Aura Gold Inc.
TSX : ORA

Aura Gold Inc.

August 03, 2006 15:00 ET

Aura Gold Inc. Options Gold-Silver Project In Chile

TORONTO, CANADA--(CCNMatthews - Aug. 3, 2006) - Aura Gold Inc. ("Aura Gold") (TSX:ORA) is pleased to announce it has signed an agreement with Compania Minera Calcia Limitada ("Minera Calcia") to earn a 100% interest in four mining concessions in the Antofogasta Region of northern Chile.

The four major blocks of mining claims totaling 19,300 ha are situated within the Central Valley, a Paleocene precious metals belt west of, and parallel to, Chile's world-renowned porphyry copper belt. The Central Valley is underlain by partially eroded, multiple-vented, volcanic cones and calderas. Strong regional tectonism has imposed a regional N-S structural trend with some NW-SE cross structures, which provide a focus for precious metal mineralization and alteration. The Central Valley hosts many well known and highly profitable precious metal deposits including Meridian Gold's El Penon deposit, as well as the Guanaco, Vaquillas, Cachinal, Juncal El Soldaso deposits and dozens of lesser known deposits, prospects and occurrences.

Meridian's El Penon gold-silver deposit, discovered in the late 1990s, was put into production in 1998 with historic reserves as calculated by Meridian of 1.2 million ounces of gold and 18 million ounces of silver. Exploration has since added proven and probable reserves, which according to public information, are estimated to be 2.1 million ounces of gold and 76.4 million ounces of silver (based on an NI 43-101 compliant figure of 8.4 million tonnes averaging 7.8 g/t gold and 283 g/t silver as of December 31, 2005). The Guanaco deposit, 40 km from El Penon, which is now owned by Kinross and currently in care and maintenance, was mined as an open pit operation in modern times and since discovery in 1878, has produced approximately 1.4 million ounces of gold from the shallow oxidized portion of the veins. The Vaquillas silver mine, southeast of Guanaco, produced almost 20 million ounces of silver and minor amounts of gold from a stockwork deposit mined in the 1980s.

Increased commodity prices, as well as near-mine exploration successes, including rumors of a new large gold discovery, led to a recent regional staking rush in the Central Valley. By tracking land availability and using satellite imagery analysis to delineate alteration similar to the known gold-silver deposits, Minera Calcia identified a large area of interest in which many of the claims were held by a number of very large companies interested strictly in copper or industrial minerals, but not gold. Beginning in July 2005, Minera Calcia was able to acquire the four claim groups as ground was dropped by these non-gold companies.

The claims optioned by Aura Gold exhibit many structural, lithological and alteration characteristics exhibited by the larger gold-silver deposits. Aura Gold plans to investigate and evaluate these claims in preparation for detailed exploration and drilling.

Aura Gold has earned a 45% interest in the claim group by making a cash payment of US$65,000 to Minera Calcia. Aura can earn an additional 45% interest by spending $250,000 on the properties by December 1, 2007. The remaining 10% can be acquired by issuing Aura Gold shares valued at $1 million.

The qualified person responsible for all technical data reported in this news release is Mr. Chris Broili, C.P. Geo and L.P.Geol., a consultant to Aura Gold.

Mel Klohn, VP Exploration for Aura Gold Inc., holds a 25% interest in the Minera Calcia claims. This transaction is a related party transaction under Ontario Securities Commission Rule 61-501 - Insider Bids, Issuer Bids, Business Combinations and Related Party Transactions (the "OSC Rule") by virtue of Mr. Klohn being an officer of Aura Gold and having an interest in the property. The option was approved by all of the directors of the Corporation. The transaction was exempt from the related party valuation and minority security holder approval requirements of the OSC Rule on the basis that the board of directors has concluded that the transaction is worth less than 25% of the market capitalization of Aura Gold.

About Aura Gold Inc.

Aura Gold Inc. (TSX:ORA) is a Canadian exploration company focused on the discovery of gold deposits, primarily in Brazil. Aura Gold's projects are the Cumaru Greenstone Belt, the Inaja Greenstone Belt and the North Carajas Claims, which total approximately 600,000 ha in the Carajas Metallogenic Province of north-central Brazil. The Carajas region is host to a significant number of world-class deposits of iron ore, gold, copper, nickel, manganese and bauxite. Aura Gold intends to become Brazil's pre-eminent mineral explorer and the partner of choice for international mining companies seeking opportunities in Brazil.

Cautionary Statement:

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This news release includes certain "forward-looking statements". All statements other than statements of historical fact, included in this release, including without limitation, statements regarding potential mineralization and reserves, exploration results, future plans and objectives of Aura Gold, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Aura Gold's expectations are the risks detailed herein and from time to time in the filings made by Aura Gold with securities regulators.


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