PRESS RELEASE
March 1, 2012, 8:00 a.m. EST
Brazilian Gold Acquires 100% Interest in Sao Jorge Gold Project
Brazilian Gold CorporationCA:BGC -7.69% ("Brazilian Gold" or the "Company") is pleased to announce that it has exercised the option to acquire a 100% interest in the Sao Jorge Gold Project ("Sao Jorge Project") from Talon Metals Corp. ("Talon") by accelerating its final payment under the option agreement dated June 14, 2010, as amended on February 17, 2012, (the "Agreement") between Talon, Brazilian Gold, Cabral Resources (B.V.I.) Limited, Seatrain Holdings Limited and Brazilian Resources Mineracao Ltda.
The Agreement was amended on February 17, 2012 to, among other things, provide that the final tranche of consideration payable under the Agreement would be $1,500,000 of Brazilian Gold shares based on the 20 day volume-weighted trading price of the Company calculated in accordance with the Agreement, in lieu of $750,000 in cash and $750,000 in Brazilian Gold shares.
To acquire the 100% interest in the Project, Brazilian Gold was required to pay Talon a total consideration of C$4,500,000 including C$1,500,000 in cash and C$3,000,000 in Brazilian Gold shares. Talon retains a 1% net smelter return royalty on the Sao Jorge Project. The net cost per resource ounce paid by Brazilian Gold to Talon was C$4.80/ounce based on the sum of the indicated mineral resource (11.365 million tonnes grading 1.0 g/t gold for 379,000 ounces of gold) and inferred mineral resource (20.673 million tonnes grading 0.8 g/t gold for 558,000 ounces of gold) at a 0.3 g/t cut-off (Coffey Mining, June 21 2011).
Ian Stalker, CEO of Brazilian Gold, stated, "Talon's willingness to exchange the cash consideration for shares of Brazilian Gold is a vote of confidence in the quality and potential of the Sao Jorge project, as well as our portfolio of nearby exploration projects in northern Brazil.
