February 21, 2013
Calgary, Alberta
John E Squarek, President and CEO of MGold Resources Inc. ("MGold" or the "Corporation") is pleased to announce the completion of a third party independent engineering evaluation by the Resources Evaluation and Advisory Group of Deloitte LLP. This report covers the two proposed property acquisitions which were previously announced on November 16, 2012 and January 4, 2013. This evaluation has an effective date of March 31, 2013.
The report anticipates proved reserves before royalty of 676,200 BOE comprising 262,400 barrels of light oil and 2.48 bcf of natural gas. It also anticipates probable reserves before royalty of 1,470,000 BOE comprising of 475,200 barrels of light oil and 5.90 bcf of natural gas.
Together the proved and probable reserves of 2,154,700 BOE have an estimated net present value before tax discounted at 10% of $21,999,600. MGold currently has 42,444,024 shares issued and outstanding.
MGold expects to complete a private placement offering of convertible debentures in the principal amount of up to $3,000,000 to provide the financing for the acquisition of these properties as previously announced on January 31, 2013. The closing of the 2 proposed acquisitions and the convertible debenture private placement should occur on or before March 29, 2013. The completion of the 2 proposed acquisitions is subject to a number of conditions including, negotiation and execution of a definitive agreement, receipt of all required regulatory approvals, including approval of the TSX Venture Exchange and completion of due diligence investigations of MGold. It should be noted that the vales disclosed do not represent fair market value.