Merc Completes Acquisition of Colomac Gold Mine

    




 TORONTO, Jan. 26, 2012 /CNW/ - Further to its press release dated  December 15, 2011, Merc International Minerals Inc. ("Merc")  is pleased to announce that it has completed the  acquisition of a 100% interest in the mineral claims and leases (the "Colomac Property"), including those of the former producing Colomac Gold Mine in the  Northwest Territories ("NWT") from Aboriginal Affairs and Northern Development Canada ("AANDC"). 

 Highlights: 




        --  Includes the past producing Colomac Gold Mine, four surrounding
            gold deposits, and several gold showings;

        --  Historical, non-NI 43-101 compliant gold resource ranging from
            approximately 750 thousand to 1.1 million ounces of gold ("oz
            Au") (See Table 1 for further details; cut-off grades are
            unknown);

        --  A NI 43-101 technical report and mineral resource estimate for
            the Colomac Property, is currently being completed by ACA Howe
            International Ltd. and is expected to be finalized in the first
            quarter of 2012; and

        --  Historic drilling at the Colomac Gold Mine from 1997 indicates
            the presence of a high-grade gold shoot to a depth of over
            1,000 metres and an extension of mineralization beneath the pit
            to a vertical depth of 700 metres.




 David Wiley, Merc President and CEO, remarked, "We are excited to have  completed the Colomac acquisition and that Merc now controls over 90%  of the Indin Lake Gold Camp. We are encouraged by the historic resource  estimates, which we discovered during the due diligence process for the  acquisition, and believe we have made an attractive acquisition. We  will be working on a NI 43-101 compliant resource estimate in the near  future, and we expect the winter 2012 drill program to commence in  March. Now that we have closed the transaction, our objective will be  to expand known zones of mineralization to depth and along strike, and  begin remediating the historic reclamation sites." 

 Acquisition Terms 

 In consideration for the conveyance of the Colomac Property, Merc will  commit to reclaim three disturbed historic exploration sites not  associated with the Colomac Property. Reclamation will be carried out  on behalf of AANDC to a maximum of $5,000,000. Merc will not be  assuming the reclamation liabilities directly. Merc is not responsible  for any historical environmental liabilities associated with Colomac. 

 Colomac Opportunity 

 The Colomac Property represents a rare opportunity as a past producer  and under-developed gold deposit with exploration potential. Merc  believes there is an opportunity to develop resources at the Colomac  Property (as historic open pit mining was limited to less than 200  metre vertical depths and only one of five known deposits was  developed). All deposits at Colomac remain open to depth and laterally. 

 The Main Deposit on the Colomac Property was not mined out when  production ceased in 1997. Perennial low gold prices and operational  difficulties ultimately lead to the termination of mining at the  Colomac Property. Merc believes a resource remains that has the  potential to be expanded by drilling known mineralization to depth and  along strike, as well as by exploring for high-grade plunging gold  shoots that are known to exist, plunging over 1,000 metres to depth. 

 Table 1 below summarizes historical, non-NI 43-101 compliant resource  estimates sourced from public documents and internal company reports;  these estimates should not be relied upon. Merc has not independently  verified these numbers nor does it propose that they should, in any  manner, be viewed as a current mineral resource or mineral reserve.  A  Qualified Person as defined in NI 43-1010 has not done sufficient work  to classify the historical estimate as current mineral resources or  mineral reserves.  These historical numbers are presented in support of  the position that the deposits were not mined out, and as such,  opportunities exist to build upon what may have been left.  Merc is not  treating the historical estimates as current mineral resources or  mineral reserves. 

 Table 1. Colomac Historic, Non-NI 43-101 Compliant Resource Estimates 





                                                                  

    Year      Source   Short Tons  Grade     Oz Au   Subsequent  Net Oz Au
                         of Ore   (oz/ton) Resource  Oz Au Mined Resource
                                           Estimate              Estimate2

    1988     Energy,   27,000,000   0.060  1,680,000    527,908  1,152,098
            Mines and
            Resources
             Canada,
             Mineral
            Bulletin,
               223

    1990  The Northern 28,100,000   0.056  1,573,600    527,908  1,045,692
             Miner

    19951  Royal Oak   16,692,000   0.052   860,400     108,678   751,722
           Mines Inc.






 (1)Estimates are based on a Royal Oak Mines Inc. ("Royal Oak") report written in 1995 that projected the ore reserve as at December  31, 1996.  Subsequently, Royal Oak mined 108,678 oz Au in 1997. (2) Merc has not independently verified these numbers nor does it propose  that they should, in any manner, be viewed as a current mineral  resource or mineral reserve. No information is available for the  cut-off grades used to calculate these estimates. 

 Royal Oak 1997 Drilling at Colomac 

 During its last year of operation at Colomac, 1997, Royal Oak drilled 21  holes following up on a near surface intersection of 1.08 ounces per  ton gold over 4 metres in Zone 3.5. Drilling pursued a higher grade  mineralized shoot plunging 70 degrees to a depth of 1,000 metres. This  represented the first discovery and definition of a high-grade  mineralized feature within the host Colomac Dyke. The presence of  recently discovered high-grade shoots significantly increases the  exploration potential of the dyke. Merc intends to aggressively pursue  these plunging shoots in its upcoming drill program. 

 In 1997 Royal Oak also tested the dyke below Zone 2.0, the zone that  accounted for the majority of production at Colomac. A single hole was  drilled below the Zone 2.0 pit 2,000 metres north of Zone 3.5, and it  intersected the dyke 500 metres below the bottom of the pit (reporting  a 120 metres intersection of 1.30 grams per tonne gold). The 1997 deep  drilling has confirmed that the Colomac Dyke continues uninterrupted to  depth, the dyke maintains significant mineralized widths, the grade of  mineralization appears consistent, and a high-grade gold shoot exists  within the dyke and represents one of the most exciting target  opportunities yet to be explored. 

