Virginia Gold Mines Inc.

Virginia Gold Mines Inc.

February 24, 2005 07:48 ET

Virginia Gold Mines Announces $12.0 Million Underwritten Private Placement Offering


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: VIRGINIA GOLD MINES INC.

TSX SYMBOL: VIA

FEBRUARY 24, 2005 - 07:48 ET

Virginia Gold Mines Announces $12.0 Million
Underwritten Private Placement Offering

QUEBEC CITY, QUEBEC--(CCNMatthews - Feb. 24, 2005) - This press release
is not for distribution to United States newswire services or for
dissemination in the United States.

Virginia Gold Mines Inc. (TSX:VIA) ("Virginia") is pleased to announce
that it has entered into an agreement with a syndicate of underwriters
co-lead by Orion Securities Inc. and BMO Nesbitt Burns Inc. pursuant to
which the underwriters have agreed to purchase 2,930,000 Units, at a
price of $4.10 per Unit for gross proceeds to Virginia Gold of
approximately $12,013,000 million. The Underwriters have the option up
to 48 hours prior to closing to purchase up to an additional 1,000,000
million Units at the issue price of $4.10 per Unit at any time prior to
the closing of the offering. Each Unit will consist of one common share
and one-quarter of one common share purchase warrant. Each whole common
share purchase warrant will entitle the holder to purchase one common
share at a price of $5.40 for a period of 18 months following the
closing of the offering.

The offering is scheduled to close on or about March 10, 2005 and is
subject to certain conditions including, but not limited to, the receipt
of all necessary approvals including the approval of the Toronto Stock
Exchange.

The securities offered have not been registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or sold in
the United States absent registration or exemption from the registration
requirements. This press release shall not constitute an offer to sell
or the solicitation of an offer to buy nor shall there be any sale of
the securities in any State in which such offer, solicitation or sale
would be unlawful.

Virginia Gold Mines Inc. is among the most active mining exploration
companies in Quebec with a working capital of over $15 million, debt
free, and with approximately 38 million shares issued and outstanding.
Virginia's shares trade on the Toronto Stock Exchange (TSX) under the
symbol VIA. Virginia concentrates its activities on its numerous
properties that are spread over the vast unexplored regions of northern
Quebec.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Virginia Gold Mines Inc.
    Andre Gaumond
    President
    (800) 476-1853 or (418) 694-9832
    (418) 694-9120 (FAX)
    or
    Virginia Gold Mines Inc.
    Paul Archer
    V.P. Exploration (QP)
    (800) 476-1853 or (418) 694-9832
    (418) 694-9120 (FAX)
    or
    Virginia Gold Mines Inc.
    Amelie Laliberte
    Investor Relations
    (800) 476-1853 or (418) 694-9832
    (418) 694-9120 (FAX)
    Email: mines@virginia.qc.ca
    Web : www.virginia.qc.ca