Keegan Resources Inc.

Keegan Resources Inc.

August 25, 2005 16:51 ET

Keegan Arranges Financing for Drill Programs on Nevada and Ghana Gold Projects; $2.4 Million Non-Brokered Private Placement

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 25, 2005) - KEEGAN RESOURCES INC. (TSX VENTURE:KGN) (the "Company") is pleased to announce that it has arranged, subject to necessary regulatory approvals, a non-brokered private placement of up to 3 million Units of the Company at a price of $0.80 per Unit for total proceeds of up to $2,400,000 CDN. Each Unit will consist of one common share and one non-transferable share purchase warrant entitling the holder to purchase within two years one additional common share of the Company at a price of $1.00 per share. The warrants will be subject to an acceleration clause whereby if the shares of the Company trade above $2.00 for a period of 10 days, the Company will have the option to require the earlier exercise of the warrants within 30 days of formal notice from the company.

Finder's fees in cash or common shares of the Company may be payable in connection to the financing. In addition, the Company may grant non-transferable finder's warrants on the same terms as the private placement warrants.

All securities issued will be subject to a four month hold period.

The proceeds of the financing, coupled with the Company's current treasury, will be used to continue drilling in Nevada, and to accelerate exploration activities toward drilling on the Company's Asumura project in Ghana.

On Behalf of the Board of Directors,

Keegan Resources Inc.

Dan McCoy, President

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this News Release.

Contact Information