Canadian Shield Resources Inc.

Canadian Shield Resources Inc.

January 19, 2007 13:45 ET

Canadian Shield to Acquire Anderson Peru Mining And Exploration

TORONTO, ONTARIO--(CCNMatthews - Jan. 19, 2007) - Canadian Shield Resources Inc. (TSX VENTURE:CSP) ("Canadian Shield" or the "Company") is pleased to announce that it has signed a Letter of Intent/Lock-Up Agreement ("LOI") to acquire 90% of Anderson Peru Mining And Exploration S.A.C. ("APMX") from Phil Anderson. APMX, a private Peruvian exploration company, owns the Trol Gold Property in Chile and La Estrella Gold Property and Pampa Poroma Gold-Copper Property in Peru.

"We are aggressively moving forward to expand our portfolio with high quality gold and copper properties. We are very excited about the prospects for APMX's properties in Chile and Peru and look forward to Phil Anderson leading our exploration activities as VP Exploration" said Bernard Kraft, Chairman of Canadian Shield.

Pursuant to the LOI, Canadian Shield will acquire 90% of the outstanding shares of APMX from Phil Anderson for 2,000,000 treasury shares of Canadian Shield. The treasury shares will be subject to a four-month regulatory hold period. At the end of the four-month hold period, 750,000 treasury shares will be released to Phil Anderson and the balance, 1,250,000 shares, will be released at the rate of 62,500 shares per month over 24 months. The completion of the transaction is subject to the execution of definitive agreements and other transaction documents, due diligence and regulatory approval.

Mr. Anderson graduated from Colorado School of Mines in 1981 and worked as a project geologist for 10 years for Noranda, Lac Minerals, Cominco, and Hecla Mining, primarily in Alaska, in positions of increasing responsibility. Since 1991, he has acquired extensive experience in Peru, Chile, Argentina and Columbia working as a consulting geologist. Mr. Anderson resides in Peru and plans to work full time for Canadian Shield on the successful completion of this transaction.

Property Descriptions:

Estrella Gold Property: This property covers 1,800 hectares in the department of Huancavelica, district of Paucara and Acoria, Provinces of Huancavelica and Acobamba, approximately 260 km southeast of Lima, Peru. La Estrella hosts gold, silver and base metal mineralization in a broad northerly trending zone with sheeted and anastamozing quartz-sulfide veinlets plus disseminated sulfides throughout a large volume of pervasive silica-illite-pyrite altered rock.

Bear Creek Mining ("BCM") optioned the property in 2002 and spent over US$300,000 to complete surface sampling and mapping, magnetic and IP geophysical surveys, and approximately 2,000 meters of diamond core drilling. As reported by BCM, drilling was widely spaced with 12 holes and the depth of drill holes ranged from 138 to 200 meters with a total of 1,970 meters drilled. Significant drill intersections include:

DDH-1 The entire 150 meter hole averaged 0.362 g/t gold including 31.5m @
0.69 g/t gold from 2.5 to 35 meters that also includes 8m @ 1.35
g/t gold from 27 to 35 meters.

DDH-E2 From 8.5m to 33 meters, gold grades averaged 1.44 g/t gold over
24.5 meters, including one meter intervals with grades of 12 g/t
and 22 g/t. The entire 168 meter hole averaged 0.333 g/t gold with
83 meters from 8.5 to 91.5 averaging 0.55 g/t gold.

DDH-E3 The entire 160 meters was mineralized and averaged 0.3 g/t gold
and 40.5 g/t silver. Included in this broad low grade zone was a
1 meter intercept of 307 g/t silver.

DDH-E7 From 32.5 to 38.5, grades averaged 156 g/t silver over 6 meters,
including 2m at 358 g/t silver. The drill hole tested the down dip
continuation of high-grade polymetallic mineralization which has
had limited past production from underground mining and is
distinctly different than the gold mineralization drilled in the
main target area.

Geophysical data suggests there are untested targets that conform to the present geological model where there is at least in part, a stratigraphic and/or lithologic control to higher grade mineralization. IP responses also suggests there may be polymetallic mineralization hosted in Pucara limestone, possibly a large, gently west-dipping, sulfide replacement body.

