Cornerstone Capital Resources Inc.
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Cornerstone Capital Resources Inc.

August 11, 2011 08:00 ET

Cornerstone and Intrepid Report Final Results for Phase 1 Diamond Drilling at the Gama Prospect in Ecuador

MOUNT PEARL, NEWFOUNDLAND--(Marketwire - Aug. 11, 2011) - Cornerstone Capital Resources Inc. ("Cornerstone") (TSX VENTURE:CGP) (FRANKFURT:GWN) (BERLIN:GWN) (PINK SHEETS:CTNXF) and Intrepid Mines Limited (ASX-IAU)(TSX-IAU) today announced that they have completed and received all assay results for the Phase 1 diamond drilling program on the Gama prospect, located in the northwestern part of the Shyri property in southern Ecuador. Eleven (11) holes totaling 3,153 metres were drilled between March 6th and July 17th. Drill progress proved relatively slow owing to the rugged topography and wet conditions encountered during the annual rainy season. Assay results for holes GAD-11-001 to GAD-11-005 were released on May 31, 2011, which highlighted a gold-enriched porphyry intersection grading 0.71 g/t Au over 45 metres in hole GAD-11-002. A summary of assay results for the remaining six holes of the program, holes GAD-11-006 to GAD-11-011 inclusive, is provided below in Table 1.

Highlights:

  • Hole GAD-11-011 intersected 26 metres at 0.45 g/t gold within a porphyry environment.

"The Phase 1 scout drilling program at Gama has confirmed the large size of this porphyry – epithermal system, and two holes have encountered broad zones of gold mineralization within the porphyry" said Brooke Macdonald, Cornerstone's President. "The information generated from this initial drill program will allow us to adjust and refine our target models, and we look forward to planning the next work phase along with our partner Intrepid".

Table 1: Summary of Gama Drill Results, Holes GAD-11-006 to GAD-11-011, Phase 1 Program

Hole No. Target Elevation (masl) Length
(m)
From
(m)
To
(m)
Interval
(m)*
Au
(g/t)
Ag
(g/t)
Cu
(ppm)**
Mo (ppm)
GAD-11-006 C 3690 244.0 90.0 92.0 2.0 0.25
GAD-11-007 Ermita Breccia 3819 400.8 No significant values
GAD-11-008 Epithermal 3859 361.2 No significant values
GAD-11-009 B 3737 277.4 5.0 191.0 186.0 78
including 22.0 24.0 2.0 0.13
30.0 35.0 5.0 0.18 104
43.0 46.0 3.0 241
67.0 72.0 5.0 0.10
108.0 116.0 8.0 681
GAD-11-010 B 3651 350.5 0.0 48.0 48.0 76
including 26.0 38.0 12.0 125
128.0 136.0 8.0 0.11%
GAD-11-011 B North 3498 256.0 144.0 170.0 26.0 0.45 111
including 158.0 160.0 2.0 1.73

* The reported intervals are core lengths. At present the true thicknesses are uncertain due to the early stage of drilling.

** Copper reported in parts per million (ppm) except where indicated in %.

"Intrepid is encouraged by these results. The porphyry system contains anomalous copper and, in places, highly anomalous molybdenum, together with local areas of gold enrichment. The assay results will be reviewed in their geological context to establish vectors to better mineralisation" said Malcolm Norris, EGM Exploration and New Business at Intrepid Mines.

Gama Prospect

The Gama prospect is one of three recognized thus far on the Shyri property, and comprises an extensive zone of high sulphidation (HS) epithermal alteration measuring a minimum of 8.5 km by 3 km. The alteration is strongly zoned and centered over two high level, porphyry-type intrusions at the 3500 m to 3800 m elevations. Gama is strategically located between the Quimsacocha 3.4 Moz HS epithermal gold deposit 15 km to the east and the Chaucha porphyry copper deposit (216 Mt at 0.4% Cu) 10 km to the west.

Phase 1 Drill Program

As previously announced on March 8th, 2011, Cornerstone and Intrepid approved an 11 hole, 2,900 metre diamond drilling program designed to test various targets defined on the basis of surface geochemistry (rock and soil samples), detailed geology, magnetics and 3-D interpretation of Induced Polarization (IP) geophysical data. The program is targeting both HS epithermal gold-silver and porphyry copper-molybdenum-gold mineralization over an area measuring approximately 3 km north-south by 2 km east-west. None of the Gama targets have been drill-tested previously.

A map showing the location of targets and drill holes with respect to gold-in-soil anomalies and interpreted faults is provided here: http://cornerstoneresources.com/i/pdf/properties_GAMADDH0811.pdf.

