Brazilian Resources Option 70 percent of Sabara Gold Property to Placer Dome

Bnamericas Published: Friday, December 20, 1996
CONCORD, NEW HAMPSHIRE--Brazilian Resources, Inc. ("BRAZILIAN") announced today that it has entered into a binding letter agreement with Placer Dome (Brazil) Empreendimentos Ltda. ("Placer"), a subsidiary of Vancouver-based Placer Dome Inc., for Placer to acquire options to earn a seventy percent (70 percent) interest in BRAZILIAN's Sabara gold property. Under the terms of the agreement, BRAZILIAN may receive up to US$21,500,000 in option payments over the next two years. Then, BRAZILIAN will maintain a thirty percent (30 percent) interest in the property and be exempt from the first US$5,000,000 of work costs.

The Sabara property is located in a major mining district known as the Quadrilatero Ferrifero which is host to numerous gold deposits in banded iron formations. The concessions cover approximately 6,000 acres abutting Anglo American's Lamego mine, about 40 km east of Belo Horizonte, the capital of the state of Minas Gerais, Brazil. During the preceding fifteen months, BRAZILIAN's subsidiary BW Mineracao Ltda. completed two work programs on the property. Diamond drilling has defined a 328,000 ounce gold resource contained in Zones A and B ("the Core Area"), two of several target zones within the property.

The agreement with Placer is secured by Placer's payment of US$500,000 to an escrow, to be released to BRAZILIAN upon completion of the formal option agreements, which is expected to occur within sixty days. During the next two years, Placer will have the exclusive right to conduct exploration on the area surrounding the Core Area ("the Surrounding Area"), and may earn a 70 percent interest in the Surrounding Area by making additional option payments to BRAZILIAN totaling US$6,000,000 over that period of time. Upon exercise of the Surrounding Area option, Placer will be obligated to contribute the first US$5,000,000 of work costs.

BRAZILIAN intends to continue its exploration efforts on the Core Area, which, in 1997, will include diamond drilling to confirm and expand reserves and resources in Zone A, which is open at depth in the west. Placer may also earn a 70 percent interest in the Core Area. The base option price is US$9,000,000, and may reach US$15,000,000 if BRAZILIAN increases the total measured and indicated resource in the Core Area to over 500,000 ounces of gold.

According to Daniel R. Titcomb, President and CEO of BRAZILIAN, "Placer Dome Inc. is the sixth-largest gold producing company in the world, and is well known for the quality of its operating mines and exploration properties. We are very pleased that Placer has chosen our Sabara property as one of their initial acquisition targets in Brazil. As one of the first North American junior exploration companies to invest in Brazil, this deal confirms BRAZILIAN's ability to identify, acquire and explore properties with world class targets. We look forward to a long and prosperous relationship with Placer."

In addition to the Sabara property, BRAZILIAN owns 100 percent of the mineral rights to the Cedro Bom gold properties, two 10 km x 10 km concessions in the northern part of the state of Mato Grosso, Brazil. Results from the recently completed Phase II drilling and exploration program there should be available in January. BRAZILIAN also has rights to sixteen neighboring concessions of varying sizes totaling 325,000 acres, tracking 60 km along a major regional break, known as the Cachimbo Graben. These concessions are in the Juruena River region which has recently been the focus of intense exploration by several junior and senior mining companies.

BRAZILIAN is a gold and diamond exploration company quoted on the Canadian Dealing network under the symbol "BZIN". The company has been operating in Brazil for over four years.

BRAZILIAN's securities have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or resold in the United States or to a U.S. person absent registrati

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