QGX Ltd.
TSX : QGX

QGX Ltd.

September 14, 2005 06:00 ET

QGX Extends 2nd Metallurgical Grade Seam 'T' In Central Portion of Baruun Naran Coalfield

WATERDOWN, ONTARIO--(CCNMatthews - Sept. 14, 2005) -



Multiple intercepts of Seam "T" range from 15.3 to 26.2 m
(estimated true thickness)

BN05024 intercepts 26.2 m and 17.0 m seams
BN05025 intercepts 10.6 m seam
BN05028 intercepts 17.0 m seam
BN05031 intercepts 15.3 m and 12.3 seams

MORE THICK SEAMS OF COAL CUT IN EASTERN PORTION OF COALFIELD

BN05022 intercepts 13.5 m and 10.8 seams
BN05032 intercepts 13.5 m seam


QGX Ltd. (TSX:QGX) is pleased to announce that a coal seam, first drill tested in Hole BN05002 and determined through laboratory analysis to be metallurgical coal, has been extended along strike and dip. Located in the central area of Baruun Naran, this coal seam, labeled Seam "T", ranges in thickness from 15.3 to 26.2 m (estimated true thickness) and is folded into a syncline similar to the other metallurgical grade coal found in Seam "M" approximately 3.3 km to the east (see press release dated August 30, 2005). In addition, two 10-m-plus thick coal seams have been confirmed stratigraphically below Seam "T" and drilling in the eastern portion of the property continues to extend Seams "M", "N," and "O" to the south.

A drill-hole location map and three new cross sections (33,900E, 34,000E and 37,200E) are available on our website at www.qgxgold.com in the Key Properties-Baruun Naran section. Please see Table 1 below for a summary of the drill-hole results for BN05021-32.

David Anderson, CEO of QGX, commented as follows:

"The similarities between Seam "T" in the central portion of our coalfield and Seam "M" in the eastern portion are remarkable. Lab results on the coal tested to date from these seams indicate they are both metallurgical in grade. They are also both thick and folded into a syncline, thereby doubling the amount of near-surface coal. These are impressive seams--Seam "T" measures 15 to 26 m in width and Seam "M" measures up to 28 m thick.

Despite their similarities, these two coal seams are distinct and separated by approximately 500 m of mostly untested Permian stratigraphy. In this round of drilling we cut two 10-m-plus seams within this 500 m zone. There is still a lot of drilling to be done to delineate the known coal seams as well as to explore the untested, coal-bearing stratigraphy."

Interpretation of Drilling Results

Central Area

Prior to this round of drilling, QGX had drilled only two holes (BN05002 and -09) into Seam "T" which is located in the central portion of the 10+ km long coalfield at Baruun Naran. (see press releases of May 18 and July 13, 2005). Results from BN05002 yielded 17.3 m of metallurgical ("coking") coal, (see press release of August 3, 2005; BN05009 lab results are being analyzed now). Holes BN05024, -28, -30, and -31 on Section 33,900E extend Seam "T" along strike and dip where it remains open. These four holes indicate that Seam "T" is folded into a syncline similar to the syncline containing Seams "M", "N", and "O" some 3.3 km to the east.

Two holes collared further to the south on Section 33,900E cut two 10-m-plus thick coal seams. Seam "P" at the bottom of BN05031 measured 12.3 m in thickness. This coal seam was previously cut in Russian Hole DH1533. Finally, BN05025 cut a 10.6-m-thick coal seam that QGX believes is the down-dip extension of coal cut by BN05004.

Eastern Area

Holes BN05021, -22, -26, -29, and -32 along Section 37,200E in the east extend Seams "M", "N", and "O" to the south of where first described in the press released dated August 30, 2005. Most of these new intercepts represent Seams "N" and "O" with four intercepts greater than 9.5 m. Eleven other intercepts cut coal greater than 5 m thick. Normal faults have down dropped the seams to the south, thereby repeating the coal sequence. The repetition of the coal seams increases the potential tonnage of near-surface coal that may be amenable to open-pit mining.

Hole BN05032 encountered poor core recovery where the two lowermost coal intercepts occurred (136-164 m down hole). As a result, the estimates for apparent net coal and estimated true thickness for that hole were significantly reduced given the uncertainty.

Note: No laboratory results for the coal intercepts presented in Table 1 have been completed to date. Therefore definitive statements regarding the coal rank or properties for these intercepts cannot be made at this time.



