Asia Gold Corp.

Asia Gold Corp.

September 29, 2005 19:18 ET

Asia Gold Executes Definitive Agreement to Option Four Copper and Gold Projects in the Gobi Region of Mongolia

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 29, 2005) - Asia Gold Corp. (TSX VENTURE:ASG), is pleased to announce the signing of a definitive Earn-in Agreement with Solomon Resources Limited (TSX VENTURE:SRB) and Gallant Minerals Limited that provides Asia Gold with the right to earn from Solomon Resources up to a 70% interest in the Toste T-1, Tsakhir, Nurag Uul and Bor Khairhan projects in the Gobi region of southern Mongolia. The projects are subject to an underlying option agreement between Solomon Resources and Gallant Minerals.

The four projects comprise nine Mineral Exploration and Mining licenses covering 31,258 hectares and are strongly prospective for porphyry copper-gold and epithermal gold mineralization. Previous work by Gallant Minerals has identified mineralized systems on all four projects and Asia Gold plans to start exploring these targets in October.

The Earn-In Agreement

The Earn-in Agreement provides Asia Gold with the right to earn a 70% interest in the four projects in two stages. The exercise of the First Earn-in Right will earn Asia Gold a 55% interest in all of the projects. The Second Earn-in Right, which is exercisable on a project by project basis, will earn Asia Gold a further 15% interest, for an aggregate 70% in each selected project.

To exercise the First Earn-in Right Asia Gold must pay Solomon an aggregate of US$325,000, issue to Solomon common shares of Asia Gold valued at US$600,000 and fund and carry out US$1.8 million of exploration within three years from the closing date of the definitive Earn-in Agreement. As part of the annual work commitment, Asia Gold is also responsible for the payment of all license fees.

To exercise the Second Earn-in Right, Asia Gold must fund and carry out US$2.5 million of exploration on each of the projects which it intends to retain within five years from the closing date of the definitive Earn-in Agreement. Asia Gold also has a first right to acquire an additional 10% interest, for an aggregate 80% interest, should Gallant convert its 20% interest in any project to a net smelter royalty, pursuant to an underlying option agreement between Solomon and Gallant.

Upon closing of the definitive Earn-in Agreement, Asia Gold has agreed to pay Solomon US$50,000 cash and 100,000 Asia Gold common shares. For further information on the terms and conditions of the Earn-in Agreement see the Company's News Release dated August 19, 2005.

David C. Owens, a qualified person as defined by National Instrument 43-101, supervised the preparation of the information in this release.

Ivanhoe Mines and BHP Billiton own approximately 47% and 7% respectively of the issued and outstanding shares of Asia Gold.

Forward-Looking Statements: Statements in this release that are forward-looking statements, including the planned exploration of the optioned Mongolia properties, are subject to various risks and uncertainties concerning the specific factors disclosed under the heading "Risk Factors" and elsewhere in the company's periodic filings with Canadian securities regulators. Such information contained herein represents management's best judgment as of the date hereof based on information currently available.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy or this release.

Contact Information

  • Asia Gold Corp. - Investors
    Bill Trenaman
    (604) 681-6799
    Asia Gold Corp. - Media
    Bob Williamson
    (604) 681-6799