Vega-Atlantic Corporation Announces LEM SILVER Project Final Joint Venture Agreement.

Business Editors

DENVER--(BUSINESS WIRE)--Sept. 21, 2000

Final Joint Venture Agreement: Vega-Atlantic Corporation ("the Company") (Frankfurt Exchange:VGA) (WKN:936303); (OTCBB:VGAA) announces that it has completed joint venture negotiations with the Yunnan Northeast Yunnan Silver Industry Company Ltd. ("Yunnan Silver") regarding the joint venture of the producing Luomachang silver mine (LEM SILVER), located in the Ludian County Seat, Yunnan Province of the People's Republic of China.

A Sino-Foreign Cooperative Joint Venture Agreement has been signed between Yunnan Silver and the Company's newly formed wholly owned subsidiary, Alaskan Explorations Corp. (domiciled in a tax exempt jurisdiction). The newly formed Joint Venture Company is named Yunnan Letong Mineral Exploration & Development Company Ltd. ("JV Company").

Joint Venture Terms: Yunnan Silver will contribute the existing LEM SILVER operating silver mine, including all physical plant and geological silver resources to the new JV Company. Under terms of the JV Agreement, the Company will invest through Alaskan Explorations Corp., US $4 million to increase production, expand reserves, and improve overall silver recovery. The Company will also contribute a further $4 million over a five-year term from its portion of operating profits to repay existing silver project capital loans currently outstanding to Chinese banks. In return, the Company's subsidiary, Alaskan Explorations Corp., will receive an 85% interest in the JV Company with cash flow from operating profits beginning from the date that the Chinese business license, currently under application, is granted which is expected this fall. In addition, Alaskan Explorations Corp. will be the mine operating partner and General Manager. Through the Company's application of western management expertise and metallurgical research in progress, the Company expects to double the production capacity of the current LEM SILVER mining operations within a 12-month period after the business license is granted, taking advantage of the unused infrastructure, surplus electrical power, oversized compressor capacity, and the over-equipped mill. The Joint Venture will also accelerate drilling to improve and expand the existing reserves and undertake production engineering feasibility studies to increase ultimate production and output to a target of 1,000,000 oz per year. This JV is unique to those previously entered into by the Company in that Alaskan Explorations Corp. will participate in profits from the mine from the outset of the JV's business license issuance, thus providing earlier realization of potential profitability.

LEM SILVER Project: The Luomachang LEM SILVER mine is only three years old, has current processing capacity of 300 tonnes of ore per day to produce up to 600,000 ounces per year of metallic silver, and includes probable, possible, and drill indicated global resources for the entire exploration and mining lease of 5.26 km. length of 9,060,200 tones of ore at 221.99 g/tonne silver containing 2,011.3 tonnes of silver" (62,550,000 oz.).

Current Preparations and Due Diligence: The Company has commissioned the services of Mr. David Taylor to outline and prepare detailed surface and underground drilling targets with budgets and work program to be executed after Alaskan Exploration Corp. takes over management functions. The Company continues to conduct metallurgical test work through the services of Process Research Associates Ltd. ("PRA") to produce a pre-feasibility study of metallurgical process upgrades. In addition, the JV Company has hired China located mining engineers as well as Professor Wong of the Kunming Metallurgical Research Institute to provide detailed study of current mining operations to develop the new mining methods for the mine expansion upgrade path.

Further due diligence continues by the Company. Further due diligence is being undertaken through the audit of the JV Company's opening balance sheet to US Generally Accepted Accounting Principles (GAAP and SEC standards) and is being arranged by an internationally recognized accounting firm. The audit report is a fundamental finalizing component of the joint venture structure between parties.

About the Company: Vega-Atlantic Corporation is a minerals exploration and development company concentrating on gold, silver, and zinc exploration and mining joint ventures in the People's Republic of China and internationally. The Company concentrates on properties that can establish and realize cost effective mining operations within the near term. Vega-Atlantic Corporation is assessing further acquisitions to add to its existing joint venture projects.

Safe Harbor Statement

Forward-looking statements in this release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including, without limitation, commodity prices of precious metals and actual results differing materially from projections because of geological factors, operation factors, government regulations or factors relied upon from independent sources, may either negatively or positively impact exploration or mining operations. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in the future periods to differ materially from forecasted results. The Company assumes no obligation to update the information in this release.

Vega-Atlantic Corporation common stock is traded on the Frankfurt Stock Exchange (FWB) under the symbol VGA, (WKN: 936303) and on the OTC Bulletin Board in the United States under the symbol VGAA.