 Given its robustly mineralized characteristic, Merc believes that  Colomac continues to represent an under-explored opportunity with the  potential to develop and expand resources throughout the five known  deposits. 

 About The Colomac Property 

 The Colomac Property lies within the central portion of Merc's 94,701  hectare Indin Lake property, 220 kilometres northwest of Yellowknife,  NWT. Access is by winter road from Yellowknife or year round by  chartered aircraft to a 5,000 foot airstrip at the former Colomac Gold  Mine site. With this acquisition Merc has secured a contiguous land  position fully surrounding the Colomac Property, and consolidated  greater than 90% of the Indin Lake Greenstone Belt including the  related Indin Lake Gold camp. The Colomac Property contains at least  five separate gold deposits open in all dimensions (Colomac Main,  Grizzly Bear, Goldcrest, Dyke Lake, and 24/27), only one of which, the  Colomac Main Deposit, was historically mined. Intermittent mining from  1990 to1997 was limited to three shallow open pits developed on a  steeply dipping quartz-feldspar porphyry intrusion (Colomac Dyke).  Historical production is reported to be 527,908 ounces of gold with an  average head grade of 1.66 grams per tonne (see Table 2). Mining  activities impacted only a small portion of the dyke's 7 kilometre  mineralized strike length. 

 Table 2. Colomac Production History 





                                                           

     Year   Ounces     Tonnes    Head    Recovery  Cash   Average
           Produced    Milled    Grade            Cost/oz  Gold
                               (g/tonne)           (US$)   Price
                                                           (US$)

    1990    64,500  1,040,000     1.89      90%      300     384

    1991    74,100  1,131,000     2.19      94%      NA      362

    1994    40,568    985,091     1.58      87%      NA      384

    1995   117,646  2,725,388     1.61      92%      383     384

    1996   122,416  3,013,156     1.58      87%      370     388

    1997   108,678  2,906,081     1.51      85%      354     331

    Total: 527,908  11,800,716    1.66      89%                






 General Geology 

 Colomac lies within a north striking, steeply dipping, Archean  greenstone belt of deformed sedimentary and intermediate to ultramafic  volcanic rocks. Deposits appear in two distinct geological settings  with the Colomac Main, Goldcrest, and Dyke Lake deposits hosted within  quartz-feldspar porphyry dykes, whereas the Grizzly Bear and 24/27  deposits occur near or within the sedimentary/volcanic rock contact. 

 Colomac Main Deposit 

 The Colomac Main Deposit occurs within a north-south striking,  quartz-feldspar porphyry dike approximately 7 kilometres long and 50  metres wide bounded by diorite and andesite. Mineralization is  predominantly free gold spatially associated with quartz-carbonate  veining and minor sulphides. During deformation, the dyke behaved as a  competent unit enclosed within more ductile rocks, thus representing  the classic competency contrast condition present in many Archean lode  gold camps. This has led to the preferential emplacement of  gold-bearing veins within the quartz-feldspar dyke. 

 Grizzly Bear Lake and 24/27 Deposits 

 These three deposits are typical of many gold deposits within the Indin  lake Greenstone Belt. Like the Treasure Island and North  Inca-Diversified deposits, the Grizzly Bear Lake and the 24/27 deposits  are located at a fault related volcanic rock sedimentary rock contact  exhibiting considerable shearing. Gold mineralization is characterized  by quartz stringers associated with silicification and carbonatization  within volcanic rocks adjacent to the steeply dipping north-south  volcanic/sedimentary rock contact. 

 About Merc International Minerals Inc. 

 Merc is a Canadian-based exploration company focused on acquiring and  developing gold mineral properties in the NWT. Its primary land  position covers 234,013 acres or 94,701 hectares in the Indin Lake Gold  Camp, located approximately 220 kilometres north of Yellowknife, NWT. 

 The technical information in this news release was reviewed and approved  by Merc Director, Dr. Michael J. Byron, a Qualified Person under NI  43-101. Historical information was obtained from previous Royal Oak  Reports, The Northern Miner, and Northwest Territories Geoscience  Office. 

 Neither TSX Venture Exchange nor its Regulation Services Provider (as  that term is defined in the policies of the TSX Venture Exchange)  accepts responsibility for the adequacy or accuracy of this release. 

 Forward-Looking Statements 

 Certain information set forth in this news release may contain  forward-looking statements that involve substantial known and unknown  risks and uncertainties, including, but not limited to, the timing of  future drilling, the expansion of the mineralization, the remediation  of historic reclamation sites, the completion of a NI 43-101 compliant  resource. These forward-looking statements are subject to numerous  risks and uncertainties, certain of which are beyond the control of  Merc, including, but not limited to, the impact of general economic  conditions, industry conditions, volatility of commodity prices, risks  associated with the uncertainty of exploration results and estimates,  currency fluctuations, dependency upon regulatory approvals, the  uncertainty of obtaining additional financing and exploration risk.  Readers are cautioned that the assumptions used in the preparation of  such information, although considered reasonable at the time of  preparation, may prove to be imprecise and, as such, undue reliance  should not be placed on forward-looking statements. This press release  is not, and is not to be construed in any way as, an offer to buy or  sell securities in the United States. 

   

   

Merc International Minerals Inc.


CONTACT:  David Wiley, President and CEO     Daniel Boase, Investor RelationsMerc International Minerals Inc.   First Canadian Capital Corp.[phone]                     [phone] ext 232 [phone] (FAX)               email: [e-mail]: [e-mail] 


    

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