Paragon Minerals Corporation
TSX VENTURE : PGR

Paragon Minerals Corporation

December 11, 2008 20:23 ET

Paragon Minerals Update on Partner Gold Projects, Newfoundland

Completes drill program at South Tally Pond project, reduces exploration activity

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 11, 2008) - Paragon Minerals Corporation ("Paragon") (TSX VENTURE:PGR) reports that Sprott Resource Corp. ("Sprott") (TSX:SCP) has notified the company that it has elected to withdraw from the exploration agreement covering the JBP-Appleton Linear Gold Project in central Newfoundland as it no longer fits their corporate strategy. The JBP Linear property and Appleton Linear property will revert 100% back to Paragon.

The 2008 exploration program funded by Sprott on the JBP Linear property further extended the Pocket Pond gold-bearing quartz vein system over a strike length of 950 metres. Intersections include 12.43 g/t gold over 3.4 metres including 84.77 g/t gold over 0.50 metres and 11.11 g/t gold over 11.90 metres including 255.0 g/t gold over 0.50 metres (see news release dated May 7, 2008). The vein system remains open in all directions. Drilling at the Appleton Linear property (6 holes, 625 metres) extended the vein system at three of the gold prospects tested. The most notable at the Keats-Baseline gold showing where drilling extended the gold-bearing quartz vein zone over a 280 metres strike length (see the company website for additional details).

"We appreciated having Sprott as a partner and understand their reasons for withdrawing from the project. The work we completed this year continues to demonstrate the robust nature of this gold-bearing quartz vein system, particularly along the Pocket Pond - H Pond corridor at JBP Linear property," stated Michael Vande Guchte, President and CEO. Paragon will continue to evaluate the results to date and prepare plans for future exploration on the project.

Paragon also recently received notice from Yamana Gold Inc. ("Yamana") (TSX:YRI)(NYSE:AUY)(LSE:YAU) that it has elected to withdraw from the exploration agreement covering the Huxter Lane Gold Project as part of its plans to refocus its exploration efforts. The property will revert 100% back to Paragon. The Huxter Lane project is a bulk-mineable gold target located 90 kilometres south of Grand Falls - Windsor in central Newfoundland. Yamana has funded three drill programs, totaling 31 drill holes (5,362 metres) which have outlined a significant gold-bearing, porphyritic intrusion over a strike length of 1000 metres and to a vertical depth of 225 metres. The mineralized porphyry dips gently to the south and typically contains up to 15% disseminated and vein-hosted arsenopyrite-pyrite mineralization. The porphyry remains open along strike and to depth. Significant drill intercepts have included 2.21 g/t gold over 35 metres (HX06-16), 2.00 g/t gold over 16.85 metres (HX07-24), 1.07 g/t gold over 28.6 metres (HX06-01) and 0.67 g/t gold over 103.35 metres (HX07-20).

"We have appreciated working with Yamana and the expertise that they brought to the Huxter Lane gold project," said Michael Vande Guchte, President and CEO of Paragon. "The work to date has demonstrated robust gold mineralization at this near-surface bulk tonnage target, and we look forward to continued exploration success on this project."

At the 100%-owned South Tally Pond Project, Paragon completed its diamond drill program at the Lemarchant prospect in mid-November. A step-out drill hole located 100 metres to the north of LM08-37 (see news release dated October 30, 2008) intersected altered felsic volcanic rocks with a thick mafic intrusive cutting through the projected massive sulphide zone. A second step out drillhole, located 100 metres south of the 2007 discovery drillhole (LM07-13) intersected mafic volcanic rocks over most of its length with local intervals of mineralized felsic volcanic rocks in the projected target zone. The geology intersected being very similar to that seen down-dip of the discovery drillhole LM07-13. All results are available on the company website.

Paragon has now completed a total of 10,010 metres of diamond drilling in 28 holes at the Lemarchant prospect through which it has discovered a significant precious metal-rich massive sulphide lens over a strike length of 500 metres. The mineralization is interpreted to be open in both directions. The Lemarchant prospect represents one of a number of high quality, underexplored volcanogenic massive sulphide (VMS) targets in the South Tally Pond project area, which is located immediately southwest of Teck Cominco's Duck Pond Mine.

In light of the uncertainty in the financial markets, Paragon has curtailed its exploration activity and is reducing its exploration staff. This includes the departure of Bruce Mitton, Paragon's VP Exploration. Paragon acknowledges the contributions from Mr. Mitton and the geological staff and wishes them well in the future. David Copeland, Exploration Manager will continue to manage the company's exploration efforts in Newfoundland & Labrador. Paragon has sufficient funds to maintain operations in 2009 and is reviewing its core assets and assessing new opportunities.

Paragon Minerals Corporation is a Canadian-based mineral exploration company listed on the TSX Venture Exchange. The company and its exploration partners are focused on gold and base metal exploration in Eastern Canada, specifically within the Province of Newfoundland and Labrador. Further details on the properties can be found on the Company website at www.paragonminerals.com.

PARAGON MINERALS CORPORATION

Michael J. Vande Guchte, President & CEO

Qualified Person - The JBP-Appleton Linear, Huxter Lane and South Tally Pond project work was supervised by Qualified Person David Copeland, M.Sc., P.Geo.

Forward-looking statements - This news release contains certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that the Company expects to occur, are forward looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Forward-looking statements in this document include statements regarding current and future exploration programs, activities and results. 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 may differ materially from those in forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration success, continued availability of capital and financing, inability to obtain required regulatory or governmental approvals and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. The Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change. These statements are based on a number of assumptions, including, among others, assumptions regarding general business and economic conditions, the timing of the receipt of regulatory and governmental approvals for the transactions described herein, the ability of Paragon and other relevant parties to satisfy stock exchange and other regulatory requirements in a timely manner, the availability of financing for Paragon's proposed transactions and exploration and development programs on reasonable terms and the ability of third-party service providers to deliver services in a timely manner. The foregoing list of assumptions is not exhaustive. Events or circumstances could cause results to differ materially.

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

Contact Information

  • Paragon Minerals Corporation
    Bill Cavalluzzo
    VP Investor Relations
    (604) 629-2353
    or
    Paragon Minerals Corporation
    Michael Vande Guchte
    President & CEO
    (604) 629-2353
    Website: www.paragonminerals.com