LONDON, July 20, 2005 (PRIMEZONE) -- Dragon Gold Resources, Inc. (OTCBB:DRGO) ("Dragon Gold" or "the Company") is pleased to provide an update on the reconnaissance work carried out on its Olon Aarag property (L7551X) in the Gobi area in Mongolia.
The field work initiated on this property in late April included 312 kms of geological routing and sampling of 59 rock chips. In addition, 4 samples were taken for mineralogical testing and 9 samples were tested for clay minerals content by XRD. As a result of this program, an alteration area of 150 to 250 m wide and 2,000 m long was defined in north-east part of the property, namely "Serven Bayan Khoshuu" or "SBK area." In this area, alteration zones containing chalcopyrite and small quartz veinlets with malachitization occur in granodiorites with potassic and propilitic alterations with limited outcrops. Three trenches dug by previous explorers were recovered, and 11 channel samples were taken at 1.7 m to 2.0 m intervals. Assaying by SGS Mongolia showed that out of the 11 samples taken from this area, 9 samples have copper values of 0.17% - 2.4%, and two samples showed a gold value of 0.2g/t.
In the Central and Eastern part of the property, two quartz and quartz-breccia zones were delineated. In the Central quartz-vein zone, various-size quartz veins extend northeastward. The Eastern quartz-vein zone with weak hydrothermal alteration stretches northeastward between 500 to 800 m. Out of the fourteen rock chip samples taken from the latter zone, three samples showed Au content of 0.18 to 0.24 g/t and one sample returned a Cu value of 8.82%, although the remaining had Cu values under 0.1%.
Moving forward, the Company believes that the SBK area is of interest for further exploration work and it is now defining an exploration program that may include detailed geological mapping, geochemical sampling, and trenching to define mineralization in the SBK area. Depending on the results of such a program, further ground geophysical survey on the SBK area may be granted. More detailed rock and geochemical sampling in the eastern quartz vein zone is also being considered.
The "Olon Aarag" property, resting 450 km south-eastward of Ulaanbaatar, is located within the South Mongolian terrane or the South Gobi porphyry copper-gold belt. This region is known to host giant copper and gold deposits such as the Oyu Tolgoi deposit. The property is completely surrounded by Ivanhoe Mines properties, and it is close to the Bronze Fox District. The Company has the option to acquire 100% of the "Olon Aarag" license area as disclosed on our 8-K dated January 25th 2005.
Dragon Gold Resources, Inc. is a gold exploration company headquartered in London, United Kingdom. The Company focuses its exploration and minerals development activities in China and Mongolia. Both countries provide an ideal foreign investment climate given their untapped geological potential and favourable mining laws. Additional information can be found on the Company's website: www.dragon-gold.com.
On behalf of the Company; Johannes Petersen President
Safe Harbor for Forward-Looking Statements: This release contains certain "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, expectations, beliefs, plans and objectives regarding the potential transactions and ventures discussed in this release. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the risks inherent in gold exploration, the availability of needed personnel and equipment for future exploration and development, fluctuations in gold prices, and general economic conditions.