Merrex Gold Inc.
TSX VENTURE : MXI

Merrex Gold Inc.

October 21, 2008 07:43 ET

Merrex Reaches $12,000,000 Deal with IAMGOLD for Siribaya

HALIFAX, NOVA SCOTIA--(Marketwire - Oct. 21, 2008) - Gregory Isenor, P.Geo., President and CEO of Merrex Gold Inc. ("Merrex")(TSX VENTURE:MXI) announces that Merrex and IAMGOLD Corporation ("IAMGOLD") have agreed on the commercial terms of an option for 50% of Merrex's Siribaya Gold Project in West Mali, Africa.

$12,000,000 Option and Private Placement

The commercial terms of a $12,000,000 option and private placement have been agreed between Merrex and IAMGOLD. Pursuant to the commercial agreements reached IAMGOLD may incur $10,500,000 of exploration expenses over four years to earn a 50% interest in the Siribaya Gold Project. Merrex will be the initial project operator. IAMGOLD will also invest $1,500,000 in Merrex by subscribing for 4,285,714 private placement units at $0.35 per unit. Each unit will be comprised of one share and one twelve-month share purchase warrant exercisable at $0.45.

Commentary

"Over the past two years, as each successive drill program produced better and better results, we became increasingly confident in our Siribaya Gold Project" said President Gregory Isenor. "Numerous gold producers have reviewed our data and visited our project site in Mali. From the beginning, IAMGOLD was at the top of our 'short list' of potential partners for Siribaya. We are pleased that IAMGOLD has committed to Siribaya bringing both considerable financial investment and exceptional gold exploration technical expertise. We also appreciate that IAMGOLD, with its long-standing participation in the Malian mining community, continues to have confidence in the mineral potential of Mali and our Siribaya Gold Project in particular."

Further details of the Siribaya Option Agreement will be released once documentation and due diligence are completed.

Conditions

This commercial agreement remains subject to final documentation and completion of due diligence and regulatory approvals as may be required.

Merrex's principal projects are its Siribaya Gold Project, an advanced exploration project in Mali (West Africa) and its Jubilee Zinc Deposit in Cape Breton, Nova Scotia.

Merrex Gold is a mineral resource exploration company focusing on gold exploration in West Mali, Turkey and in the Red Lake area of Ontario and zinc exploration in Cape Breton, Nova Scotia. Merrex has a solid organization of people and projects enabling aggressive exploration, discovery, and growth.

This press 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 exploration drilling, exploration activities and events or developments that the Company expects, are forward looking statements. Although the Company believes the expectations expressed in such forward-looking 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 forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions.

THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OF THIS RELEASE.

Contact Information

  • Merrex Gold Inc.
    Greg Isenor
    President & CEO
    (902) 832-5555
    (902) 832-2223 (FAX)
    Website: www.merrexgold.com