LYSANDER GOLD ACQUIRES LEGENDARY BRAZILIAN MINE.

VANCOUVER, British Columbia--(BUSINESS WIRE)--Dec. 12, 1994-- Lou Duarte, president of Lysander Gold Corporation (VSE:LYS) announced today that the company has reached an agreement in principle to acquire an 80 percent interest in the Passagem Gold Mine at Mariana in the state of Minas Gerais, Brazil. Passagem is close to the city of Belo Horizonte, the mining capital of Minas Gerais, and approximately 490 kilometers from Rio de Janeiro.

With this acquisition, Lysander consolidates its commitment to gold mine development in the Quadrilatero Ferrifero (Iron Quadrangle), the most important gold region of Brazil, the world's seventh largest producer of gold. Lysander's other projects in the region include Cata Preta, to be brought to production within 24 months, and Carrancas, scheduled for further exploratory drilling.

The Passagem Mine is one of Brazil's oldest and longest producing gold mines. Mining began in the early 18th century and continued intermittently until 1974. In this period, with relatively primitive mining techniques, Passagem yielded more than 1.1 million ounces of gold.

Current estimates suggest the Passagem still contains up to two million ounces of gold.

The Passagem Mine has been, until now, privately owned by a Brazilian family under the corporate name Cia Minas de Passagem S/A. It has been, after Anglo-American's Morro Velho, the country's leading gold producer.

Other mines in the area include Morro Velho, Raposos and Cuiaba, which produced more than 411,500 ounces in 1993, and Gencor's Sao Bento, with 1993 production of 110,000 ounces.

The gold deposits in the Passagem properties are stratabound and correspond stratigraphically to the Batatal formation of the pre- Cambrian Minas series. They lie concordantly between the clastic sediments of the underlying Moeda formation and the chemical sediments of the overlying Caue formation (dolomitic itabirites). At Passagem, the Minas series forms an easterly plunging anticline about five kilometers wide. The principal mine sits on the nose of this anticline, with another three mines and old workings along its flanks. These mines and old workings cover only half the seven- kilometre length of the main mineralized horizon. The property in total extends for more than 40 square kilometers.

To acquire 80 percent ownership of the Passagem property, Lysander Gold must:

- Make a cash payment of US $75,000 on receipt of regulatory approval of the transaction;

- Make a cash payment of US $250,000 or, at the vendor's option, issue Lysander shares for an equivalent value upon receipt of regulatory approval, at which point Lysander will have earned a deemed 20 percent interest;

- Issue another 250,000 Lysander shares 18 months from the effective date, thus earning a further deemed 20 percent interest in the property;

- Fund an exploration/development program up to US $3 million within 30 months of the effective date;

- Upon completion of the exploration/development program, issue an additional 500,000 Lysander shares, at which time Lysander will be fully vested to 80 percent ownership on Passagem.

In addition, Lysander will be required (subject to a bankable feasibility study) to arrange project financing to bring the mine into production. Lysander's management team will take Passagem through the development stage to the feasibility study. The transaction is subject to execution of a definitive agreement and all applicable regulatory approvals.

Lysander will soon establish an operating subsidiary in the area, under the direction of Stephen Sopher, a Lysander director who was previously managing director of Inco's Mineracaco Serras do Sul and executive vice president of TVX Gold Inc.

Lysander Gold Corporation is also active in Canada. At the Lorraine property in British Columbia, recent drilling yielded several high- grade intercepts, including 302 feet of 1.48 percent copper and 0.019 oz/ton gold. Also in BC, a recently completed drill program at the CAT property expanded the dimensions of the BET gold deposit. Further work is planned for 1995. In the Northwest Territories, Echo Bay Mines Ltd. continues to work to earn an interest in Lysander's OP property located near Echo Bay's Lupin mine.

Lysander is a public company listed on the Vancouver Stock Exchange under the symbol "LYS". -0-

NOTE: The Vancouver Stock Exchange has neither approved nor disapproved the information contained herein.

CONTACT: Lysander Gold Corporation

Lou Duarte, 604/681-8069