Canstar Resources Inc.

Canstar Resources Inc.

September 05, 2007 15:26 ET

Canstar Update on the Mary March Appeal and McFaulds Lake Properties

TORONTO, ONTARIO--(Marketwire - Sept. 5, 2007) - The Directors of Canstar Resources Inc. (TSX VENTURE:ROX) are pleased to announce that the date for the Mary March appeal (Vinland Resources Limited) and cross-appeal (Phelps Dodge Corporation-Canstar Resources) of the Supreme Court of Newfoundland's 2006 ruling has been set for October 16th and 17th, 2007. Management views this as a significant step towards a resolution to the dispute, as we now have a definitive timeline for presenting our cross-appeal to the Court.

The cross-appeal asks that the matter of title regarding Mary March be dealt with at the court level, as Canstar believes the dispute rests on a point of law, which is best decided by the panel of Appeal Judges. A decision on our cross appeal would provided the speediest resolution to the dispute, obviating the need for a second Adjudication Board hearing.

The dispute began in 2000, when a privately held Newfoundland company, Vinland Resources Limited, filed applications seeking Map Staking Licenses over the core Mary March discovery areas. The Mineral Claims Recorder (Newfoundland), on the basis of evidence that the lands in question had been privately held since 1905, rejected the applications. On December 20, 2000, Vinland Resources Limited filed a grievance with the Mineral Rights Adjudication Board, asking that the Mineral Claims Recorder's decision be overturned. In a ruling handed down December 17, 2003, the Mineral Rights Adjudication Board decided against the Province and titleholders. On January 8, 2004, the Province filed an appeal on behalf of the Mineral Claims Recorder before the Supreme Court of Newfoundland and Labrador, which resulted in the 2006 Supreme Court decision.

In July 2006 the Supreme Court overturned the decision of the Mineral Rights Adjudication Board, which had previously favoured Vinland Resources, after determining that the original Board decision improperly placed the burden of proof on the Mineral Claims Recorder, had applied an incorrect standard of proof and had failed to address the evidence before it. The matter was ordered to be reheard by a different panel, in accordance with the guidelines in the judgment.

Vinland filed notice of appeal in August 2006 and Phelps Dodge-Canstar responded with the cross-appeal asking that Vinland's claim be dismissed without a rehearing.

The Board of Directors and management of Canstar are focused on the successful resolution of the Mary March dispute, and will continue to keep investors informed of any updates or developments.

McFaulds Lake

A recent base metal discovery of potential economic significance in the McFauld's Lake Volcanic Belt of the James Bay Lowlands (Ontario) has been identified less than 20km from Canstar's McFauld's 1 and McFauld's 3 properties.

Noront Resources has recently announced a significant base metal sulphide intersection in two drill holes on its Condor/Greenstone Option property within the McFauld's Lake belt. The holes intersected 69-metre and 72-metre intervals, respectively, of copper-bearing sulphides in an ultramafic host (see Noront Press Release, August 28, 2007). Owing to the geological setting, the potential for nickel mineralization is considered high.

Canstar is now reviewing the data for its properties in order to assess future exploration programs.

Canstar's shares trade on the TSX Venture Exchange under the symbol ROX.

David Palmer, Ph.D., P.Geo., is the qualified person for all technical information in this release. To find out more about Canstar Resources, visit our website at

This News Release includes certain "forward-looking statements". All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding potential mineralization and reserves, exploration results and future plans and objectives of Canstar, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Canstar's expectations are exploration risks detailed herein and from time to time in the filings made by Canstar with securities regulators.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

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