Reunion Gold Corporation

Reunion Gold Corporation

August 28, 2006 11:42 ET

Reunion Gold Corporation Announces its Financial Results for the First Quarter Ended June 30, 2006 and an Option Grant

LONGUEUIL, QUEBEC--(CCNMatthews - Aug. 28, 2006) - Reunion Gold Corporation (the "Company" or "Reunion Gold") (TSX VENTURE:RGD) announces its financial results and presents its MD & A for the quarter ended June 30, 2006 which are available through CCNMatthews' website at They are also available on the Company's website ( and on Sedar (

In January 2006, the Company acquired the right to explore, develop and acquire the Antino 1 Project located in Suriname (the "Option Agreement") and in April 2006, the Company elected to continue with the Option Agreement following an agreed-upon 90-day due diligence period. During this period, a number of potential targets on the Antino 1 property were identified that were not previously known. Important among these is the Maripasoula Creek target where extensive small miner activity on the margins of an intrusive body was encountered. The existence of this style of mineralization had not previously been identified at Antino 1.

Highlights of the period ended June 30, 2006

- The completion of the sale of the Company's interest in the
Sleeper Project, located in Nevada, USA, to X-Cal Resources Ltd.
("X-Cal"); the Company received on May 16, 2006 a cash amount of
$5,000,000 and 10 million shares of X-Cal.

- The Company changed its name from New Sleeper Gold Corporation to
Reunion Gold Corporation, following the sale of the Sleeper
Project and the acquisition of the Antino 1 Project in Suriname.

- A gain of $600,000 was recorded during the quarter, resulting from
the increase in value of the shares held in X-Cal, from $3.1
million at March 31, 2006 to $3.7 million at May 16, 2006, the day
of the closing of the sale agreement with X-Cal.

- Exploration expenditures of $179,500 were incurred on the Antino 1

- Results of Operations directly attributable to the Sleeper Project
during the first quarter ended March 31, 2006, including the gain
of $600,000 from the increase in value of the shares held in X-
Cal, were classified as Discontinued Operations (with comparative
numbers reclassified accordingly).

- For the period ended June 30, 2006, the Company incurred a loss
from continued operations of $243,000 compared to earnings of
$29,100 in 2005. Earnings in the period ended June 30, 2005
included a gain from foreign exchange of $235,500.

- Including the impact of the Discontinued Operations, which
amounted to a profit of $476,000 in the first quarter of 2006 and
a loss of $258,800 in the corresponding period in 2005, net
earnings for the period amounted to $233,000 or $0.01 per share
compared to a net loss of $229,600 or $0.01 per share in 2005.

- Total assets of $9,148,600 at June 30, 2006 included cash and cash
equivalents of $5,073,700 and an investment of $3,700,000 in
shares of X-Cal.

- The Company has 37,798,691 common shares issued and outstanding as
at August 25, 2006; it also has 20,445,540 warrants outstanding at
an exercise price of $1.25 per share and expiring at various dates
up to February 2009 and 3,225,00 outstanding stock options with an
exercise price varying between $0.20 and $1.00 and expiring by
December 2010.


- The exploration program at the Antino 1 gold property is being
focused on the Maripasula Creek target in the southern part of the
Concession. The exploration program is to include grid based auger
soil geochemistry, excavator trenching followed by reverse
circulation drilling. Geological mapping, reprocessing of airborne
magnetics and radiometrics data plus acquisition and
interpretation of satellite imagery will also be undertaken. The
necessary equipment for these programs is currently being
transported to Antino 1, including a drill rig for the anticipated
RC drilling.

- The Company estimates that an amount of approximately US $2.0
million will be required in the first phase of the program, the
objective of which is to define the extent and grade of gold
mineralization within the Maripasula target area.

- From this point on, the Company intends to focus its attention on
the Antino 1 Project in Suriname and on other projects in the
Guiana Shield in South America. The Company is actively looking
for new opportunities and anticipates the acquisition of
additional projects in the Guiana Shield.

- The Company currently has cash of approximately $5.0 million and
no debt.

- The Company has no cash flow generating operations and its long-
term financial success is highly dependent on management's ability
to discover economically viable deposits. The Company has
sufficient capital resources to initiate its exploration program
on the Antino 1 Project. However, the Company may be required to
raise capital through the issuance of additional equity in order
to finance new acquisitions and exploration programs on newly-
acquired exploration properties. Although the Company has been
successful in the past in obtaining such financing, there can be
no assurance that it will be able to obtain adequate financing in
the future or that the terms of such financing will be favorable.

Option grant

On August 24, 2006, the Company granted to one of its officers an option to purchase 50,000 common shares of the Company at a price of $1.96 per share. The option is for a five-year term expiring on August 24, 2011.

Forward Looking Statements

Except for historical information, this press release may contain forward-looking statements. Forward-looking statements are not historical facts, and are subject to a number of known and unknown risks and uncertainties beyond the Company's control; uncertainties related to raising sufficient financing to fund the planned work in a timely manner and on acceptable terms; the possibility that required permits may not be obtained in a timely manner or at all; changes in planned work resulting from weather, logistical, technical or other factors; potential resources, exploration results, costs and supply of material relevant to the mining industry, and future plans and objectives of the Company. These statements may cause the actual results, levels of activity, performance or achievement of the Company to be materially different from any future results, levels of activity, performance or achievement expressed or implied by these forward looking statements.

Additional information

Additional information about the Company is available through regular filings and press releases on SEDAR and on the Company's website.

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

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