Pampa Poroma Gold-Copper Property: The property lies 20km south-southeast of the town of Nasca within the Marcona District and Coastal Copper Gold Belt of southern Peru. The property comprises 1000 hectares over a flat covered area and is easily accessible lying 7 km from the paved Panamerican Highway.

There has been historical small-scale vein mining that has been re-activated in the area due to high copper prices. Copper and gold mineralization occurs in veins and structures hosted by Cretaceous andestitic volcanic rocks of the Copara Formation. Quartz-carbonate and sericite alteration dominate the style of alteration in the area with specular hematite common in isolated structures and zones of more disseminated alteration.

The known mineralized veins and structures strike north, north-northwest and north-northeast and disappear under a large area of cover to the north called Pampa Poroma. Quartz-sericite-pyrite alteration with albitization occurs around the rim of the pampa with minor thin zones of copper mineralization being localized along andesite dike margins. The package of host rocks varies from volcanic to hypabyssal felsic intrusive rocks, intermediate composition megacrystic feldspar porphyry, and Coastal Batholith tonolite. The target in the Pampa Poroma area is an Iron Oxide Copper Gold deposit possibly similar to the Mina Justa Project 25 km southwest of the Property. Mina Justa is being explored and developed by Marcobre, a joint venture company owned 70% by Chariot Resources with Korea Resources Corporation and LG Nikko Copper Inc.. The most recent resource estimation published by Chariot Resources stated in a press release dated November 2006 was measured and indicated 346.6 million tonnes at 0.71% copper with a 0.3% Copper cutoff.

Trol Gold Property: This property consists of 100 hectares located in Region 9, Quadrangle Malalhue, Chile. From 1984 to 1994, the combined exploration expenditure was US$2.5 million including nearly 7,000 meters of drilling defining a resource estimated at 180,000 ounces gold at 0.7 g/t Au. The historical resource is provided for reference only and is not considered 43-101 compliant.

Starting in 1986, a joint venture between Shell Minerals(Chile) & Amax Chile, drilled approximately 830 meters which returned intercepts of 8m of 2.5 g/t gold and 12m of 1.53 g/t gold, 2m of 10.22 g/t gold and 6m of 1.06 g/t gold. The property was optioned to Cominco in 1991 which completed 602m of reverse circulation drilling and returned intercepts of 106m of 0.99 g/t gold, 23m of 1.4 g/t gold and 1m of 1.25 g/t gold. From the drilling up to 1991, Cominco calculated a geologic resource of 6.25 Mt of 0.72 g/t gold. The historical resource is provided for reference only and is not considered 43-101 compliant.

In 1993, Pegasus Gold optioned the property and spent US$1.47 million in exploration over two years, completing 46 holes totalling 5,509 meters. Drilling and resource estimations by previous workers clearly show a stratabound nature to the mineralization. Economically important gold values are hosted exclusively in the quartz-sericite-graphite schist which directly overlies a mafic volcanic unit and underlies a graphite free quartz-sericite schist unit. Low angle structures were also identified as playing an important role in localizing mineralization.

Canadian Shield is aggressively pursuing joint ventures as part of is strategy for its existing properties and is in advanced negotiations with potential partners. The Company is also aggressively pursuing new property acquisitions in South America of which APMX is a significant first step. The addition of APMX assets combined with Phil Anderson's considerable knowledge and experience throughout Latin America, will immediately add significant exploration potential to Canadian Shield's portfolio of properties. The acquisition is expected to close by the end of February 2007.

About Canadian Shield Resources Inc.

Canadian Shield is focused on the acquisition, exploration and development of strategically located precious metal and base metal properties in Peru. The Company will continue to explore the "CSP Gold Discovery Zone" at the Humajala Gold Property and the copper porphyry potential at the Cerro Cori Copper-Gold Property. Canadian Shield also holds two other exploration properties, the Ccello Ccello Copper-Gold Property and the Pucarana Gold Property with major resource potential.

The Company's shares are listed on the TSX Venture Exchange (Trading Symbol CSP: TSX V). For further information, visit

This news release includes certain "forward looking statements". Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital.


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