Golden Valley Mines Ltd.
TSX VENTURE : GZZ

Golden Valley Mines Ltd.

September 21, 2005 11:51 ET

Golden Valley Mines Announces $2,000,000 Financing with Blackmont Capital Inc.

VAL-D'OR, QUEBEC--(CCNMatthews - Sept. 21, 2005) - Golden Valley Mines Ltd. (TSX VENTURE:GZZ) announces that it has entered into a letter of engagement with Blackmont Capital Inc., formerly First Associates Investments Inc., pursuant to which Blackmont will offer up to 6,660,000 units at $0.30 per unit. Each unit is comprised of one common share and one half of one non-transferable share purchase warrant. Each whole warrant will entitle the holder to purchase one additional common share at a price of $0.35 per share for a period of 12 months from closing of the offering, and thereafter at a price of $0.40 per share, expiring 24 months from closing of the offering. The units will be offered by way of a Short Form Offering Document in the provinces of British Columbia and Alberta and to accredited investors in Ontario and Quebec.

Blackmont will be paid a commission of 8% of the gross proceeds of the offering, a corporate finance fee of $25,000, and will be reimbursed for its legal fees and expenses incurred pursuant to the offering. The Company will also grant Blackmont a non-transferable warrant to purchase a number of units equal to 15% of the total units sold under the offering, at a price of $0.30 per unit for a period of 12 months from closing and thereafter at a price of $0.35 per unit for an additional 12 months.

Golden Valley intends to use proceeds raised from this financing to fund the initial exploration program on the Company's James Bay, Quebec properties, as well as for drilling several of the Company's "drill-ready" targets located within the Abitibi Greenstone Belt, and for general working capital.

Golden Valley is actively exploring its property portfolio comprised several gold properties located in the James Bay (535 sq-km; 132,000 acres) area of Quebec, and multiple grass-roots exploration targets for gold and base metals located in the Abitibi Greenstone Belt, including the eastern portion of the Destor-Porcupine Fault Zone north of Val-d'Or, the western portion of the Blake River Group volcanics in Ontario and several previously untested airborne electromagnetic (AEM) anomalies and structural features elsewhere in the Abitibi region.

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

Contact Information