August 12, 2013

Sanatana Reports Drill Results and Announces Staking of Additional Mining Claim

Vancouver, British Columbia, Canada, August 12, 2013. Sanatana Resources Inc. ("Sanatana" or the "Company": TSX-V: STA) announces drill results on its recently acquired interest in mining claims 4240522, 4241016 and 4220425 (the "Mining Claims") and the staking of an additional mining claim in Chester Township, Ontario.

Peter Miles, Chief Executive Officer of Sanatana stated, with respect to the drill results: "During our 2012 drilling program, seven of Sanatana's drill holes on the Watershed Property inadvertently extended to one of the mining claims included in the recently acquired land package and included a mineralized intersection of 17.9 metres at 1.07 g/t Au from the claim boundary. Other drill holes were terminated in gold mineralization. The Company views these mineralized intervals as important as they give us more information about the nature and extent of the mineralization on or near mining claim 3011820. In fact, the drill results were a strong factor in deciding whether to exercise our rights under the area of interest to acquire the interest in the mining claims." With respect to the staking of an additional mining claim in Chester Township, Mr. Miles stated: "We are pleased that we were able to stake an additional mining claim in Chester Township. This additional mining claim is 100% owned by Sanatana and complements the Watershed Property."

Drill Results

During the drill program for mining claim 3011820 (see Sanatana's news release dated May 15, 2013) Sanatana inadvertently drilled seven holes beyond the limits of mining claim 3011820 in the sub-surface to the south (Table 1). This occurred because the drill holes deflected off their planned path during drilling and the amount of deflection was not known until a survey of the holes was completed. The off-property drilling extended on to mining claim 4220425, which was then held jointly by Trelawney Mining and Exploration Inc. ("Trelawney") (80%) and Crown Gold Corporation ("Crown Gold") (20%) and is now held jointly by Trelawney (80%) and Sanatana (for the benefit of Sanatana and Trelawney Augen Acquisition Corp. ("TAAC")) (20%). Intervals of gold mineralization were also encountered in this drilling (Table 2). Sanatana informed Trelawney and Crown Gold of such drilling and supplied them with the drill data in conformity with standard protocols. Having acquired the 20% interest in the Mining Claims for the benefit of Sanatana and TAAC, Sanatana views such drilling results for mining claim 4220425 as material and that disclosure is necessary for observance of applicable laws and stock exchange listing requirements. The drill results are summarized below.

Table 1:

Hole From To Interval
SR-12-24 465.0m 500.9m 35.9m
SR-13-01 273.0m 303.0m 30.0m
SR-13-02 189.0m 207.0m 18.0m
SR-13-03 270.0m 303.0m 33.0m
SR-13-04 186.0m 201.0m 15.0m
SR-13-05 93.0m 102.0m 9.0m
SR-13-06 414.0m 462.9m 48.9m

Table 2:

Hole From
SR-12-24 478.0 479.0 1.0 0.61
SR-12-24 498.9 500.9 2.0 1.33
SR-13-01 277.0 294.9 17.9 1.07
SR-13-01 284.4 285.4 1.0 5.61
SR-13-01 294.0 294.9 0.9 7.01
SR-13-02 190.0 191.0 1.0 0.34
SR-13-02 206.0 207.0 1.0 0.31
SR-13-03 270.0 271.0 1.0 0.65
SR-13-03 274.0 275.0 1.0 0.36
SR-13-04 186.0 201.0 15.0 0.54
SR-13-05 97.0 98.0 1.0 0.30
SR-13-06 434.0 435.0 1.0 0.37

  1. True widths of intersections are unknown at this time.
  2. Mineralized intervals are calculated using the weighted Au average based on length of sample, a lower cut-off of 0.3 g/t Au and an upper cut-off of 25.0 g/t Au, including low grade zones no greater than 20 metres in length.
The gold mineralization observed in these drill intercepts shares many similarities to mineralization within mining claim 3011820 (the "Clam Lake prospect") and Trelawney Mining and Exploration Inc.'s Côté Gold Deposit as has been publicly described and presented previously. Like the Côté gold system, the Clam Lake prospect has gold mineralization hosted in intrusive breccias associated with silicification, potassium and sodic alteration with accessory copper, molybdenum and telluride mineralization. Some of the higher-grade intervals are associated with calcite quartz sulphide veins within the breccias however there are also many examples of barren veins of similar nature.

All but three drill holes (SR-13-01, -04 and -05), intersected barren diabase dykes that were intruded after the gold mineralization event. These occurrences of diabase rocks detract from the potential of intersecting gold mineralization in the prospective host country rocks or cause gaps in otherwise gold mineralized intervals. It is probable that in most cases the drill holes intersected many of these dykes sub-parallel to their strike. The gold mineralization remains open on the property and into other parties' ground to the east, west, north and south. The Mining Claims are exploratory in nature and it is too early to conclude any further similarities between the Côté Gold Deposit and the Mining Claims.

About the Sampling

Drill samples were collected from split NQ2 drill core at a nominal 1 metre interval breaking at major geological boundaries such that no sample interval was less than 0.5 metres or greater than 1.5 metres. The samples were submitted to AGAT Laboratories (AGAT), Sudbury, Ontario for drying, crushing and pulverization in preparation for analysis of gold by Fire Assay and a suite of trace elements by ICP methods at the Mississauga, Ontario facility. Gold assay results measuring over 10 g/t are re-analyzed by Fire Assay using a gravimetric finish.

