Merrex Gold Inc.

Merrex Gold Inc.

February 26, 2008 13:40 ET

Merrex Unveils Strategic Plan: Dedicated to Gold, Focused in Mali

HALIFAX, NOVA SCOTIA--(Marketwire - Feb. 26, 2008) - Gregory Isenor, President and CEO of Merrex Gold Inc. ("Merrex")(TSX VENTURE:MXI) announces that Merrex will implement a strategy to position itself as pure gold company focused in Mali.

The Merrex Strategy

"Merrex will dedicate itself exclusively to gold and to its core gold assets in Mali" said Merrex President and CEO Gregory Isenor. "We recognize that our Mali gold project has tremendous potential. To realize that potential Merrex must focus its attention on that project alone. Therefore, starting immediately we are taking steps to divest the company of all non-core assets.

We have launched an ambitious 20,000 metre drill program to develop a resource at Siribaya. We also plan to aggressively explore Zone Bambadinka and another very significant geological structure on our Kofia and Babara permits."

The Plan for Mali

Merrex's west Mali properties total 700 square kilometres with an additional 200 square kilometres in permits pending.


The Siribaya Structure is over 10 kilometres long and one kilometre wide, or 10 square kilometres. Detailed drilling at Zone 1B has tested only one kilometre of the ten kilometre strike length. Management believes that the Siribaya Structure is part of a major gold bearing system and has the potential to develop into a significant deposit. Therefore, a 20,000 metre drill program is planned for 2008.

Phase I of the 2008 drilling program at Siribaya will be approximately 2,000 metres at Zone 1B which, at present, is one of the primary exploration targets on the Siribaya Structure. (News release February 4, 2008)

Based on the integration of the geology, geochemistry, geophysics, RAB drilling and diamond drilling within Zone 1B, Merrex has generated a geological model and outlined the first of the mineralized sub-zones which is approximately 1000 metres long, 7 - 12 metres average true width, at least 150 metres deep grading between 2 and 5 grams per tonne gold. The gold is associated with fine grained sulphides and disseminated mainly in felsic rocks with occasional graphite. This zone is open along strike and at depth.

The 2008 Phase I drilling will test both the strike and down dip extension of this sub-zone.

Within Zone 1B there are several other gold intersections outlined by prior Merrex drilling. Similar to other deposits in West Mali, it is expected that continued drilling will further define these additional sub-zones within Zone 1B and identify subsidiary structures and the controls of mineralization.

Phase I of the 2008 drilling program is designed to test both the strike extension and down dip extension of this sub-zone to a depth of 200 metres. Zone 1B remains open to the north, south and at depth.

It is anticipated that the initial drilling at Zone 1B will allow a resource estimation.

Zone Bambadinka

At Zone Bambadinka initial geochemistry outlined a gold anomalous zone five kilometres long and one kilometre wide. As previously announced, the geochemistry at Zone Bambadinka yielded over 30 samples greater than one gram per tonne and one as high as 25 grams per tonne. The surface gold is contained in a transported laterite layer and an initial pitting program indicates this lateritic layer is at least two metres thick.

A detailed program of deep pitting and trenching (a series of 200 pits dug to approximately 7 metres depth and trenches over one kilometre in length) is underway to identify the potential and extent of this mineralization and to evaluate the possibility of further developing what management feels is a surface lateritic deposit.

Management anticipates that once assays from the trenching and pitting program are received and analyzed a substantial program of RAB drilling will be undertaken on Zone Bambadinka.

Babara and Kofia Permits

On the Babara and Kofia permits approximately 15 kilometres east of Siribaya, there is a significant gold-anomalous geological structure similar to Siribaya that is, as yet, unexplored. At approximately 100 square kilometres, this new exploration region is larger than Siribaya and Bambadinka combined.

At Babara a program of regional geochemistry is underway to be followed by a program of detailed geochemistry. It is anticipated that the geochemistry will be followed by trenching and pitting and, if warranted, RAB drilling.

Positioning Merrex as a Dedicated Mali Gold Company

To position Merrex as a dedicated or 'pure play' gold company focussed in Mali the board of directors plans to dividend all non-core assets to the shareholders of Merrex. The divestiture of assets will be done as quickly as practicable.

Jubilee Zinc Project and the Regional Zinc Properties

The divestiture plan proposes that the Jubilee Zinc Project, together with all of the Nova Scotia Regional Zinc properties, will be transferred to a new base-metal corporation, the shares of which will be distributed to the shareholders of Merrex as a dividend in specie. Due to the value of the assets to be distributed to shareholders, there are certain Income Tax Act considerations necessary to minimize the income tax consequence of the distribution to Canadian resident shareholders and, therefore, an advance income tax ruling has been requested.

Additionally, Merrex has 'flow-through' cash-on-hand which must be spent on Canadian qualifying properties during calendar 2008. Therefore, management intends to complete at least one further phase of drilling at Jubilee prior to the divestiture of the Jubilee assets.

It is intended that the shares of this new corporation be listed for trading on the TSX Venture Exchange, subject to meeting necessary listing requirements.

The timing and the details of this distribution will be announced at a future date. This distribution will also be the subject of a Special Meeting of the shareholders.

Balance of the Non-core Assets

The balance of Merrex's non-core assets does not have the same 'value' issue for taxation purposes as the Jubilee Zinc Project. Therefore, management intends to transfer all of those non-core assets to a newly incorporated company, the shares of which will be distributed as quickly as practicable as a dividend in specie to the shareholders of Merrex.

It is intended that the shares of this new second corporation be listed for trading on the TSX Venture Exchange, subject to meeting necessary listing requirements.

All of the reorganization steps described herein are subject to shareholder and regulatory approvals as may be required.

Mali Primary Exploration Focus

In summary, Merrex's primary exploration focus will continue to be its Siribaya Gold Project in west Mali where Merrex holds five mineral permits with two additional permit in process covering over 900 square kilometres, all within the West Mali Gold Belt, a region which currently produces in excess of one million ounces of gold per year from such well-known large gold deposits as the Sadiola and Loulo mines. In addition, Merrex is in various stages of negotiations to acquire additional mineral permits in the area which, when completed, would result in a contiguous land position of approximately 1,000 square kilometres.

Merrex Gold is a mineral resource exploration company with a solid organization of people and projects to enable continued 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.


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