Rainy River Project Update
Wednesday, August 29th, 2007
Nelson W. Baker, President and CEO of Rainy River Resources Ltd. is pleased to report that the Company, as a result of its most recent financing with Canaccord Capital Corporation and Wellington West Capital Markets Inc., has over $40 million in its treasury with no debt. The funds raised through private placements and the exercise of warrants and stock options are placed into short-term interest bearing term deposits with Canadian banks until needed for exploration and administrative costs. The Company has not invested its surplus funds in any asset-backed commercial paper and has no exposure to the current market concerns over such financial instruments.
Since January 22, 2007, using three drill rigs supplied by Bradley Bros Ltd., the Company has completed a total of 49 drill holes, 43 of which have been drilled in Richardson Township 80 km south of Kenora, Ontario and 6 in the nearby Off Lake area, for a total of 25,073.40 metres. With much of the Company’s recent focus on tracing the 17 and ODM Zones down plunge below the 300 m level, the average depth of the 49 holes has increased to 511.7 metres, lowering productivity. Presently, the Company is awaiting the final results for a total of 11 holes that have been submitted for analysis.
To date, a total of six gold-dominant poly-metallic zones have been identified within the 6 km2 gold-in-bedrock anomaly centered in the southern half of Richardson Township. Of the six zones, five occur along the 3.1 km long 17 Gold Trend. The two most advanced gold zones, the contiguous 17 and ODM Zones, have been closely drilled along strike and down plunge to the 300 meter level and together demonstrate wide, consistent gold intervals for 800 metres along strike and to 520 meters down plunge. All old zones remain open at depth.
In April, the Company completed a 34-hole reverse circulation till and rock sampling program under the supervision of Overburden Drilling Management Ltd. north and south of the 17 Gold Trend between the Beaver Pond Zone and the West Zone. The results have indicated two potential new sub-cropping gold zones that have not been previously drill tested.
Presently, three drill rigs (i.e. two for 1,000 m holes, one for 1,500 m holes) are actively drilling in Richardson Township. A fourth drill, capable of drilling deeper than 2,500-metre holes, is scheduled to be mobilized to the property during the first week in September and will be dedicated to testing the down plunge extension of both the 17 Zone and ODM gold zones.
The 17 Gold Trend which hosts the 17, ODM, Beaver Pond and West Zones occurs within a magnetic low. Recent geophysical interpretation by the Company’s technical team suggests that this favorable stratigraphic horizon may be up to 7 km long as opposed to the previously quoted 3.1 km.
The Company has recently entered into five separate option agreements to earn a 100% interest in certain patented mineral rights totalling approximately 1485 acres in Richardson, Chapple and Sifton Townships. In consideration, the vendors will receive total cash payments of $500,000 ($100,000 each) and will be issued a total of 250,000 shares (50,000 each) over a five year period. These option agreements are subject to acceptance by the TSX Venture Exchange.
Since acquiring the Project, the Company has added 27,319.10 acres (11,055.65 hectares) in the form of option agreements, joint ventures and the outright purchase of freehold patents for an overall land package totaling 44,571.28 acres (18,037.36 hectares).