Discussion

Hole GAD-11-006 was drilled to test target "C", a coincident Ag-Au-Hg-Bi soil anomaly which lies 250-500 m east of a series of north-northwest and north trending structures. Rock outcrops in the target area display advanced argillic and argillic alteration, and include silicified and vuggy hydrothermal breccias which have returned multi-element anomalies and are suggestive of the structural roots of an epithermal lithocap. The soil anomaly is coincident with a weak induced polarization (IP) chargeability shoulder on the flank of a strong IP chargeability anomaly to the west. The drill hole intersected a thick sequence of crystal and lapilli tuffs showing weak argillic alteration from surface to 210 m. A narrow interval from 90.0 to 92.0 m returned anomalous gold grading 0.25 g/t Au over 2.0 m. From 210 m to the bottom of the hole at 244 m, the volcanic sequence is moderately to strongly silicified and contains up to 10% disseminated pyrite but returned no anomalous gold or silver values.

Hole GAD-11-007 targeted the Ermita Breccia, a late hydrothermal breccia that is interpreted to source a flat lying stratabound or stratigraphically-controlled disseminated HS epithermal mineralized zone at depth underneath the plateau. The Ermita breccia is located at the intersection of two regional structures which trend east-northeast and northwest, and which display linear magnetic lows interpreted to represent hydrothermal alteration corridors. A 100 X 120 m multi-element Au-Ag-As-Hg-Cu-Bi soil anomaly is present around the breccia outcrop. The hole intersected a thick pile of flat-lying andesitic and dacitic volcanoclastics and flows which form part of the Plancharumi Formation and the upper part of the Saraguro Group. These rocks show widespread weak argillic and propylitic alteration and traces of syngenetic pyrite, but no significant gold or silver was encountered.

Hole GAD-11-008 was designed to test for stratabound HS epithermal mineralization similar to and approximately 500 m south of GAD-11-007. The IP survey indicates resistivity and chargeability anomalies at depth. This hole intersected similar weakly argillic altered Plancharumi and Saraguro stratigraphy. An unmineralized hydrothermal breccia was intersected between 285 and 292 m. The most altered and mineralized portion of the hole was sampled, but no significant gold or silver values were returned.

Holes GAD-11-009 and GAD-11-010 tested target "B", representing the outer-upper fringes of a porphyry system characterized by a 2 km wide annular subdued magnetic high cross-cut by a series of north-northwest and northwest trending structures. A 1 km wide and annular Mo-in-soil anomaly is centered on the magnetic feature and is broadly coincident with a 1 km long linear Cu-in-soil anomaly. IP chargeability and resistivity anomalies coincide with the Cu and Mo geochemical anomalies. Hole GAD-11-009 intersected a microdiorite porphyry cross-cut by numerous, metric size (0.3 to 3.0 m), hydrothermal breccias. Advanced argillic alteration is present throughout most of the hole, and potassic alteration is present at depth. Anomalous gold (0.10 to 0.18 g/t Au) was intersected over 2 to 5 m widths. Molybdenum is anomalous (> 100 ppm Mo) over similar intervals with a maximum of 681 ppm Mo over 8 m from 108 to 116 m. Hole GAD-11-010 intersected a similar microdiorite porphyry cross-cut by numerous diorite dykes and hydrothermal breccias which display advanced argillic alteration. Mineralization is present in the form of disseminated pyrite (up to 10% from 0 to 100m), as well as minor molybdenite, covellite and enargite (0.1 to 0.3%). Anomalous molybdenum (12 m averaging 125 ppm Mo from 26 to 38 m) and copper (8 m averaging 0.1% Cu from 128 to 136 m) was encountered.

GAD-11-011 was drilled approximately 200 m north of target B, and was designed to test a strong IP chargeability anomaly within the semi-regional circular magnetic anomaly centred on target B. This hole intersected a microdiorite porphyry which is cross-cut by numerous hydrothermal breccias in the upper 105 m of the hole. The distribution of the alteration patterns (advanced argillic, weak potassic and some sericitic and propylitic at depth) and vein types suggest that the hole is located in the outer fringe of the central potassic zone of the porphyry system. Pyrite is the most common sulphide throughout the hole (up to 6%), and occurs as disseminations and as porphyry "B" and "D" veins. Significant gold mineralization (26 m at 0.45 g/t Au) was intersected in the microdiorite porphyry, associated with a highly fractured (faulted) zone from 144 to 177 m. This intersection shows geological similarities to the previously released 45 m at 0.71 g/t Au and 0.18% Cu intercept in drill hole GAD-11-002.

Between March 6th and July 17th, eleven (11) holes totaling 3,153 metres were completed, which allowed for the testing and further understanding of the multiple parts of the large porphyry-epithermal system as well as providing key information on the alteration and mineralization processes.

In late August, Cornerstone and Intrepid geologists will be jointly carrying out a thorough review and interpretation of the Phase 1 results in advance of planning the next work phase.

