Great Western Minerals Group Ltd.
TSX VENTURE : GWG
OTCQX : GWMGF

Great Western Minerals Group Ltd.

September 15, 2010 09:30 ET

Great Western Minerals Group Closes Additional $2M Private Placement

SASKATOON, SASKATCHEWAN--(Marketwire - Sept. 15, 2010) -

(NOT FOR DISTRIBUTION TO THE UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES)

Great Western Minerals Group Ltd. (TSX VENTURE:GWG) (OTCQX:GWMGF) ("GWMG" or the "Company") announced today that it has closed an additional $2,000,000 (Cdn.) private placement of secured subordinated debentures of the Company (the "Debentures"), subject to regulatory approval.

The proceeds of the debentures will be used for continuation of the Bankable Feasibility Study process for the Steenkampskraal mine in South Africa and general corporate purposes.

Following the announcement that the New Order Mining Right had been issued (June 3, 2010:  "Steenkampskraal Mining Permit Issued by South African Government"), GWMG management authorized the appointment of SRK Consulting Engineers and Scientists of Johannesburg, South Africa to undertake Phase 1 of the feasibility study (June 9, 2010: "Great Western Minerals Groups Launches Steenkampskraal Feasibility Study").

Jim Engdahl, President and CEO of Great Western Minerals Group said, "Successfully closing another $2 Million of this Debenture offering enables GWMG to take yet another step in the execution of our plan to become the first integrated Rare Earths producer outside of China. This funding will help ensure the next phase of the feasibility study is commenced as planned. GWMG remains right on track with its strategy."

The Debentures are not convertible, bear interest at a rate of 12% per year and were issued at a price of $1,000 per Debenture. Each lender shall receive 500 common shares of the Company as a commitment fee for every $1,000 of Debentures purchased.

A cash commission equal to 2.0% of the aggregate gross proceeds of the Debentures was paid to Byron Securities Limited of Toronto who acted as the exclusive agent in connection with the offering of the Debentures.

Jim Engdahl, President

About Great Western Minerals Group Ltd.

Great Western Minerals Group Ltd. is an integrated Rare Earths processor. Its specialty alloys are used in the battery, magnet and aerospace industries. Produced at the Company's wholly-owned subsidiaries Less Common Metals Limited in Birkenhead, U.K. and Great Western Technologies Inc. in Troy, Michigan, these alloys contain aluminium, nickel, cobalt and Rare Earth Elements. As part of the Company's vertical integration strategy, GWMG has signed an Off-take Agreement for 100% of the Rare Earth Elements produced at the former producing Steenkampskraal mine in South Africa and holds 20.8% ownership in Rare Earth Extraction Co. Limited, the owner of the Steenkampskraal mine. GWMG also holds interests in seven Rare Earth exploration and development properties in North America.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities of the Company in any jurisdiction. The securities to be issued pursuant to the Offering by the Company have not and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or the securities laws of any state of the United States, and may not be offered or sold in the United States absent registration or an applicable exemption therefrom under the 1933 Act and the securities laws of all applicable states.

Certain information set out in this News Release constitutes forward-looking information. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "could", "anticipate" or "will" and similar expressions) may describe expectations, opinions or guidance that are not statements of fact and which may be based upon information provided by third parties. Forward-looking statements are based upon the opinions, expectations and estimates of management of GWMG as at the date the statements are made and are subject to a variety of known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. Those factors include, but are not limited to receipt of all required approvals (including those relating to the commencement of production at the Steenkampskraal mine) and risks, uncertainties and other factors that are beyond the control of GWMG, risks associated with the industry in general, commodity prices and exchange rate changes, operational risks associated with exploration, development and production operations, delays or changes in plans, risks associated with the uncertainty of reserve or resource estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. In light of the risks and uncertainties associated with forward-looking statements, readers are cautioned not to place undue reliance upon forward-looking information. Although GWMG believes that the expectations reflected in the forward-looking statements set out in this press release or incorporated herein by reference are reasonable, it can give no assurance that such expectations will prove to have been correct. The forward-looking statements of GWMG contained in this News Release, or incorporated herein by reference, are expressly qualified, in their entirety, by this cautionary statement and the risk factors contained in GWMG's current annual information form available at www.sedar.com.

Neither 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.

Contact Information

  • Great Western Minerals Group Ltd.
    Dwight Percy
    Manager of Investor Relations
    (306) 659-4500
    info@gwmg.ca
    www.gwmg.ca
    or
    Great Western Minerals Group Ltd.
    219 Robin Crescent
    Saskatoon, SK S7L 6M8