Table 1.
Drill Results for BN05021 through BN05032, Baruun Naran, Mongolia
------------------------------------------------------------------------
Drill-Hole Hole Measured Estimated True
Number Type Interval Thickness Thickness (1),(2)
------------------------------------------------------------------------
From To Seam Net Coal Seam Net Coal
(m) (m) (m) (m)
------------------------------------------------------------------------
BN05021 PCD/C 110.60 129.80 19.20 13.30 8.11 5.62
------------------------------------------------------------------------
and " 133.80 150.50 16.70 15.50 7.06 6.55
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05022 PCD 63.50 68.50 5.00 3.80 4.92 3.74
------------------------------------------------------------------------
and " 75.20 83.10 7.90 5.00 7.78 4.92
------------------------------------------------------------------------
and " 84.80 95.80 11.00 8.80 10.83 8.67
------------------------------------------------------------------------
and " 111.90 115.00 3.10 3.10 3.05 3.05
------------------------------------------------------------------------
and " 119.20 124.90 5.70 4.60 5.61 4.53
------------------------------------------------------------------------
and " 128.20 141.90 13.70 11.10 13.49 10.93
------------------------------------------------------------------------
and " 169.80 176.00 6.20 4.70 6.11 4.63
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05023 No significant coal seam intercept
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05024 C 111.05 163.40 52.35 47.75 26.18 23.88
------------------------------------------------------------------------
and " 180.85 185.60 4.75 4.75 4.73 4.73
------------------------------------------------------------------------
and " 188.60 190.95 2.35 2.14 2.34 2.13
------------------------------------------------------------------------
and " 193.90 210.96 17.06 16.06 17.00 16.00
------------------------------------------------------------------------
and " 268.10 270.50 2.40 2.40 2.40 2.40
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05025 PCD 24.00 26.80 2.80 2.60 2.42 2.25
------------------------------------------------------------------------
and " 59.00 62.00 3.00 2.80 2.60 2.42
------------------------------------------------------------------------
and " 94.20 98.50 4.30 3.60 3.72 3.12
------------------------------------------------------------------------
and " 100.10 103.60 3.50 2.00 3.03 1.73
------------------------------------------------------------------------
and " 138.20 144.70 6.50 4.40 5.63 3.81
------------------------------------------------------------------------
and " 216.80 225.40 8.60 7.70 7.45 6.67
------------------------------------------------------------------------
and " 258.40 270.60 12.20 11.60 10.57 10.05
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05026 PCD/C 37.30 46.00 8.70 8.70 5.59 5.59
------------------------------------------------------------------------
and " 50.00 59.40 9.40 9.40 6.04 6.04
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05027 No significant coal seam intercept
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05028 PCD 57.00 69.10 12.10 Penetrated seam
sub-parallel to bedding
------------------------------------------------------------------------
and " 126.20 143.30 17.10 15.50 17.03 15.44
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05029 C 22.60 25.60 3.00 2.62 2.90 2.53
------------------------------------------------------------------------
and " 57.98 65.00 7.02 5.59 6.78 5.40
------------------------------------------------------------------------
and " 105.50 115.40 9.90 7.80 9.56 7.53
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05030 PCD 12.00 28.70 16.70 Seam thickness approximate,
cannot verify net coal
thickness
------------------------------------------------------------------------
and " 167.80 174.60 6.80 5.40 4.37 3.47
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05031 PCD 44.00 59.50 15.50 14.70 15.26 14.48
------------------------------------------------------------------------
and " 198.60 203.00 4.40 2.30 4.33 2.27
------------------------------------------------------------------------
305.50 318.00 12.50 9.00 12.31 8.86
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05032 PCD/C 45.20 49.10 3.90 3.90 2.99 2.99
------------------------------------------------------------------------
and " 99.00 103.20 4.20 3.90 3.22 2.99
------------------------------------------------------------------------
and " 109.10 117.30 8.20 6.50 6.28 4.98
------------------------------------------------------------------------
and " 120.00 129.80 9.80 7.20 7.51 5.52
------------------------------------------------------------------------
and " 136.20 144.20 8.00 6.70 6.13 5.13
------------------------------------------------------------------------
and " 147.94 164.00 16.06 11.06 12.30 8.47
------------------------------------------------------------------------
------------------------------------------------------------------------

Footnote (1): Calculated from measured (apparent) seam thickness and
measured (apparent) net-coal thickness using estimated seam attitude
(dip) and angle of bore hole. Seam attitude values are estimates based
on current understanding of sub-surface geology and structure.
Footnote (2): Coal seams listed in Table 1 are based on a 2-m cutoff,
estimated true thickness. Hole-Type Abbreviations: C = Core;
PCD = Poly-crystalline diamond; RC = Reverse circulation;

Table 2.
Location and Orientation of BN05021 through BN05032
------------------------------------------------------------------------
Drill
-Hole Elevation Local Plunge
Number Local Grid UTM Coordinates (masl) Grid UTM (degrees)
------------------------------------------------------------------------
Azimuth Azimuth
Easting Northing Easting Northing (degrees)(degrees)
------------------------------------------------------------------------
BN05021 37200 30295 519850 4828390 1586 0 335 -60
------------------------------------------------------------------------
BN05022 37200 30198 519892 4828302 1585 180 155 -60
------------------------------------------------------------------------
BN05023 37200 30825 519627 4828870 1593 180 155 -70
------------------------------------------------------------------------
BN05024 33897 30571 516741 4827245 1581 180 155 -55
------------------------------------------------------------------------
BN05025 33900 29975 516995 4826705 1566 180 155 -55
------------------------------------------------------------------------
BN05026 37201 30244 519873 4828344 1586 0 335 -70
------------------------------------------------------------------------
BN05027 33900 30100 516942 4826819 1568 0 335 -65
------------------------------------------------------------------------
BN05028 33910 30481 516791 4827168 1577 180 155 -50
------------------------------------------------------------------------
BN05029 37191 30395 519800 4828477 1587 180 155 -55
------------------------------------------------------------------------
BN05030 33910 30506 516780 4827191 1578 0 335 -55
------------------------------------------------------------------------
BN05031 33900 30359 516833 4827054 1575 180 155 -55
------------------------------------------------------------------------
BN05032 37200 30204 519889 4828307 1585 --- --- -90
------------------------------------------------------------------------


Mr. David Anderson, President/CEO of QGX Ltd., is the Qualified Person as defined by NI 43-101, and has reviewed and verified the results presented in this press release. Mr. Kirk Weber, Vice President of Norwest Corporation and a Qualified Person as defined by NI 43-101, has reviewed and approved the information contained in Table 1. 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.

QGX has retained the Mineral Services Division of SGS North America, Inc. (Denver, Colorado) to perform laboratory analyses of coal samples from the Baruun Naran exploration program.

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