Cornerstone Capital Resources Inc.

Cornerstone Capital Resources Inc.

October 27, 2005 08:00 ET

Cornerstone & Agnico-Eagle Report El Strato Gold Project Results

MOUNT PEARL, NEWFOUNDLAND--(CCNMatthews - Oct. 27, 2005) - Cornerstone Capital Resources Inc. (TSX VENTURE:CGP) and its joint venture partner Agnico-Eagle Mines Ltd. (TSX:AGE) are pleased to report results to date from Phase I drilling on the El Strato Gold Project, Baie Verte Peninsula, Newfoundland. Five diamond drill holes, comprising 702 metres in total length, were completed in widely spaced intervals over a total distance of approximately 1 km. The drill holes tested showings which consist of high-grade quartz veins in outcrop and boulders, coincident with gold-in-soil geochemical anomalies and IP geophysical anomalies. ( Assays from the program range up to 10.6 g/t Au over 1.13 m. Additional drilling is underway.

Commenting on the drill program results, Cornerstone's Vice-President, Exploration, Mike Basha, said: "We are very encouraged by these results. They come from widely spaced drill holes over an area that has virtually no outcrop. They confirm the potential for more significant zones of mineralization as indicated by the many gold-in-soil geochemical and coincident IP geophysical anomalies on the property."

Highlights of results to date from the drill program are summarized below. The best assays are associated with narrow, sulphide-bearing quartz veins within wide zones of strong, to intense quartz-carbonate alteration.

El Strato Gold Project Phase I Drill Results

Drill hole From To Interval Au Ag
(m) (m) (m) (g/t) (g/t)
ES-05-01 129.57 130.70 1.13 10.6 1.1
ES-05-02 9.30 9.40 0.10 12.9 81.5
ES-05-03 116.60 117.90 1.30 0.8 0.86
ES-05-04 79.80 80.10 0.30 6.4 26.4
ES-05-05 85.4 86.5 1.10 4.1 3.0

The property hosts several high-grade gold occurrences in outcrop as well as abundant large (greater than one metre in diameter), un-sourced, quartz boulders which assay up to 106.7 g/t Au and coincide with soil geochemical anomalies up to 2,600 ppb Au and strong IP chargeability geophysical anomalies. The occurrences and anomalies collectively define distinct northeasterly trends extending over a distance of 2 km in the southern portion of the property. In addition to the additional drilling, 1,000 B-horizon soil samples are currently being assayed and additional IP geophysical surveys are planned for the winter period.

Under the joint venture agreement Agnico-Eagle Mines Ltd. can earn an initial 51% interest in the El Strato property by spending $1,950,000 on exploration and paying Cornerstone $150,000 over four years. Agnico-Eagle may increase its interest to 61% by funding a bankable feasibility study, and to 75% by assisting Cornerstone to arrange mine financing. Cornerstone will operate the exploration program until Agnico-Eagle earns an interest. Agnico-Eagle is committed to incurring exploration expenditures of $250,000, which commitment is expected to be fulfilled on completion of the current program of diamond drilling, mapping, prospecting, soil geochemical surveys and IP geophysical surveys.

Mineralized diamond drill core was sampled by splitting the core longitudinally with a diamond saw. One half of the core was used for assay and the other retained for future reference. Eastern Analytical Laboratories Ltd. of Springdale, Newfoundland & Labrador, assayed all samples. Gold was determined by fire assay and other elements by Inductively Coupled Plasma Spectrometry (ICP). A method of quality control, involving check assaying and insertion of previously prepared standards for each batch of 30 samples was maintained throughout the program.

Cornerstone wishes to acknowledge funding assistance for the drilling program from the Government of Newfoundland & Labrador under the Junior Company Exploration Assistance Program (JCEAP).

In other news, Agnico-Eagle Mines Ltd. recently informed Cornerstone of its decision to terminate its option on the Colchester Project.

This press release was prepared by Mike Basha, P.Eng., P.Geo., Vice President of Exploration for Cornerstone and a Qualified Person as defined by National Instrument 43-101. Bruce Mitton., P.Geo., is the qualified person supervising field programs at El Strato.

On Behalf of the Board of Directors
Glen H. McKay

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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