QGX Ltd.
TSX : QGX

QGX Ltd.

July 13, 2005 12:49 ET

QGX Drills 35 Coal Seams Containing 195 m of Net Coal in Eight Holes at Baruun Naran

WATERDOWN, ONTARIO--(CCNMatthews - July 13, 2005) - QGX Ltd. (TSX:QGX)



BN05008C intercepts 20.0 and 10.8 m seams (estimated true thickness)
BN05009C intercepts 18.2 m and 17.5 m seams
BN05004C intercepts 17.2 m seam
BN05010C intercepts 12.1 m seam


QGX Ltd. (TSX:QGX.T) is pleased to announce that eight drill holes intercepted 35 coal seams (@ 2-m coal seam cutoff) containing 195 m of net coal (estimated true thickness). These eight holes, together with the first three holes drilled by QGX (see press release of May 18th), confirm the presence of multiple coal seams over a minimum of 8 km of strike distance. Four drill holes cut six large coal intercepts, each in excess of 12 m estimated true thickness (see Table 1 below for a summary of drill-hole results).

In light of this success, QGX has expanded the exploration program at Baruun Naran. A second drill rig commenced drilling on June 27th and two additional drill rigs are scheduled to arrive in August. A third backhoe is on order to facilitate district exploration. In addition, a geophysical program to test for coal seams and structural features beneath 1-10 m of cover began last week and is yielding positive results.

David Anderson, CEO of QGX, commented as follows:

"The results at Baruun Naran continue to fuel our enthusiasm for the property. We're finding a lot of coal-nearly 200 m of net coal-in just eight holes scattered about the western half of the coal valley. Many of the seams are thicker, than the coal seams now being mined in western Canada and exported to China. Our goal is to demonstrate a volume of high-quality coal contained in multiple seams with an aggregate thickness of greater than 40 m, a down-dip extend of 200 m and a length of 9.5 km. We believe we are on track with this goal which will support our objective to supply coal to the power and steel markets of northern China."

Drilling Results

QGX drilled eight holes in four areas or "clusters" contained within the western half of the coal valley. Table 1 presents a summary of the drilling results. Table 2 lists the location and orientation for each of the eight holes shown in Table 1. (To view a map showing the location of the QGX drill holes, please click on the link below or copy and paste link into browser: http://www.qgxgold.com/assets/PDF_downloads/DrillHoleslocationmapholes001-011_050711.pdf.) All widths cited below for coal seams and net coal contained in intercepts from the eight drill holes are reported as estimated true thickness based on our current understanding of the coal stratigraphy and borehole orientation.

Highlights include:

a) BN05009C and -10C were designed to test the down-dip extension of the 24.5 m (apparent thickness) coal seam cut in BN05002C (see press release of May 18th). The holes cut three substantial coal seams, ranging from 12.1 to 18.2 m thick.

b) BN05004C was drilled to test coal seams exposed in a 2-km long trench and intersected a large seam containing15.4 m of net coal as well as two smaller seams lower in the hole.

c) Hole BN05008C tested the down-dip extension of several coal seams cut in BN05003C, including one seam containing 22.2 m (apparent thickness) net coal. The hole intersected nine coal seams aggregating 63.2 m in thickness, including three seams over 9 m thick (9.1, 10.8, and 20.0 m). This hole also demonstrated a down-dip continuity of up to 150 m for the seams cut in BN05003C. This was confirmed by BN05011C, drilled 50 m to the west (to avoid poor ground conditions), which cut multiple coal seams summing to 33.8 m in thickness and containing 27.8 m of net coal.

d) BN05005C and -06C targeted coal cut by earlier Russian holes (including two seams 9.9 and 8.8 m apparent thickness) and intersected several 2-5 m thick seams aggregating 13.0 m and 26.1 m net coal, respectively. These holes represent the western most holes drilled by QGX.

Current Exploration Program

Two drill rigs are currently drilling at the eastern end of the coal valley where Hole BN05001C cut a 16 m thick coal seam (apparent thickness) announced last May The coal in this area appears to be folded into a synform. The ongoing drilling is helping to unravel the structural and stratigraphic setting as well as assist in predicting the location of coal seams buried beneath thin cover.

Both short- and long proximates, composite analyses and washability tests have been performed on the first three holes. QGX is waiting for the results of metallurgical quality tests for coal contained in the first three holes. Once these results are received and analyzed by QGX and Norwest, the results will be released.