Logging, sampling and assaying

All holes drilled by Cornerstone are collared using HTW core size (7.1 cm diameter) and then reduced to NTW size (5.6 cm diameter) down the hole. Geotechnical measurements such as core recovery, fracturing, rock quality designations (RQD's), hardness and photographic logging are performed systematically prior to assaying. The core is logged, magnetic susceptibility measured and key alteration minerals identified using an on-site portable spectrometer. Core is then sawed in half at Cornerstone's core logging facility in Cuenca, Ecuador. Half of the core is delivered by Cornerstone employees for preparation at Acme Analytical Laboratories (ACME) facility in Cuenca. Core samples are prepared crushing 1 kg to 80% passing 2 mm (10 mesh), splitting 250 g and pulverizing to 85% passing 0.075 mm (200 mesh) (ACME code R200-250). Prepared samples are then shipped to ACME in Vancouver, Canada where samples are assayed for a multi-elements suite (ACME code 1E, 0.25g split, 4-acid digestion, ICP-ES finish). Gold is assayed using a 30 g split, Fire Assay (FA) and AA or ICP-ES finish (ACME code G601).

Quality assurance / Quality control (QA/QC)

The ACME preparation facility in Cuenca was audited by Cornerstone prior to the start of the drilling program and ACME is an ISO 9001:2008 qualified assayer that performs and makes available internal assaying controls. Duplicates, certified blanks and standards are systematically used as part of Cornerstone's QA/QC program. Rejects, a 100 g pulp for each core sample and the remaining half-core are stored in Cuenca for future use and controls.

Qualified Person

Yvan Crepeau, M.Ba., P.Geo, President of Cornerstone Ecuador SA and a qualified person in accordance with National Instrument 43-101, is responsible for supervising the Gama drilling program and has reviewed and approved the technical information contained in this news release.

Shyri Option Agreement

Intrepid Mines Limited ("Intrepid") is earning a 60% interest in the Shyri gold-silver-copper property under an option agreement signed with Cornerstone in January 2011. Under the terms of the Agreement, Intrepid has the ability to earn an initial 60% interest in the property by spending $US 6.0 million dollars over 5 years, with a firm commitment of $US 1.0 million in the first year. Intrepid may earn an additional 20% in specific project areas up to 5,000 hectares each. Upon designation of a Project Area, Intrepid will make a $US 750,000 private placement in Cornerstone. To earn the additional interest, Intrepid will complete a bankable feasibility study or incur expenditures of $US 20 million, whichever comes first, and make a cash payment to Cornerstone of up to $US 5.0 million based on the gold equivalent ounces in the mineral reserve. There is no limit to the number of Project Areas Intrepid may designate within the property and each 'stand-alone' Project Area requires the same earn-in requirements (see news release dated Oct 29, 2009). Cornerstone is the project operator, and manages the exploration programs in close consultation and planning with Intrepid.

About Cornerstone

Cornerstone Capital Resources Inc. is a mineral exploration company based in Mount Pearl, Newfoundland and Labrador, Canada, with a diversified portfolio of projects in Canada, Ecuador and Chile, and a strong technical team that has proven its ability to identify, acquire and advance properties of merit. The company's business model is based on generating exploration projects whose subsequent development is funded primarily through joint venture partnerships. The company is well funded and commitments from JV partners constitute significant validation of the strength of Cornerstone's projects.

Investors can access and join the following Cornerstone social media channels:

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The link to recent CEO audio interviews is: http://www.cornerstoneresources.com/s/Interviews.asp

The link to a recent Corporate presentation with narration is: http://rblcommunications.com/resources/CGP/1/CGPmay2011.html

Cautionary Notice:

This news release may contain 'Forward-Looking Statements' that involve risks and uncertainties, such as statements of Cornerstone's plans, objectives, strategies, intentions and expectations. The words "potential," "anticipate," "forecast," "believe," "estimate," "expect," "may," "project," "plan," and similar expressions are intended to be among the statements that identify 'Forward-Looking Statements.' Although Cornerstone believes that its expectations reflected in these 'Forward-Looking Statements' are reasonable, such statements may involve unknown risks, uncertainties and other factors disclosed in our regulatory filings, viewed on the SEDAR website at www.sedar.com. For us, uncertainties arise from the behaviour of financial and metals markets, predicting natural geological phenomena and from numerous other matters of national, regional, and global scale, including those of an environmental, climatic, natural, political, economic, business, competitive, or regulatory nature. These uncertainties may cause our actual future results to be materially different than those expressed in our Forward-Looking Statements. Although Cornerstone believes the facts and information contained in this news release to be as correct and current as possible, Cornerstone does not warrant or make any representation as to the accuracy, validity or completeness of any facts or information contained herein and these statements should not be relied upon as representing its views subsequent to the date of this news release. While Cornerstone anticipates that subsequent events may cause its views to change, it expressly disclaims any obligation to update the Forward-Looking Statements contained herein except where outcomes have varied materially from the original statements.

On Behalf of the Board,

Brooke Macdonald, President

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.

Contact Information

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