June 27, 2007

Post in News by Admin

TORONTO, Canada – Aura Gold Inc. (“Aura Gold”) (TSX:ORA) is pleased to announce that it has entered into a definitive purchase agreement(the “Purchase Agreement”) with Zoneplan Limited (“Zoneplan”) and Repalla Inc. (“Repalla” and together with Zoneplan, the “Sellers”), to acquire Clearwater Holdings Fund LLC which, through its subsidiary, holds the rights to the Arapiraca copper-gold development project (the “Arapiraca Project”) located in the State of Alagoas in northeastern Brazil (the “Acquisition”). The purchase price will be paid by issuing an aggregate of 320 million common shares of Aura Gold to the Sellers, subject to certain escrow restrictions. Subject to the fulfillment of certain conditions precedent, and Aura Gold obtaining all necessary approvals, closing of the Acquisition is expected to occur in mid July 2007.

Assuming the completion of the Acquisition, Zoneplan would be issued 288 million common shares as consideration for the transaction, and Repalla would be issued 32 million common shares, subject to certain escrow restrictions. The Sellers have the right to participate in new equity financings to maintain their pro rata interest in Aura Gold and will be entitled to place a representative on Aura Gold’s Board of Directors. Aura Gold will pay Net Smelter Return royalties on future production to Mineração Barra Bonita Ltda. (“Barra Bonita”), a non-arm’s length party to Zoneplan, of 0.75% on copper, 1.0% on gold and 4.0% on all other mineral production from the Arapiraca Project.

The Acquisition is a “related party transaction” within the meaning of OSC Rule 61-501 (“Rule 61-501”) and, as such, requires the preparation of an independent formal valuation. The Acquisition must also be approved by a majority of votes cast at a meeting of Aura Gold shareholders present in person or by proxy, excluding votes cast by those Aura Gold shareholders required to be excluded pursuant to the minority approval provisions of Rule 61-501.

The Board of Directors of Aura Gold established a special committee of independent directors consisting of Messrs. Patrick Mars and Philip Martin (the “Special Committee”), to supervise the negotiation of the Purchase Agreement. The Special Committee engaged Paradigm Capital Inc. (“Paradigm”) to prepare a formal valuation of the Arapiraca Project in accordance with Rule 61-501 (the “Formal Valuation”). The purchase price for the Arapiraca Project is within the range of fair values established by Paradigm in the Formal Valuation. The Special Committee considered, based upon discussions with Paradigm, to recommend the Acquisition to the Board of Directors. The Board of Directors has approved the Purchase Agreement and the Acquisition and unanimously recommends that Aura Gold shareholders vote in favour of the Acquisition.

Special Meeting of Shareholders

A special meeting of Aura Gold shareholders has been scheduled to be held on July 13th, 2007 (the “Meeting”) to consider, among other matters, the Acquisition. The Meeting will be held at the National Club, Howland Room, 303 Bay Street, Toronto, Ontario, M5H 2R1 on July 13, 2007, at 8:45 a.m. (Toronto time). In connection with the Meeting, proxy materials were mailed to shareholders of record on June 21, 2007.

Other matters to be approved at the Meeting include the issuance of 112,140,000 Subscription Receipts exchangeable for 112,140,000 Aura Gold common shares of the Company in connection with the previously announced private placement financing; a consolidation of Aura Gold’s authorized capital on the basis of one new common share for every five existing common shares; the Company’s 2007 stock option and share compensation plan to replace the Company’s existing plan; and a change in Aura Gold’s name to “Aura Minerals Inc.”.

Further details of matters with respect to the Acquisition and the other matters to be approved at the Meeting are set out in the Company’s information circular dated June 15, 2007 in respect of the Meeting which has been mailed to shareholders and is available under the Company’s profile on SEDAR at www.sedar.com.

Arapiraca Project

The Arapiraca Project is located in the central-southern part of the State of Alagoas, Brazil. The property consists of one mining concession and 82 exploration licenses totaling approximately 150,000 hectares and includes the advanced stage Serrote da Laje copper-gold-iron deposit which was drilled in two phases by CVRD in the mid 1980’s and late 1990’s. Several resource estimates have been completed for the Serrote da Laje deposit including the most recent one conducted in early 2007 by Reuben Horbach for Barra Bonita, the previous holder of the property.