Table 1. Drill Results for BN05004C through BN05011C,
Baruun Naran, Mongolia

------------------------------------------------------------------------
Estimated
Drill-Hole Interval Measured Thickness True Thickness(1,2)
Number From To Seam(m) Net Coal(m) Seam(m) Net Coal(m)
------------------------------------------------------------------------
BNO5004C 51.40 70.33 18.93 16.98 17.16 15.39
------------------------------------------------------------------------
and 120.50 126.35 5.85 5.38 5.30 4.88
------------------------------------------------------------------------
and 135.43 137.80 2.37 2.37 2.15 2.15
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5005C 70.65 73.90 3.25 3.25 2.95 2.95
------------------------------------------------------------------------
and 75.42 78.24 2.82 2.82 2.56 2.56
------------------------------------------------------------------------
and 79.05 82.00 2.95 2.95 2.67 2.67
------------------------------------------------------------------------
and 86.50 89.75 3.25 2.65 2.95 2.40
------------------------------------------------------------------------
and 131.90 135.45 3.55 2.70 3.22 2.45
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5006C 68.10 71.47 3.37 2.82 3.05 2.56
------------------------------------------------------------------------
and 84.30 89.65 5.35 4.90 4.85 4.44
------------------------------------------------------------------------
and 140.50 146.10 5.60 5.00 5.08 4.53
------------------------------------------------------------------------
and 149.70 154.00 4.30 4.30 3.90 3.90
------------------------------------------------------------------------
and 155.75 162.50 6.75 5.93 5.52 5.37
------------------------------------------------------------------------
and 177.50 183.32 5.82 5.82 5.27 5.27
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5007C 144.73 148.40 3.67 2.40 3.33 2.18
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5008C 19.45 30.60 11.15 9.64 10.77 9.31
------------------------------------------------------------------------
and 43.03 46.35 3.32 3.32 3.21 3.21
------------------------------------------------------------------------
and 67.90 71.45 3.55 3.15 3.43 3.04
------------------------------------------------------------------------
and 78.40 85.65 7.25 5.10 7.00 4.93
------------------------------------------------------------------------
and 88.95 98.40 9.45 7.00 9.13 6.76
------------------------------------------------------------------------
and 110.80 114.40 3.60 2.85 3.48 2.75
------------------------------------------------------------------------
and 120.05 123.00 2.95 2.45 2.85 2.37
------------------------------------------------------------------------
and 144.70 165.35 20.65 18.95 19.95 18.30
------------------------------------------------------------------------
and 181.35 184.90 3.55 3.45 3.43 3.33
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5009C 9.09 37.40 28.31 25.48 18.20 16.38
------------------------------------------------------------------------
and 121.17 139.75 18.58 17.76 17.46 16.69
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5010C 73.35 97.47 24.12 19.19 12.06 9.60
------------------------------------------------------------------------
and 104.80 110.65 5.85 5.45 3.76 3.50
------------------------------------------------------------------------
and 250.50 257.53 7.03 6.73 4.03 3.86
------------------------------------------------------------------------

------------------------------------------------------------------------
BNO5011C 136.00 145.50 9.50 7.70 6.72 5.44
------------------------------------------------------------------------
and 148.80 155.10 6.30 4.00 4.45 2.83
------------------------------------------------------------------------
and 157.20 161.90 4.70 4.70 3.32 3.32
------------------------------------------------------------------------
and 166.00 170.50 4.50 4.50 3.18 3.18
------------------------------------------------------------------------
and 173.00 177.10 4.10 3.10 2.90 2.19
------------------------------------------------------------------------
and 181.90 193.10 11.20 8.90 7.92 6.29
------------------------------------------------------------------------
and 196.60 204.10 7.50 6.40 5.30 4.53
------------------------------------------------------------------------

Footnote 1: Calculated from measured (apparent) seam thickness and
measured (apparent) net-coal thickness using estimated seam
attitude (dip) and angle of bore hole.

Footnote 2: Coal seams listed in Table 1 are based on a 2-m cutoff, true
estimated thickness.


Table 2. Location and Orientation of BN05004C through BN05011C
---------------------------------------------------------------------
Local Grid UTM Coordinates
Drill-Hole Number Easting Northing Easting Northing
---------------------------------------------------------------------
BN05004C 33857 29847 517010 4826571
---------------------------------------------------------------------
BN05005C 29996 30311 513315 4825360
---------------------------------------------------------------------
BN05006C 29140 29677 512807 4824423
---------------------------------------------------------------------
BN05007C 33784 29640 517032 4826353
---------------------------------------------------------------------
BN05008C 31597 29875 514950 4825642
---------------------------------------------------------------------
BN05009C 33997 30501 516861 4827224
---------------------------------------------------------------------
BN05010C 33968 30653 516771 4827349
---------------------------------------------------------------------
BN05011C 31216 29741 514662 4825359
---------------------------------------------------------------------

Local Grid UTM
Elevation Azimuth Azimuth Plunge
Drill-Hole Number (masl) (degrees) (degrees) (degrees)
---------------------------------------------------------------------
BN05004C 1564 170 145 -65
---------------------------------------------------------------------
BN05005C 1546 180 155 -65
---------------------------------------------------------------------
BN05006C 1536 170 145 -65
---------------------------------------------------------------------
BN05007C 1562 180 155 -65
---------------------------------------------------------------------
BN05008C 1548 180 155 -65
---------------------------------------------------------------------
BN05009C 1577 170 145 -60
---------------------------------------------------------------------
BN05010C 1583 170 145 -60
---------------------------------------------------------------------
BN05011C 1546 180 155 -60
---------------------------------------------------------------------


Mr. Steven B. Kerr, Senior Geologist with Norwest Corporation and a Qualified Person as defined by NI 43-101, has reviewed and approved the information contained in this release. QGX has engaged Norwest to provide consulting services regarding the exploration and evaluation of the Baruun Naran coal deposit. Norwest has extensive coal experience in Mongolia including completing a feasibility study of the Tavan Tolgoi coal deposit for the Mongolian Ministry of Infrastructure and Development, providing advisory services to the operating coal mines at Shivee Ovoo and Bagaa Nuur, and overseeing coal exploration programs in Mongolia for other multi-national mining and exploration companies.

About QGX

QGX is a Canadian-based company that has been exploring for mineral deposits in Mongolia since 1994. The Company holds a large area of exploration licenses throughout Mongolia. The Company's most advanced property is the Golden Hills prospect in western Mongolia. QGX has filed an independent NI 43-101 report outlining a resource containing approximately 3.3 million gold-equivalent ounces at the Central Valley Zone of Golden Hills (measured, indicated and inferred). Barrick Gold Corp. holds a 9.5% equity interest in QGX as part of a strategic relationship between the companies.

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

Contact Information

  • QGX Ltd.
    David Anderson
    CEO
    (905) 689-9442
    or
    QGX Ltd.
    Paul Zweng
    COO
    (925) 855-0505
    Website: www.qgxgold.com