Medallion Renegotiates Ocelot Gold Project Acquisition Terms

    TSX-V: MDL

    VANCOUVER, July 8 /CNW/ - Medallion Resources Ltd ("Medallion" - TSX.V:
MDL) announces that it and the Ocelot property vendors, Allied Nevada Gold
Corp. and Robert Foster (the "Vendors"), have signed an amending Letter of
Intent (LOI), which alters the Company's acquisition terms for the Ocelot,
Nevada, gold-exploration property. The LOI converts the Mining Lease and
Option to Purchase Agreement, dated April 21, 2006 (the "Original Agreement")
into an option and joint-venture structure between Medallion and the Vendors.
To secure the terms of the LOI, US$45,000 has been paid to the Vendors. The
amended LOI terms are subject to the approval of the TSX Venture Exchange.
    Under the terms of the LOI, Medallion may now earn a 60% joint-venture
interest in the property by making an annual property payment of US$30,000 to
the Vendors and by spending on property exploration over four years a total of
US$1.2 million. The first annual property payment is due by 31 July 2008.
Medallion must also make all property assessment payments and perform a yearly
property-expenditure commitment, which requires US$150,000 during the first
year, US$250,000 during the second year and US$400,000 during the third and
fourth years. Medallion will be project manager during and following the
earn-in period. Following earn-in, the Vendors will have a one-time back-in
right to acquire an additional 20% of the project for a payment equal to 200%
of Medallion's expenditures up to the date of the Vendors' exercise of its
back-in right.
    The Ocelot is an exciting Nevada gold project, which deserves further
serious exploration. The LOI's proposed joint-venture structure, payments and
work commitments replace the onerous ever-escalating advance royalty payments
and drilling requirements of the Original Agreement. The result should be a
more manageable and methodical exploration of the property. The Vendors'
experience, reputation and contacts in Nevada will be important as the
exploration of the Ocelot property proceeds. Medallion welcomes Allied Nevada
Gold Corp. and Robert Foster as partners.
    The Ocelot Gold Project targets potential deep, high-grade mineralization
of the epithermal quartz-adularia gold-exploration model. This model is
characterized by gold deposits similar to Midas, Silver Cloud, and deeper
portions of Sleeper and Grassy Mountain. Typical of the epithermal
quartz-adularia gold model, the Ocelot property contains widespread
occurrences of silicification, anomalous gold values and a quartz-adularia
hot-springs system. The property also lies at the intersection of two major
Nevada gold trends, the Austin-Lovelock Belt and the Independence-Crescent
Valley Lineament. The Austin-Lovelock Mineral Belt is host to numerous
epithermal deposits including Florida Canyon, Relief Canyon, Hogg Ranch,
Northumberland and Rochester (combined production of over two million ounces
of gold). The Pipeline deposit (expected production of over 15 million ounces
of gold) occurs along the Independence-Crescent Valley Lineament.
    Medallion also holds mineral rights and interests in the Amazing Grace
Gold Project and the Lodi Hills Gold Project. At Amazing Grace southeast of
Castlegar, British Columbia, the exploration target is an extensive surface
exposure of gold-bearing veins and altered wall rock that holds the potential
for a bulk-tonnage open-pit gold operation. At Lodi Hills in northern Nye
County, a reconnaissance rock-chip sampling program, in an area of
hydrothermal alteration and old prospect pits, has outlined a zone of
approximately 900 metres by 750 metres with anomalously high geochemical
values of gold and silver.
    Medallion's strategy is to create a portfolio of high-impact mineral
projects. The Company is currently evaluating and negotiating for additional
projects in mining-friendly jurisdictions of North America.


    "William H Bird", PhD, PGeo, President & CEO

    William H. Bird, PhD, PGeo, serves the Board of Directors of the Company
as an internal, technically Qualified Person. Technical information in this
news release has been reviewed by Dr Bird and prepared in accordance with
Canadian regulatory requirements as set out in National Instrument 43-101.
Company Management, which takes full responsibility for content, prepared this
news release. The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release. Some of the
statements contained in this release are forward-looking statements, such as
estimates and statements that describe the Company's future exploration and
financing plans, objectives or goals, including words to the effect that the
Company or management expects a stated condition or result to occur. Since
forward-looking statements address future events and conditions, by their very
nature, they involve inherent risks and uncertainties. Actual results in each
case could differ materially from those currently anticipated in these
statements. Such risks include expectations that may be raised by discussing
potential mine types and by comparing the Company's projects to other gold
projects and to exploration models. Also, in order to proceed with the
Company's exploration and acquisition plans, additional funding is necessary
and, depending on market conditions, this funding may not be forthcoming on a
schedule that facilitates the Company's plans.

    %SEDAR: 00006083E

For further information:

For further information: check the website or
contact William H Bird, (888) 827-6611, e-mail; Wayne
Marsden, (888) 366-4464, e-mail

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