In April 2007, the Company retained Watts, Griffis and McOuat Limited (“WGM”) to conduct a technical due diligence study on the Arapiraca Project and to prepare a NI 43-101 compliant report to support the Acquisition and its related financing (a copy of the report has been filed on SEDAR). Velasquez Spring, P.Eng., and Dorota el-Rassi, P.Eng., of WGM, both of whom are independent qualified persons as defined by NI 43-101 and have reviewed this section of the news release, conducted an audit on the 2007 mineral resource estimate completed by Horbach for Barra Bonita and agreed that the mineral resource is classified as an Inferred Mineral Resource containing 111.3 million tonnes at 0.55% Cu and 0.16 g Au/t, using a 0.2% Cu cutoff grade.

The project also contains significant iron and nickel mineralization but these were not included as part of the mineral resource estimate. Should the transaction be approved, the Company plans to include these minerals as part of its assay data and metallurgical testwork programs in order to determine their economic importance.

Corporate Developments

As of July 1, 2007, the Company will relocate its head office to Vancouver from Toronto. The new address and contact numbers will be:

Aura Gold Inc
P. O. Box 10373 Pacific Centre
Suite 805-609 Granville Street
Vancouver, BC V7Y 1G6
Telephone: 604 669 4777
Facsimile: 604 696 0212

With the Company’s relocation to Vancouver, Michele Jones will be appointed as Vice President-Corporate Affairs and Corporate Secretary of the Company, effective July 1, 2007. Ms. Jones has worked in the corporate and administrative areas of the mining industry for over 20 years and most recently held the position of Corporate Secretary with Viceroy Exploration Ltd., prior to its acquisition by Yamana Gold Inc.

Subsequent to the Acquisition, the Company will continue to expand its operations, exploration and corporate development team as is necessary to meet the Company’s strategy of becoming a mid-tier producer by aggressively acquiring and developing mineral projects.

As a result of the Acquisition and related transactions, Santa Elina (Themistokli Dervi, 3, Julia House, P.C. 1066, Nicosia, Cyprus), directly and indirectly, will hold an aggregate of 293,550,000 common shares of Aura Gold, representing approximately 57% of the issued and outstanding common shares of Aura Gold following completion of the Acquisition and related transactions.

Santa Elina does not have any present intention to acquire ownership of, or control over, additional securities of Aura Gold. It is the intention of Santa Elina to evaluate its investment in Aura Gold on a continuing basis and such holdings may be increased or decreased in the future.

To obtain a copy of the early warning report filed in connection with Santa Elina’s holdings in Aura Gold, please contact Mr. Marco Moherdaui at 55-11-3082-7577.

About Aura Gold Inc.

Aura Gold Inc. is a Canadian exploration and development company focused on the acquisition and development of mineral deposits in Brazil and elsewhere South America. The planned acquisition and development of the Arapiraca project is part of an ongoing strategy to build Aura Gold into a mid-tier producer in the near term. Aura Gold’s current exploration projects are the Cumaru, the Inaja Greenstone Belt and the North Carajas Claims, which total approximately 600,000 hectares in the Carajas Metallogenic Province of north-central Brazil.

For further information, please visit the Aura Gold web site at www.auragoldinc.com, or contact:

Patrick Downey
President & CEO
Tel: 604.669.4777
Email: pdowney@auragoldinc.com

Steve Dawson
Vice President, Corporate Development
Tel: 416-363-8238
Email: sdawson@auragoldinc.com

Cautionary Statement:

This news release contains forward-looking statements contained that are not historical facts. Forward-looking statements involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward looking statements in this news release include, but are not limited to, completion of the Acquisition, completion of the Financing and the realization of mineral resource estimates. Factors that could cause actual results to differ materially from these forward-looking statements include those risks set out in Aura Gold’s public documents filed on SEDAR. Although Aura Gold believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Aura Gold disclaims any intention or obligation to update or revise any forwardlooking statement, whether as a result of new information, future events or otherwise.