Silver Quest Acquires Properties in White Gold Area


Silver Quest Resources Ltd. has signed option agreements with Hinterland Metals Inc. and three private individuals to acquire a 100-per-cent interest in both the CC and the TAK gold properties. Both the properties are located in the newly recognized White Gold area, approximately 120 kilometres south of Dawson City, Yukon.

Pursuant to two separate option agreements, the company can acquire a 100-per-cent interest in each property for cash payments of $60,000 ($15,000 upon signing), the issuance of 800,000 shares (200,000 upon signing) and work commitments of $500,000 ($50,000 in the first year) over a three-year period. The vendors retain a 2-per-cent-net-smelter royalty (NSR) on each property, with the company having the right to buy back 1 per cent of each NSR for $1.0-million within three years of the exercise of the option. In addition, should the company complete a 43-101-compliant resource estimate on either property in excess of 100,000 ounces of gold in an indicated category, the company will be required to make a one-time payment of $100,000 and issue an additional 75,000 shares to the vendors.

The principal target on each property is a near-surface, bulk tonnage gold deposit similar to new discoveries on Underworld Resources Inc.’s White Gold property. Underworld has identified two deposits, including the Golden Saddle zone with intercepts of 3.39 grams per tonne gold over 104 metres in hole WD09-31, and 3.16 grams per tonne gold over 44.5 metres in hole WD09-32, and the Arc zone which returned 1.51 g/t Au over 78 metres in holes WD09-39.

The CC property comprises 32 claims (665 hectares) and is strategically located between Underworld’s Thistle and Black Fox properties, approximately 20 kilometres southeast of the Golden Saddle deposit. The claims, located due east of Kaminak Gold Corp.’s Kirkman property, cover the ridge between Kirkman Creek to the south and Lulu Creek to the north. Lulu Creek drains into Thistle Creek, an area that has been active in placer gold production since 1978 and has produced in excess of 63,000 ounces of gold (Yukon Geological Survey Records, 2008).

The TAK property comprises 16 claims (332 hectares) and is located approximately 40 kilometres southeast of Underworld’s Golden Saddle discovery, approximately 20 kilometres southeast of the CC property. Based on the knowledge and experience of one of the vendors of both placer and hard rock gold mineralization in the district, the company has staked an additional 66 claims (1,398) to be included in the property. The property is interpreted to be underlain by a coarse-grained leucocratic quartz monzonite to syenite, within the regional gneiss units. The claims are staked to cover the drainage basin of a silt sample taken by one of the vendors, which returned 70 parts per billion gold from a fine sieved fraction of the sample. This sample is interpreted to be strongly anomalous for gold.

Silver Quest is pleased to have acquired these strategically located and prospective properties in this emerging gold area. A summer 2009, exploration program will include geological mapping, geochemistry and trenching, directed at the definition of drill targets. Robert Weicker, PGeo, is the qualified person as defined by National Instrument 43-101 for these projects and has verified and supervised preparation of the scientific and technical information in this release.

The agreements are subject to regulatory acceptance and all securities issued pursuant to the agreements will be subject to a four-month hold period trading restriction from the date of issuance.

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