Southern Energy Completes the Acquisition of the Catalina Silver and Gold Property

Southern Energy Completes the Acquisition of the Catalina Silver and Gold Property

Southern Energy Company Inc., a publicly traded resource exploration company, is pleased to announce that it has completed its acquisition of the Catalina Silver and Gold Property located northwest of Santiago, Chile. Pursuant to the terms of the agreement, the Company acquired the property for a total of 2,000,000 shares of restricted common stock at a deemed price of $1.50 per share.

About the Catalina Silver and Gold Property

The Catalina property is comprised of 14 claims blocks totaling 1100 hectares. The claims are located 200 km northwest of Santiago, the capital of Chile, and 31 km from the mining town of Petorca. The area is a well-know district of copper, gold and silver mining, and the area is currently being staked and explored by several of Chile’s larger mining producers with many small scale mining operation around the claims now acquired by Southern Energy.

The prospect itself has produced and shipped ore to Enami, the state owned custom smelter and refinery located 50 km from the property. The last shipment was 22.4 tons of ore to a locally owned custom mill and concentrator facility located 22 km from the mine.

Representative samples of the shipped ore and results from chip samples across the systems from the different “veins” range from 0.6 to 5.37 g/t gold,0.6 to 7.89 g/t copper, and 20 to 497 g/t silver. These “veins” run 3000 meters in length and 0.80 meters to 3.20 meters in width and appear to be increasing in grade and width at depth.

The Catalina main adit is drifted into the shear zone at an almost flat grade and south for about 110 meters. The wall rock is of sufficient stability that support beams and timbering is not required in the underground workings. The main tunnel outlines a clear, consistent and predictable structure that contains extremely high-grade copper, gold, silver, lead and zinc ore. The gold content is increasing further to the west. The main tunnel runs north to south with two shafts constructed downward to access additional ore below the main area.

The main mineralization is chalcopyrite, chalcocite, sphalerite, galena and bornite. In 2006, a Consulting Engineer estimated more than 250,000 tons of high-grade reserves. It is not currently known how much deeper this formation goes below the current workings, but due to the strength and competence of the structure, it is likely to carry on to much greater depth and distance.

Initial sampling and mapping of the claims has discovered a well mineralized area of 3 kilometers by 1 kilometer. The Company plans an extensive geological program to delineate the mineralized area and increase indicated reserves.

The Catalina project is in close proximity to several mining communities featuring an excellent work force and access to mining equipment with infrastructure comprised of nearby mills, concentrators and smelters for processing. Ore trucks are able to access the property and delivery ore directly to the mill.

Production can be quickly upgraded to provide both positive cash flow and exploration development for future benefit.

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