AGAT is accredited by the Standards Council of Canada, the Canadian Association for Laboratory Accreditation and QMI-SAI Global and is an ISO 9001 and 17025 certified analytical laboratory.
A rigorous QA/QC program was implemented as part of the sampling procedures throughout the drill program. Duplicate, standard and blank samples were inserted into the sample stream prior to being sent to the laboratory and the adherence of results to strict parameters was monitored.

The technical portions of this news release were reviewed and approved by Troy Gill BSc. MAIG, Exploration Manager for the Company, a "qualified person" as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects.

Summary of Rights

As disclosed in the Company's news release dated July 25, 2013, Sanatana acquired a 20% interest in the Mining Claims for the benefit of Sanatana and TAAC. The 20% interest in the Mining Claims is held in accordance with the terms of the option and joint venture agreement dated February 14, 2011 between Sanatana and TAAC (the "Option and JV Agreement").

Pursuant to the terms of the underlying acquisition agreement (the "Acquisition Agreement"), the Mining Claims are subject to the following terms:
  • The 20% undivided legal and beneficial interest in the Mining Claims is identified as a "carried interest" under the Acquisition Agreement and is defined to mean that until completion of a positive pre-feasibility study, all costs and expenses of the exploration programs, preparation and filing of assessment reports and other obligations relating to the Mining Claims are the sole and exclusive obligation and liability of Trelawney and Sanatana will not have any obligation or liability in respect thereof.
  • Upon completion and delivery of a positive pre-feasibly study to Sanatana and TAAC, Trelawney, TAAC and Sanatana will enter into a joint venture agreement for the further exploration and development of the Mining Claims on terms to be negotiated in good faith between the parties.
  • If Sanatana's and TAAC's interest in the Mining Claims is diluted to an amount less than 10% then such interest which is less than 10% will be converted into a 2% net smelter returns royalty.
  • So long as Sanatana and TAAC have any interest in the Mining Claims, Trelawney is required to deliver to Sanatana no less than quarter-yearly, complete copies of all reports, files, maps, core, samples, data and other information regarding the Mining Claims.
  • The Mining Claims are subject to 2% net smelter return royalty which can be reduced to 1% by paying the royalty holders an aggregate payment of $1,000,000 at any time.
Staking of Additional Mining Claim

Sanatana recently staked mining claim number P-3017375 located in Chester Township, Ontario (the "Staked Mining Claim"). Pursuant to the terms of the Option and JV Agreement, the Staked Mining Claim is in the "area of interest" provided for in such agreement. Pursuant to the terms of the Option and JV Agreement, Sanatana had the right to include the Staked Mining Claim in the Watershed Property or to keep the Staked Mining Claim 100% for its own benefit. Sanatana elected the latter and the Staked Mining Claim will not form a part of the Watershed Property and accordingly TAAC will not have an interest in the same.

A map outlining the location of the Staked Mining Claim is set forth below.

Click to Enlarge

About the Company

Sanatana Resources Inc. is a Canadian mineral exploration and development company focused on its Watershed property in Ontario. Sanatana entered into an option and joint venture agreement with Trelawney Augen Acquisition Corp. (formerly Augen Gold Corp.) ("TAAC") which grants Sanatana an option to acquire up to 51% of the Watershed Property consisting of 46 mining claims totalling approximately 19,006 acres and located within the Townships of Yeo, Chester, Neveille and Benneweis. As at November 2012, Sanatana exercised its first option and is the legal and beneficial owner of 50% of the Watershed Property. Sanatana has until March 2016, to decide whether to exercise its right to acquire a further 1% in the Watershed Property. In June 2012 IAMGOLD Corporation completed its acquisition of Trelawney Mining and Exploration Inc. and became the sole indirect shareholders of TAAC. In 2013, Sanatana (i) expanded the Watershed Property by acquiring, for the benefit of Sanatana and TAAC, a 20% interest in three additional mining claims located in Yeo and Chester Townships, Ontario and (ii) staked, and is the legal and beneficial owner of a 100% interest in an additional mining claim located in Chester Township, Ontario.

With an experienced management team and board of directors, the Company has the ability required to identify, develop and fund economic mineral properties. Sanatana is based in Vancouver and is listed on the TSX Venture Exchange (TSX-V: STA).

(signed) "Peter Miles"

Peter Miles
President and Chief Executive Officer

For additional information on the Company, please contact:

Mr. Peter Miles, President and Chief Executive Officer at 604-408-6680 or email

Cautionary Statement Regarding "Forward-Looking" Information

Some of the statements contained in this press release are forward-looking statements and information within the meaning of applicable securities laws. Forward-looking statements and information can be identified by the use of words such as "plans", "expects", "intends", "is expected", "potential", "suggests" or variations of such words or phrases, or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements and information are not historical facts and are subject to a number of risks and uncertainties beyond Sanatana's control. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this news release. Accordingly, readers should not place undue reliance on forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except as may be required by law.

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