FORT FRANCES, ONTARIO--(Oct. 23, 2008) - Q-Gold Resources Ltd. (TSX VENTURE:QAU) (FRANKFURT:QX9) (http://www.qgoldresources.com) announced that it has acquired an option from Bronco Creek Exploration Inc. ("BCE") to purchase a 100% undivided interest in the mineral and surface rights to mining claims containing two large Arizona porphyry copper prospects.
Arizona is the United States' leading copper producing state, with production worth over $5.5 billion in 2007.
The first prospect, "Courtland East", is located in Cochise County, approximately 15 miles north of the town of Bisbee, on the east side of the historic Courtland-Gleeson mining district, which produced high-grade copper/ gold ores from replacement bodies in Paleozoic sedimentary rocks. Using a new structural model BCE believes that large portions of a dismembered porphyry copper system in the district may lie to the east/ northeast of the historic district within the land position under option to Q-Gold. This consists of 4,995 acres of Arizona State Exploration Permits and 18 unpatented U.S. Federal Lode Mining Claims.
The second copper porphyry target, "Mesa Well", lies in Graham County along a regional trend of porphyry copper mineralization that stretches from the Safford District (Freeport McMoRan) to the San Manuel District (BHP-Billiton). The Mesa Well area is strongly enriched in metals including copper and gold. This is evidenced by the presence of numerous historic mines, prospects and outcrops with copper oxide mineralization along the western flank of the Pinaleno Mountains, which adjoins the optioned property to the East. The Mesa Well porphyry target lies just south of the Klondike District, a past producer of copper, lead and zinc mineralization from skarn and replacement deposits in limestones and porphyry-like occurrences.
The Mesa Well porphyry target was developed when a significant molybdenum anomaly (a minor but profitable constituent of most copper porphyries) was recognized in water well data from the property. Further investigation revealed a Laramide-Age dike swarm (a common feature of copper porphyries) exposed nearby in the Pinaleno Mountains projecting directly toward the molybdenum anomaly, enhancing the target. Copper oxide mineralization is exposed in faults developed along the projection of the dike swarm. The optioned property at Mesa Well encompasses 4,850 acres of Arizona State Exploration Permits. Both properties contain multiple, permitted locations which are ready to drill.
To obtain a 100% undivided interest in the Properties, Q-Gold has agreed to the schedule of cash payments, common share issuances, work commitments and advance royalty payments shown below, the initial cash payments of which have already been made. BCE is also entitled to a 2.5% Net Smelter Return ("NSR") production royalty.
Pursuant to the terms of the Option Agreement, Q-Gold can earn a 100% interest in each property by spending US$ 1.5 million in work, making cash payments totaling US$ 175,000 and issuing 500,000 common shares for each property over a three year period. Once the option is exercised, the properties will be subject to annual advance royalty payments of US$ 125,000 in September 2012 and 2013, increasing to US$ 150,000 and US$ 175,000 in 2014 and 2015, respectively, and US$ 200,000 annually thereafter. The annual advance royalty payments are creditable against BCE's NSR. In addition, the Company would issue an additional 1.5 million common shares to BCE for each property after exercising the option.
The Purchase Option Agreement is subject to the approval of the TSX Venture Exchange.
The optioned properties will be combined with previously announced optioned copper properties (see press releases dated August 26 and May 27, 2008) the "Ray" and "Troy" prospects and the Pinafore Mine, in a new 100%-owned subsidiary "Mineral Creek Copper Corp.".
President and CEO, Bruce Carruthers commented, "Although the copper price has dropped in the past few months, the long-term outlook is still favorable, with older, depleting mines, Asian demand and alternative energy requirements all pointing to long-term shortages of copper."
Brian A. Beck PG, CRS, Consulting Geologist, a Qualified Person as defined by NI 43-101, has reviewed and approved the technical disclosure contained in this press release.
About Q-Gold Resources Ltd.
Q-Gold is a Canadian-based mineral exploration company currently exploring for precious and base metals and platinum group elements on its extensive Ontario holdings in the historic Gold Camp at Mine Centre of 32,585 acres, including 5 historic gold mines. It also has options on 4,796 exploratory acres in the Rainy River Greenstone Belt. In addition, the Corporation holds options on six historic gold and silver mines near Crown King, Arizona and four prospective copper porphyries and one copper / zinc prospect in Arizona.
For all future Q-Gold investor relations needs, investors are asked to visit the Q-Gold IR Hub at http://www.agoracom.com/IR/Q-Gold where they can post questions and receive answers within the same day, or simply review questions and answers posted by other investors. Alternatively, investors are able to email all questions and correspondence to QAU@agoracom.com where they can also request addition to the investor email list to receive all future press releases and updates in real time.
The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially form the Company's expectations and projections.
SEC 12g 3-2(b) Exemption # 82-4931
The TSX Venture Exchange has not reviewed this press release and neither approved nor disapproved the information contained in this press release.
CONTACT INFORMATION:
Corporate Inquiries
Q-Gold Resources Ltd.
J. Bruce Carruthers II, President
1-888-779-0166
Website: www.qgoldresources.com
or
Investor Relations
AGORACOM Investor Relations
Email: QAU@Agoracom.com
Website: www.agoracom.com/IR/Q-Gold
