Troy Resources NL
ASX : TRY
TSX : TRY

Troy Resources NL

December 09, 2009 20:39 ET

Troy Resources NL: Follow-Up Drilling Indicates High Grades at Two Mile Hill Prospect, Sandstone Western Australia-Further Drilling Planned

PERTH, WESTERN AUSTRALIA--(Marketwire - Dec. 9, 2009) -

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HIGHLIGHTS

- Follow-up drilling targeting the high grade Banded Iron Formation (BIF) hosted gold mineralisation intersected significant gold mineralisation on the western margin of the Two Mile Hill tonalite. The BIF is quartz veined and extensively replaced by pyrite with the best intercepts reported being:

-- TRCD825: 8.5m @ 49.59g/t Au from 195.8m downhole;

-- TRCD821: 2m at 9.1g/t gold from 205m downhole; and

-- TRCD827: 4.75m grading 11.16g/t gold from 198.25m downhole.

- In holes drilled to test the BIF along the eastern margin of the tonalite, gold mineralisation was encountered in quartz veins in the tonalite and in quartz veins in the host metabasalts with a peak value of:

-- TRCD820: 4.8m grading 48.26g/t gold from 114.2m downhole.

- The best tonalite hosted vein intercept was:

-- TRCD824A: 1m grading 21.15g/t gold from 301m downhole.

Troy Resources NL ("Troy") (TSX:TRY)(ASX:TRY) today reported the results of a 9 hole (2,812.6m) follow-up drill program at the Two Mile Hill Prospect, located 2.7km northeast of the Sandstone Mill, which reinforce the high grade potential of the Banded Iron Formation hosted style gold mineralisation identified during drilling completed earlier this year (TRCD733: 13.7m at 25.98g/t gold from 240.1m downhole).

Troy CEO Paul Benson said today that although the latest drilling results were highly encouraging, the nature of the mineralisation in the exploration area meant more work was needed.

"These results are from the third phase of drilling at Two Mile Hill and were aimed at better understanding the high grade mineralisation announced in August of this year," Mr Benson said.

"We have again had some extraordinary intersections, including 8.5m @ 49.59g/t gold. The challenge continues to be proving up a target of sufficient size that justifies development.

"With this in mind, the overall results are viewed as sufficiently encouraging for the Board to approve a further 8 hole program. We expect to complete this program and be in a position to make a final decision on any development in the March quarter of 2010.

"Sandstone has an amazing history of coming up with more gold just when we think it is about to run out. The mine has never had a forecast life longer than 3 years but recently celebrated its 10th year of consecutive production for Troy. Obviously our hope is that one of these targets will enable us to again extend the mine life."

In the drilling earlier this year the BIF was intersected on both sides of, and in close proximity to, the tonalite. The BIF unit cut by the stock dips to the northeast at about 30o and varies in thickness from 25m to 50m. The BIF is quartz veined and extensively replaced by pyrite. This latest drilling program targeted high grade BIF hosted gold mineralisation associated with the margins of the north-south elongated, gold bearing tonalite stock.

All assays have now been received for the 9 hole drill program consisting of Reverse Circulation (RC) precollars and Diamond Core (DC) extensions totaling 2,812.6m (248.4m in RC precollars; 2,564.2m in DC).

The recent drilling has highlighted the fact that the BIF hosted mineralisation is structurally controlled and is a difficult drill target. Two styles of sulphide (pyrite) replacement were noted in the recent drilling; a disseminated fracture infill style and a more massive "wave front" style. This drilling has confirmed that only the massive pyrite replacement, as bands or concentrations, is associated with high gold grades in the BIF. The disseminated style of pyrite mineralisation in the BIF yields only slightly anomalous gold values.

High grade gold mineralisation was encountered in several of the holes drilled to test the BIF on the west side of the Two Mile Hill intrusive and included:

- TRCD825: (up dip from TRCD733) 8.5m @ 49.59g/t Au from 195.8m

-- including 3.6m @ 91.68g/t gold from 195.8m;

- TRCD821: 7.8m at 3.2g/t gold from 199.2m downhole

-- including 2m at 9.1g/t gold from 205m downhole; and

- TRCD827: 4.75m grading 11.16g/t gold from 198.25m downhole.

Two mineralised zones were indentified in the BIF with the Lower Zone hosting the high grade gold mineralisation. In TRCD825 the Lower Zone intersection is only about 5m from the earlier intersection in TRCD733 and demonstrates how rapidly the character of high grade gold mineralisation can change from banded pyrite to massive pyrite over a short distance.

The 4.75m at 11.16g/t gold from 198.25m in TRCD827 is located 10m south of TRCD733 and TRCD825 high grade intercepts. This intersection is at the base of the BIF so equates to the Lower Zone.

