ValGold Resources Ltd.

ValGold Resources Ltd.

November 09, 2010 11:27 ET

ValGold Announces Non-Brokered Flow-Through Private Placement Financing

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 9, 2010) - ValGold Resources Ltd. ("ValGold" or the "Company") (TSX VENTURE:VAL)(FRANKFURT:VR2) reports that, subject to regulatory approval, it will carry out a non-brokered private placement of up to 2,000,000 flow-through units (the "Units") at a price of $0.30 per Unit for gross proceeds of up to $600,000. Each Unit will consist of one flow-through common share and one non-transferable non-flow-through share purchase warrant (a "Warrant"). Each Warrant will be exercisable for one additional non-flow-through common share in the capital of ValGold for a period of two years from the date of issue at a price of $0.50 per share. The closing date of the offering is expected to be on or before November 15, 2010.

"We have realized strong share price appreciation with the successful exploration of our Garrison Gold Project in the Timmins Gold camp under the operatorship of Northern Gold Mining Inc.," commented Stephen Wilkinson, ValGold's President and CEO. "We believe that we can see much stronger market results on the basis of our own work on our 100%-owned Tower Mountain property that has demonstrated its excellent gold potential in our drill programs."

The gross proceeds from the sale of the Units will be used for Canadian Exploration Expenses ("CEE") within the meaning of the Income Tax Act (Canada) and the Company will use its best efforts to ensure that such CEE qualify as a "flow-through mining expenditure", for purposes of the Income Tax Act (Canada), related to the exploration of the Company's exploration project. The Company will renounce such CEE with an effective date of no later than December 31, 2010. The exploration budget is focused on ValGold's Tower Mountain Gold Property and contemplates two rounds of diamond drilling – an initial program of 2,000m scheduled to be completed in February 2011 and a follow-up program of 2,500m set for the spring.

All Units, shares, Warrants and any shares and/or warrants issuable upon the exercise thereof will be subject to a hold period and may not be traded for four months plus one day from the date of closing of the private placement.

The expiry date of the Warrants is subject to acceleration such that if, at any time after the date that is four months and one day following the closing date, the closing price of the common shares of the Company on the TSX Venture Exchange, or such other stock exchange or quotation system on which the Company's common shares are then traded, is not less than $1.00 per share for a period of 10 consecutive trading days (whether or not a trade occurs on any of such days), then the Company may elect to accelerate the expiry time of any unexercised Warrants by sending notice to the holders of the Warrants and the expiry time of the Warrants shall thereupon be deemed to be amended to 4:00 p.m. on the date that is the 30th day following the date of such notice.

Subject to regulatory approval, ValGold may pay finders' fees in association with this offering where upon closing the Company would pay each finder a cash commission equal to 5.0% of the gross proceeds received from the accredited investors found by the finder under the offering. In addition, the Company would issue to the each finder warrants (the "Finder's Warrants") which will entitle the finder to acquire that number of common shares of the Company, which is equal to 5.0% of the number of Units sold to the accredited investors found by the finder pursuant to the offering with each such Finder's Warrant to be exercisable to purchase one common share of the Company at a price of $0.30 at any time, and from time to time, on or before the date which is 24 months after the Closing Date.

Tower Mountain Gold Project Summary

Exploration work by ValGold on the Property began in November 2002 and has focused on diamond drilling. A total of eight drill programs comprising 75 drill holes, totalling 18,708m, have been completed to date.

The majority of drilling has been in the vicinity of the U and V Trench areas (U/V Zone) and this work has defined several mineralized structures. The most continuous of these structures is designated the Main Vein which dips moderately northeast and can be traced along strike for a minimum 400m. The Main Vein mineralized zone measures from 0.6m to 20.0m true width plunging steeply to the southeast. Drill intercepts from this zone returned assays ranging from 304.00 g/t Au over 3.0m in drill hole TM04-3 to 2.58 g/t Au over 55.5m in TM04-9.

Drilling has delineated additional zones of high-grade mineralization. The 04-31 Zone, located 800m southeast of the U/V Zone, appears similar to the U/V Main Vein. ValGold has tested this target with two holes with the best drill intercept returning 21.14 g/t Au over 1.5m. A hole drilled in 1996 by Avalon Ventures Limited in the vicinity of the 04-31 Zone was orientated sub-parallel to the zone and returned an average grade of approximately 0.3 g/t Au over its entire 739m length.

The third high-grade zone identified is the 04-36 Zone and is located 400m southwest of the U/V Zone. Two drill holes have intersected this zone. One hole documented 41.35 g/t Au over 1.5m and the second hole returned an assay of 5.31 g/t over 1.5m.

The following table summarizes the drill programs and presents highlights of each of the seven drilling campaigns conducted by ValGold.

Highlights of Tower Mountain Gold Property Drill Programs
Program Holes Drilled Total Meters Best High Grade Gold Intersection Best Low Grade Gold Intersection
2002 (Fall) TM02-01 to 05 1042 23.17g/tAu/1.5m in TM02-02 1.05g/tAu/73.5m in TM02-03
2003 (Spring) TM03-01 to 05 1085 11.77g/tAu/3.0m in TM03-02 1.01g/tAu/22.5m in TM03-03
2003 (Fall) TM03-06 to 12 1499 19.76g/tAu/1.5m in TM03-11 0.62g/tAu/12.0m in TM03-12
2004 (Winter) TM04-01 to 10 2601 304.0g/tAu/3.0m in TM04-03 2.40g/tAu/61.5m in TM04-09
2004 (Summer) TM04-11 to 23 3450 68.91g/tAu/0.2m in TM04-19 1.93g/tAu/37.5m in TM04-15
2004 (Fall) TM04-24 to 36 3418 41.35g/tAu/1.5m in TM04-36 0.94g/tAu/106.5m in TM04-31
2005 (Winter) TM05-37 to 50 3523 16.00g/tAu/1.5m in TM05-38 0.77g/tAu/21.0m in TM05-44
2007 (Summer) TM07-51 to 58 1661 4.97g/tAu/1.5m in TM07-55 0.73g/tAu/13.5m in TM07-55
Total 75 DDH 18,279    

Information in this news release that is of a scientific or technical nature was reviewed by Robert Chataway, P.Geo, who is a Qualified Person as defined in National Instrument 43-101.

A NI 43-101 compliant resource estimate for the U/V Zone was compiled by Caracle Creek International Consulting Inc. of Sudbury, Ontario. The report dated February 9, 2006 is filed on SEDAR. The resource for the U-V estimated to consist of 150,000 ounces within a bulk mineable volume. The zone is open to expansion on strike to the SE and at depth.

For more information on ValGold, the Tower Mountain Gold Project, and its international projects, please visit our website at

Stephen J. Wilkinson, President & Chief Executive Officer

This news release includes "forward-looking information". All statements in this release, other than statements of historical facts, that address the private placement or mineral exploration programs contain forward-looking information and are based on a number of assumptions, including, but not limited to, that there will not be substantial changes to market conditions, regulatory requirements or costs associated with mineral exploration. Although the Company believes the expectations expressed in such forward-looking information are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking information. Factors that could cause actual results to differ materially from those in forward-looking information include changes the price of the company's shares, the costs of labor, equipment and other costs associated with exploration, exploration successes, continued availability of capital and financing, 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.

SEC 12g3-2(b): 82-3339

Neither TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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