Darnley Bay Resources Limited

Darnley Bay Resources Limited

June 24, 2013 16:00 ET

Darnley Bay Resources Limited Announces Update on Property

TORONTO, ONTARIO--(Marketwired - June 24, 2013) - Darnley Bay Resources Limited. (TSX VENTURE:DBL) (the "Company") announces that it has applied for permits to conduct a magneto-telluric (MT) survey and a geological survey on its main property near Paulatuk, Northwest Territories. Magneto-telluric is a geophysical method of imaging the earth's subsurface by measuring natural variations of electrical and magnetic fields at the Earth's surface. In the 1990's, MT has been successfully used to locate mineral deposits as deep at 1750 metres in the Sudbury nickel camp. In the last 10 years, the technique has seen a number of improvements, particularly with the development of modern 3D inversion. It is now routinely used in the oil industry to better define deep drilling targets. Past gravity and magnetic surveys have outlined 22 targets on the Darnley Bay property and the MT results are expected to assist the Company in prioritizing these targets for an upcoming drill program. At the same time, the Company plans to conduct a geological survey over about 25% of the property. The main areas that will be surveyed will be where the probability of finding outcrops is greater: cliffs, canyons and rivers bed. The objective of the survey is to find alteration zones and dykes/sills with special chemistry, which could be indicators of metallic mineralization at depth. This summer field program is estimated to cost $300,000, and is subject to financing and final permitting.

The Company further announces that it plans to issue a combination of flow-through and non flow-through units, to raise up to $700,000. The flow-through units are being offered at $0.07 per unit, and will consist of one share and one half warrant to purchase one share at a price of $0.10 for two years from the closing of the offering. The non-flow-through units are being offered at $0.05 per unit and will consist of one common share plus one warrant to purchase one common share at a price of $0.10 for two years from the closing of the offering. In the event that the closing sale price of the Company´s common shares on the TSX Venture Exchange is greater than $0.25 per share for a period of 20 consecutive trading days at any time after closing of the Offering, the Company may accelerate the expiry date of the warrants by giving notice to the holders thereof and in such case the warrants will expire on the 30th day after the date on which such notice is given by the Company.

The net proceeds from the Offering will be used to fund development of the Company´s mineral property in Northwest Territories and for general corporate purposes. The Company may pay finder's fees on a portion of the Financing in accordance with TSX Venture Exchange guidelines. All securities issued under the Financing will be subject to a four-month hold period from the date of issuance. The proposed Financing is subject to the approval from the Exchange.

The Darnley Bay property hosts North America's strongest isolated gravity anomaly, which has been favourably compared by the Geological Survey of Canada (GSC) with other prominent gravity anomalies, such as those at the prolific mining camps of Noril'sk in Russia and Sudbury basin in Ontario. It is located near Paulatuk, NWT, on the Arctic coast. The Darnley Bay anomaly is larger and stronger than any of these comparatives by a wide margin, measuring 100 kilometres long north to south and about 80 kilometres wide. The GSC discovered the anomaly in 1969 and its source has never been explained. The company has 100-per-cent control of its exploration and potential development subject to certain back-in and other rights of the Inuvialuit Regional Corporation, which holds the land on which it occurs.

Forward-Looking Information

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that Darnley Bay expects are forward-looking statements. Although Darnley Bay believes the expectations expressed in such statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the statements. There are certain factors that could cause actual results to differ materially from those in forward-looking statements. These include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. For more information on Darnley Bay, investors should review registered filings at www.sedar.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release

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