Hole TRCD821 located 10m north of TRCD733 and TRCD825 intersected 2.0m at 9.1g/t gold from 205m within a broader zone of 7.8 metres at 3.2 g/t Au from 199.2.

On the east side of the tonalite a series of wide spaced step-out holes yielded only anomalous BIF hosted gold intercepts with the peak value being TRCD824A: 1m grading 3.2g/t gold from 230m downhole. However, gold mineralisation was encountered in quartz veins in the metabasalt to the east of the tonalite with a peak value in TRCD820 of 4.8m grading 48.26g/t gold from 114.2m downhole.

The best tonalite hosted vein intercept was TRCD824A: 1m grading 21.15g/t gold from 301m downhole

Complete results are compiled in Table 1 and displayed on Figure 1.

An eight hole follow-up program is planned to further test the BIF hosted gold mineralisation on both the east and west sides of the tonalite and will commence in January 2010.

MAPPING AND SAMPLING

The outcropping BIF in the Two Mile Hill – Shillington area was the focus of a detailed geological mapping and rock sampling effort to understand the structural controls on the gold mineralisation. Rock chip grab sampling of the outcropping BIF returned a best value of 5.12g/t gold taken from a small laterite pit on the northeast slope of the BIF outcrop to the southwest of the Two Mile Hill Pit (see Figure 2). Gold anomalism is centred around a north-northeast plunging synform-antiform in the BIF just to the northwest of the Shillington Pit. The high grade mineralisation in TRCD733 is interpreted to be in the down plunge position of this structure.

An earlier drilled RC hole, TMR045, tested the shallow position of the structure 47m down plunge, intersecting 3m at 14.78g/t gold in brecciated BIF. Additional RC drilling is proposed to the east and west of this hole as well as up dip to further define the mineralisation in this structure at a shallow depth. This new target, named Shillington North, will also be tested with a 12 hole RC program in the March quarter.

To view Figure 1, please click on the following link: http://media3.marketwire.com/docs/try129f1.pdf

To view Figure 2, please click on the following link: http://media3.marketwire.com/docs/try129f2.pdf

To view Table 1, please click on the following link: http://media3.marketwire.com/docs/try129t1.pdf

Information of a scientific or technical nature in this report was prepared under the supervision of Peter J. Doyle, Vice President Exploration and Business Development of Troy, a "qualified person" under National Instrument 43-101 – "Standards of Disclosure for Mineral Projects", a member of the Australasian Institute of Mining and Metallurgy. Mr. Doyle has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a "competent person" as defined in the 2004 edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Doyle has reviewed and approved the information contained in this report. For further information regarding the Sandstone project, including a description of Troy's quality assurance program, quality control measures, the geology, samples collection and testing procedures in respect of the Sandstone project please refer to the technical report entitled Troy Resources NL: Sandstone Gold project, Mid West Region Western Australia" dated June 2007, which is available under the Company's profile at www.sedar.com.

This report contains forward-looking statements. These forward-looking statements reflect management's current beliefs based on information currently available to management and are based on what management believes to be reasonable assumptions. A number of factors could cause actual results, performance, or achievements to differ materially from the results expressed or implied in the forward looking statements. Such factors include, among others, future prices of gold, the actual results of current production, development and/or exploration activities, changes in project parameters as plans continue to be refined, variations in ore grade or recovery rates, plant and/or equipment failure, delays in obtaining governmental approvals or in the commencement of operations.

ABOUT TROY RESOURCES

Troy Resources (TSX:TRY)(TRY:ASX:) is a dividend-paying junior gold producer, with a clear growth strategy. The Company has two producing gold operations; at Sandstone in Western Australia and the Andorinhas Mine in Para State, Brazil and a gold silver development project, Casposo, in San Juan province, Argentina.

Troy has an experienced Board and management team with a portfolio of successful, fast-track mine development and low-cost operations.

Troy has an annual exploration budget of $5 million and a proven track record in exploration discoveries and strategic acquisitions.

Troy is currently focused on developing its Casposo Project, which it acquired in May 2009. With the acquisition and development of Casposo, Troy is entering a renewed growth phase which will again lift the Company's annual gold production above 100,000 ounces of gold per annum.

The Company maintains a robust balance sheet, and its current assets are forecast to continue to generate strong cash flow. Troy's gold production is unhedged; allowing its shareholders access to the full benefit of current and future gold price upside.

With the recent Casposo acquisition, Troy is positioned to continue its path of strong growth and profitable operations and is well on track to achieve its vision of becoming a highly profitable mid-tier gold producer with a portfolio of quality long-life assets.

Troy is a responsible corporate citizen, committed to the best practice of health and safety, environmental stewardship and social responsibility.

To view the Project Locations map, please click on the following link: http://media3.marketwire.com/docs/try129m1.pdf

ABN 33 006 243 750

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