Goldsource Mines Inc.
TSX VENTURE : GXS

Goldsource Mines Inc.

January 25, 2010 15:20 ET

Goldsource Files Border NI 43-101 Technical Report

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 25, 2010) - Goldsource Mines Inc. (TSX VENTURE:GXS) (the "Company") is pleased to announce that the NI 43-101 Technical Report which includes the compliant, initial thermal coal resource estimated by Moose Mountain Technical Services for the Company's Border property near Hudson Bay, Saskatchewan has been filed on SEDAR (www.sedar.com). The report details the work carried out to date and provides resource estimates and analytical results as well as detailed geological interpretations based on 119 diamond drill holes totalling approximately 17,370 metres of core drilling. Three phases of core drilling since 2008 have been completed at Border to establish this technical analysis and initial estimated coal resource.

The current estimated coal resources at Border consist of 63.5 million Indicated tonnes plus 89.6 million Inferred tonnes, and 18.7 million Speculative tonnes. The Inferred and Speculative resources are limited only by the current lack of drill hole data within an already defined geophysical anomaly. The Inferred Resources are contained in two deposits, Niska 108 and Niska 107, which contain 66.1 million tonnes and 23.5 million tonnes respectively. Further drilling is planned that may convert the majority, if not all, of the Inferred and Speculative tonnes into the Indicated Resource category.

Geological interpretations of the drill core and downhole geophysical logs have determined that there are three main seams at Border which have been designated Durango A, B and C. The Geologic-Type as defined by GSC Paper 88-21 with respect to the complexity of the deposits is considered "Moderate" and the Deposit-Type is considered "Surface Mineable". The resources are distributed over 4 sub-basins which include 14 potentially surface mineable deposits which range in size from 1.8 million tonnes to 66.1 million tonnes.

Border Coal Quality Summary

The preliminary coal quality results at Border, as determined by Loring Labs of Calgary, Alberta, indicate that:

  • Border coal is ranked as sub-bituminous A to C according to ASTM standards. The previously stated bituminous ranking by Loring was re-ranked to sub-bituminous based on petrographic analysis;
  • As Received Ash ranges from 11.7 to 22.1% by weight (wt) which is similar to currently producing coal mines in Alberta;
  • As Received Total Moisture content ranges from 17.7 to 33.4% (wt) which is standard for sub-bituminous coals. Total Moisture includes inherent and surface moisture as received by the laboratory;
  • Equilibrium Moisture which is the approximate amount of moisture inherent in the coal averages 22% (wt) from a Total Moisture of approximately 31% (selective samples). This indicates that a reduction in moisture is therefore possible with a subsequent increase in Calorific Value (CV). Further test work is being planned to fully analyze this upgrading concept;
  • As Received Sulphur ranges from 1.5 to 3.2% (wt);
  • As Received Calorific Value (Heat Value) ranges from 13,335 to 17,594 KJ/Kg (5,734 to 7,565 BTU/lb) using AR Ash and Total Moisture. A majority of the resource is above 7,300 BTU/lb AR which is similar to currently producing coal mines in Alberta; and
  • Air Dried Calorific Value (Heat Value) ranges from 18,027 to 21,977 KJ/Kg (7,750 to 9,450 BTU/lb) using an average AD laboratory value of 5%, as dried by Loring.

Border thermal coal quality in regards to Moisture, Ash and Calorific Values are comparable to the Alberta Plains coal deposits which currently produce most of the electric power for Alberta. The general thickness of Alberta coal seams is 0.5 to 5 metres whereas at Border the average true thickness is approximately 25 metres. Average waste to coal ratios for Alberta coal operations are approximately 8:1 whereas at Border, some deposits have a waste to coal ratio as low as 3.3:1, making Border coal potentially more economically attractive for open pit or strip mining. A 20:1 incremental strip ratio is considered to be conceptually open pittable based on GSC Paper 88-21 and depending on the coal's monetary value.

The recommendations of the Technical Report are to complete a Preliminary Economic Assessment for the property to assess coal deposit mineability, washability, infrastructure requirements, permitting requirements, environmental baseline work, transport, pricing, local and export markets, preliminary capital and operating costs, on-site power plant viability and preliminary economic viability.

Geologically, the coal is located in the Cretaceous Mannville Group, mostly in the Cantuar Formation which is approximately 90 to 100 million years old. Coal occurs in discrete deposits ranging from 200 metres to greater than 2 kilometres in diameter. These deposits are currently considered to have formed in depressions, caused by the dissolution of salts and/or evaporate in the underlying Devonian limestones in which coal forming plant material collected.

Geophysically, the Company continues to refine its proprietary interpretation of the airborne geophysical signatures to determine which targets have the highest potential of being coal bearing. The drilling success rate is increasing with each program as adjustments are made while comparing actual field results to the Fugro airborne geophysical data. The geophysical success at Border is currently being implemented on the Company's other projects in Saskatchewan and Manitoba with multiple targets already defined for exploration drilling this winter.

N. Eric Fier, CPG, P.Eng. is Qualified Person for this news release and has reviewed and approved its contents.

Goldsource Mines Inc. is a Canadian resource company engaged in the exploration and development of Canada's newest coal field in the province of Saskatchewan. The Company has drilled only a portion of this new thermal coal field and has discovered 15 coal deposits of varying size with coal thicknesses up to 100 meters within the permit area of the Border Coal Project. Headquartered in Vancouver, BC, the Company is well-financed and is managed by experienced mining and business professionals.

This news release contains forward-looking statements, which address future events and conditions, which are subject to various risks and uncertainties. The Company's actual results, programs and financial position could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Company's control. These factors include: the availability of funds; the timing and content of work programs; results of exploration activities and development of mineral properties, the interpretation of drilling results and other geological data, the uncertainties of resource and reserve estimations, receipt and security of coal permits and mineral property titles; project cost overruns or unanticipated costs and expenses, fluctuations in commodity product prices; currency fluctuations; and general market and industry conditions.

Forward-looking statements are based on the expectations and opinions of the Company's management on the date the statements are made. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.

J. Scott Drever, President

GOLDSOURCE MINES INC.

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

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