Aura Gold Inc.
TSX : ORA

Aura Gold Inc.

July 18, 2007 13:18 ET

Aura Gold Inc.: Acquisition of Arapiraca Project Completed; Release of $85 Million From Escrow; Update on Corporate Activities

TORONTO, ONTARIO--(Marketwire - July 18, 2007) -

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Aura Gold Inc. ("Aura Gold" or the "Company") (TSX:ORA) is pleased to advise that a special meeting of Company shareholders was held on July 13, 2007 (the "Meeting") with all resolutions presented at the Meeting approved by shareholders of the Company.

Further details of matters approved at the Meeting are set out in the Company's information circular dated June 15, 2007, which is available under the Company's profile on SEDAR at www.sedar.com.

Arapiraca Project

The Company is pleased to announce that it has closed its previously announced acquisition of the Arapiraca copper-gold development project (the "Arapiraca Project") located in the State of Alagoas in northeastern Brazil (the "Acquisition") from Zoneplan Limited ("Zoneplan") and Repalla Inc. ("Repalla"). The Company has issued an aggregate of 320 million common shares as consideration for the Acquisition, 70 million of such shares being subject to certain escrow restrictions.

Work has commenced on the Arapiraca Project with drilling underway on the Serrote da Laje deposit. Two rigs are currently on site with a third rig scheduled to arrive in late July 2007. The Company plans to drill approximately 20,000 metres of in-fill and step-out drilling at Serrote da Laje in 2007, leading up to an updated National Instrument 43-101 resource calculation in the fourth quarter followed by a preliminary economic evaluation. This new resource is expected to include iron and nickel, as well as copper and gold.

The Company is also completing the construction of a sample preparation facility under the supervision of SGS Laboratories. This facility will allow on-site third party sample preparation, which will reduce the turn-around time for assaying.

A detailed 250 line kilometre ground magnetic survey has been completed on the Caboclo target and the data is currently being processed. This will help to better define drill targets in the area prior to drilling in August 2007. A separate geological team is being hired to explore several known targets in the area.

Private Placement Financing

The Company previously announced the closing of a private placement on May 1, 2007 of 126,000,000 subscription receipts (the "Subscription Receipts") for gross proceeds of $100,800,000. Upon closing of the private placement, approximately 11% of the net proceeds were released to the Company with the balance placed in escrow. The Company has satisfied the conditions for the release of the funds in escrow and the remaining net amount of approximately $85,000,000 has been delivered to the Company. In accordance with the subscription receipt indenture dated May 1, 2007, each Subscription Receipt has been deemed exchanged without payment of any additional consideration for one common share of the Company. All such common shares are subject to resale restrictions until September 2, 2007.

Corporate Developments

The Company is pleased to announce that William Murray, P.Eng., has agreed to join the Board of Directors of the Company, effective July 14, 2007. Mr. Murray has over 30 years of international mining experience in operations, engineering and construction. He is currently President and CEO of PolyMet Mining Corp. where he has been instrumental in developing and advancing the large scale poly-metallic NorthMet project located in the Minnesota Iron Range.

Mr. Murray previously worked in senior management positions at Denison Mines, Anglo American Corporation and Fluor Daniel. Most notably, in the mid-1980s Mr. Murray was part of a consortium that bought Placer's Craigmont Copper Mine, located in British Columbia, principally for its by-product iron in the form of magnetite. Mr. Murray was directly responsible for the successful design, construction and operation of the magnetite recovery plant which is still in operation.

Mr. John Burzynski, will be stepping down from the Board. The Company would like to thank Mr. Burzynski for his valuable contributions to the Board since his appointment.

With shareholder approval received at the Meeting, the Company will be proceeding with the implementation of the following in due course:

- 2007 Stock Option and Share Compensation Plan (the "Plan") pursuant to which the number of options and bonus shares that may be authorized, granted and available under the Plan will be 10% of the Company's issued and outstanding common shares as at the date of grant. The Plan will replace the previous plan;

- Change in the name of the Company to "Aura Minerals Inc.", or such other name as may be acceptable to the Director appointed under the Canada Business Corporations Act and the Toronto Stock Exchange;

- Consolidation of the Company's authorized capital on the basis of one new common share for every five existing common shares, subject to adjustment, and the amendment of the Company's articles accordingly.

The Company wishes to advise that PricewaterhouseCoopers LLC, in Vancouver, British Columbia, has been appointed as the new auditors of the Company, effective as of July 6, 2007, subject to all regulatory approvals. With the recent relocation of the Company's offices to Vancouver, the current auditors, McGovern, Hurley, Cunningham, LLP, whose offices are located in Toronto, have resigned effective July 6, 2007.

About Aura Gold Inc.

Aura Gold Inc. (TSX:ORA) is a Canadian exploration company focused on the acquisition and development of mineral deposits in Brazil and South America. The acquisition and development of the Arapiraca gold/copper/iron ore project is part of an ongoing strategy to build Aura Gold into a mid-tier producer in the near term. Aura Gold's other projects are the Cumaru, the Inaja Greenstone Belt and the North Carajas Claims, which collectively total approximately 600,000 hectares in the Carajas Metallogenic Province of north central Brazil.

The securities being offered have not, nor will they be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.

Cautionary Statement:

This news release contains forward-looking statements contained that are not historical facts. Forward-looking statements involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward looking statements in this news release include, but are not limited to, the realization of mineral resource estimates, the construction of a sample preparation facility, the implementation of the Plan, the name change of the Company and the consolidation of the Company's capital. Factors that could cause actual results to differ materially from these forward-looking statements include those risks set out in Aura Gold's public documents filed on SEDAR. Although Aura Gold believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Aura Gold disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Contact Information

  • Aura Gold Inc.
    Patrick Downey
    President & CEO
    (604) 669-4777
    or
    Aura Gold Inc.
    Michele Jones
    Vice President, Corporate Affairs & Corporate Secretary
    (604) 669-4777
    (604) 696-0212 (FAX)
    Email: info@auragoldinc.com
    Website: www.auragoldinc.com