Statement re Termination of Andina Acquisition

Medoro Resources Announces Termination of Andina Acquisition,

    Extension of Furtei Sale Closing

 

    TORONTO, Sept. 1 /CNW/ - Medoro Resources Ltd. (TSX-V/AIM: MRL) announced

today the termination of its proposed acquisition of Andina Minerals and that

it has granted Sargold Resource Corporation (TSX-V: SRG) a 5-day extension to

complete its due diligence related to the acquisition of the Furtei

operations.

    On June 7, 2004, the company announced the proposed acquisition of Andina

Minerals Inc. in exchange for 25 million common shares of Medoro, with closing

subsequently extended to August 31, 2004. As a result of market conditions,

the parties have mutually agreed to terminate further discussion of a possible

transaction.

    The company also announced on June 7, 2004 a proposed restructuring of

its Joint Venture whereby Sargold would acquire Medoro's entire interest in

the Furtei operations in exchange for (euro) 6 million in cash, the assumption

of (euro) 2 million in liabilities and C$1 million in common shares of

Sargold. Due diligence is nearing completion and the company has granted

Sargold a further 5 days to execute a definitive agreement.

    At the Monte Ollasteddu prospect, diamond drilling is underway with three

holes completed and four holes in progress, for a total of 610 metres in the

initial 3,000 metre programme. The drilling is testing three separate

mineralised structures in the western half of the prospect previously

identified by soil and rock chip sampling. Drilling to date has intersected

encouraging widths of quartz-sulphide veining in all of the drill holes and

visible gold recorded in some veins.

   

    For further information: Peter Volk, Assistant Secretary,

1 [phone], info(at)medororesources.com

    (MRL.)