Uragold Signs Agreement for the Asbury Graphite Mine and the Canadian Graphite Property

MONTREAL, QUEBEC–(Marketwire – March 23, 2012) – Uragold Bay Resources Inc. (TSX VENTURE:UBR.V – News), Uragold is pleased to announce it has signed an agreement with a private vendor regarding the acquisition of 100% interest in two large flake graphite properties, the Asbury Graphite Mine and the Canadian Graphite property.
Asbury Graphite Mine: The property, located in Notre-Dame-de-Laus, 60 km south of Mont-Laurier, Quebec consists of two claims, which holds the former Asbury Graphite Mine. The mine was an open pit mine that operated seasonally from 1980 to 1989, and less then 70,000 tons were process during that period. In 1974 a historic estimate of 578,000 tons averaging 10% large flake graphite was reported for the Ashbury Graphite Mine (source is pre 43-101, Resource Naturel et de la Faune du Quebec, report GM36039, FEASIBILITY STUDY ON THE MINING OPERATION OF THE GRAPHITE PROPERTY, Baril 1974, by Canastota Mines)
A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves; and Uragold is not treating the historical estimate as current mineral resources or mineral reserves.
Additionally, a 1985 drilling program confirmed the presence of graphite beds at the bottom of the pit open at depth, indicating an additional deposit of significant potential. Graphite zones to the north and south of the open pit show the potential of additional ore discoveries.
Drilling Highlights (Pre-43-101, source Drill Logs, Asbury Project GM 41533, Raincourt 1985)
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Hole Interval (m) % C
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M27 (in pit) 45 9.79%
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M28 (in pit) 25 10.11%
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M29 (in pit) 19 7.2%
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M30 (in pit) 14 8.63%
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M31 (in pit) 13 7.01%
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M25 (south) 12 4.03%
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M24 (north) 3 9.78%
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A qualified person has not verified the relevance and reliability of the 1985 drill results outlined above and should not be relied upon until the Company can confirm them.
Past metallurgical tests on bulk samples from the deposit have shown that a graphite concentrate with a recovery of 85% was produced where by 50% of the concentrate fall into the large flake grade with an average carbon content of 90% and a granulometry of 80 plus mesh. 25% fall in the medium flake category with an average carbon content of 80% carbon and a granulometry between minus 80 mesh and plus 200 mesh. The remaining 25% fall in the fine flake category and had an average carbon content of 80% and a granulometry of minus 200 mesh. (source: metallurgical tests are pre 43-101, report GM36039, Baril 1974)
A qualified person has not verified the relevance and reliability of the 1974 metallurgical results outlined above and should not be relied upon until the Company can confirm them.
The area is underlined by Grenville formations. The main graphitic formations are layered units of biotite – graphite gneiss
Located on the property is an abandoned 9,000 tons per year graphite mill. It was last upgraded in 1989 and leased by Stratim (Timcal) until a new mill at the Lac-des-iles graphite mine was opened 1991. The municipality of Notre-Dame-de-Laus has informed Uragold that the mill buildings are still on site and have a municipal evaluation of $56,000, however, they have not been cared for since 1991.
Canadian Graphite Property: The property consists of two mining claims located 13 km east of St-Michel-de-Wentworth in the Laurentian region of Quebec. In 1918, the Canadian Graphite Company identified a graphite historical estimate of 168,000 tons at 6.15% graphite (source is pre 43-101, Canadian Graphite Co., Hitchcock 1918). Recently, a 30498 (Territoire affecte a la villegiature) exploration and mining restriction was imposed on the region. Future exploration activities will require authorization from the municipality of Wentworth Nord.
A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves; and Uragold is not treating the historical estimate as current mineral resources or mineral reserves.
Mr. Vivian Stuart-Williams, (SACNASP), a Director of the Company and a Qualified Person as defined by National Instrument 43-101, supervised the preparation of the information in this news release.
Material terms of the agreement are as follows (all amounts are expressed in Canadian dollars). In order to acquire its interest in the claims, the Company shall make the following payments to the vendor.
The Vendor agrees to grant Uragold the exclusive and irrevocable right to earn a one hundred per cent (100%) interest in the Claims, in consideration of 8,000,000 common treasury shares of the Company plus a cash payment of $50,000.00
The transaction is made with a party that is non-related to the Corporation. The acquisition is conditional to the approval of regulatory authorities. Further to the acquisition and its approval, the parties will proceed with the transfer of the titles of the claims to the Corporation.
About Graphite
The price of large-flake graphite has tripled over the last five years due to reductions in supply and increased demand. High grade large-flake graphite sell for up to $3,000 a ton. Lithium ion batteries are composed of 10 to 20 times more graphite than lithium. Focus metals Lake Knife project has a 16% graphite content and is the highest known graphite grade in the world. Other known global deposits are typically in the 2-6% range. At 10% graphite, the Asbury Mine has the potential to be a world class deposit.
Patrick Levasseur, president and COO of Uragold stated. “The Asbury project is similar to our Beauce Placer project, this property benefits from extensive historical exploration work, well-established infrastructure and the real potential of developing a mining operation. I am confident that this major graphite acquisition will add to shareholder value.”
About Uragold Bay Resources Inc.
Uragold Bay Resources is a junior exploration company trading on the TSX Venture Exchange under the symbol UBR. Uragold is a top claims holder in Southern Quebec’s Appalachian belt. The properties benefit from extensive historical exploration work and from well-established infrastructure thereby helping to reduce exploration risks. Uragold’s business model focuses on developing, a series of potential small scale low-cost gold mining operations for their potential in generating cash flow while simultaneously exploring core properties that hold the potential for the discovery of blue sky gold deposits like the MacDonald project.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.