Jun 22, 2010

Edgewater Acquires Option on Red Back Mining's Enchi Gold Project, Ghana; Completes $3.0m Financing

Red Back Purchases 7.5% Equity Interest in Edgewater

VANCOUVER, BRITISH COLUMBIA - Mr. George Salamis, President and CEO of Edgewater Exploration Ltd. ("Edgewater" or the "Company") (TSX VENTURE:EDW) is pleased to announce that the Company has closed the previously announced $3.0 million private placement financing (see Edgewater News Release dated May 5, 2010) and entered into an Option Agreement (the "Agreement") with Red Back Mining Inc. ("Red Back") (TSX:RBI) on Red Back's Enchi Gold Project, Ghana.

Option Terms

To earn 51% of Red Back's ownership in the Enchi Gold Project licences (representing a 45.9% direct interest in the Project taking into account the 10% project interest held by the Government of Ghana) Edgewater is required to spend a total of C$5.0 million on work expenditures on the Enchi Gold Project within 26 months with C$2.0 million required to be spent by August 21, 2011 and the balance of C$3.0 million by August 21, 2012. Once Edgewater has completed a total of C$5.0 million in work expenditures on the Project, Edgewater will have earned and vested in a 51% interest in Red Back's ownership of the Project and a joint venture company ("JVCO") will be formed. The initial share ownership in JVCO will be as follows:

Edgewater 45.9%
Red Back 44.1%
Ghana Government 10.0%

Once the JVCO is formed, Red Back and Edgewater will share all future exploration and development expenditures pro-rata. Edgewater will be Operator of the Project during the Option period and will continue to be the Operator as long as the Company holds the largest equity stake in JVCO.

Bonus Warrants

As additional consideration for the Option, Edgewater issued to Red Back 2,500,000 common share purchase warrants exercisable at $0.50 per common share and 2,500,000 common share purchase warrants (collectively the "Warrants") exercisable at $1.00 per common share. The Warrants will all be exercisable for five years and will only be exercisable by Red Back if Edgewater is able to delineate at least 3.0 million National Instrument 43-101 compliant ounces of gold in the Measured and Indicated resource categories on the Project.

A Finders Fee of 565,000 common shares is payable to Featherstone Capital Advisors Inc. ("Featherstone") in connection with the Option Agreement with Red Back. The common shares to be issued as the finder's fee will be released to Featherstone as exploration work is completed on the Project. Featherstone is engaged as financial and capital markets advisers to Edgewater.


The Company completed a non-brokered, private placement financing consisting of 6.0 million units at a price of $0.50 per unit for gross proceeds of $3,000,000. Each unit consists of one common share and one-half of a common share purchase warrant. Each whole warrant entitles the holder to purchase one common share in Edgewater until June 21, 2011 at a price of $0.76 per share. Red Back participated in the financing with the purchase of 2.0 million units for $1,000,000 which represents a 7.5% equity interest in the Company on an issued and outstanding basis. Edgewater will have a Right of First Refusal with-respect-to the sale of any or all Edgewater shares held by Red Back. A cash finder's fee of $150,000 was paid to Cormark Securities Inc. on the financing. The proceeds of the private placement will be used by the Company for expenditures on the Project and for general working capital. The common shares and warrants issued in connection with the private placement will have a four month hold period ending on October 22, 2010. After completion of the private placement financing Edgewater has 26,505,000 million common shares issued and outstanding.

Enchi Gold Project, Ghana

The Enchi Gold Project located in southwest Ghana, West Africa covers a 40 kilometre strike length of the Bibiani Shear Zone that hosts a number of major gold mines and deposits including Red Back's Chirano Gold Mine located 70 km northeast of the Project and the Bibiani Gold Deposit located 90 km northeast of the Project. Ghana is the second largest gold producer in Africa with 2009 production totalling 2.9 million ozs. The Enchi Gold Project is comprised of eight licenses totalling 568 km2 and is located 290 km west of the capital city Accra. Access to the Project is on sealed roads via the regional port city of Takoradi or the mining centre of Tarkwa and then on gravel roads to Enchi (population 9,270). Access throughout the Project licenses is via earthen roads.

Of the 16 gold prospects currently identified at the Enchi Gold Project, ten have been drilled through a combination of RAB, RC and diamond drill totalling 648 holes (40,876 m). The most significant results from the drilling have occurred at the Boin Zone, Sewum Valley and Nyamebekyere prospects with the occurrence of significantly elevated gold grades (>1 g/t) over considerable widths, at times in excess of 30 m, and continuous over hundreds of meters of strike length (see Edgewater News Release dated May 5, 2010)

The style of gold mineralization encountered in these areas bare strong similarities to classic "Ashanti-style" gold mineralization, in terms of geological and structural characteristics, and is the most important type of gold occurrence in West Africa.

Edgewater management is currently in the process of compiling the past exploration data on the Enchi Gold Project and is moving quickly towards initiating a comprehensive trenching and drilling program, designed to follow up on areas where broad zones of low grade gold mineralization have previously been encountered. This program is expected to begin in Q3, 2010.

The TSX Venture Exchange has accepted for filing a technical report entitled "Technical Report on the Enchi Gold Project, Ghana" date June 15, 2010 authored by Todd McCracken, P.Geo. of Wardrop Engineering Inc. (the "Technical Report") and prepared in connection with the Enchi Gold Project. A copy of the Technical Report has been filed on SEDAR at www.sedar.com under Edgewater's profile.

The technical content in this news release pertaining to the Enchi Gold Project was read and approved by Todd McCracken, P.Geo. of Wardrop Engineering Inc., a professional geologist registered in the province of Ontario and is a Qualified Person ("QP") as defined by National Instrument 43-101.

On behalf of the board of EDGEWATER EXPLORATION LTD.

George Salamis, President and CEO

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

For more information, please contact
Edgewater Exploration Ltd.
Ryan King
Vice President
(604) 628-1012

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