

On Behalf of the Board of Directors

Virginia Energy Resources Inc.

Norman Reynolds, President & CEO

Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Virginia Energy Resources Inc.
    Norman Reynolds
    President
    (604) 669-4799
    or
    Virginia Energy Resources Inc.
    Tony Perri
    Investor Relations, Manager
    (604) 669-4799
    www.virginiaenergyresources.com