Neo Alliance Minerals plans to raise Can$3 million through a non-brokered private placement of up to 6 million shares in the company at Can$0.50 each.

Each share will consist of one common share of the Corporation and a half common share purchase warrant, with each whole warrant entitling the ivnestor to buy one additional common share at a price of $0.65 exercisable for a period of 18 months after the closing date.

Neo-Alliance will be able to accelerate the expiry date of the warrants if its market price exceeds $0.75 for 10 days, which does not need not be consecutive. If this occurs then the investor will need to exercise the warrants within 30 days.

Money raised through the private placement will be used for exploration of the company's Majiahe and Xuefeng properties and for acquisition of gold properties at proven mineralized belts of significance in China.

The private placement is expected to close on or about October 9.

Neo Alliance listed as a public company in April this year on the Toronto Venture Exchange. It is also listed on the Frankfurt Stock Exchange.

The company is positioning itself as a Western Chinese Mining Company to become a meaningful gold producer with its focus in China, where costs are low and there is a wealth of talented labour that complements the nation's mineral wealth.

Neo Alliance's principal project is a controlling investment in the Xihe County Kai Yuan Minerals Ltd, a Chinese company with a 10% holding in the Majiahe Gold Mine of Gansu Province which has already been granted a mining licence.

A resource estimate verified by Associated Mining Consultants Ltd (AMCL) has indicated the current NI 43-101 compliant inferred resources of 3.33 million tonnes grading at 1.34 grams per tonne gold producing approximately 143,650 ounces gold has been estimated.

The company also has an option to acquire a 90%-interest in the Xuefeng Gold properties.