Estrella Gold Corporation
TSX VENTURE : EST

Estrella Gold Corporation

August 09, 2011 08:45 ET

Estrella Announces Initial Drill Results from Colpayoc Gold Project, Peru

TORONTO, ONTARIO--(Marketwire - Aug. 9, 2011) - Estrella Gold Corporation (TSX VENTURE:EST) ("Estrella" or the "Company") is pleased to announce initial drilling results from the Colpayoc gold project, 12 km southwest of the Yanacocha gold mine in northern Peru. The Colpayoc property contains 5,774 hectares (57.7 square kilometers) with gold and silver mineralization in three areas. The Company has completed 8 holes, totalling 1,093.7 meters of core drilling on the Daylight Gold Zone. Drilling is continuing on other target zones on the property, including the Cerro Rico silver-gold zone. Drilling was planned to expand size of the NI 43-101 compliant gold resource at the Daylight Zone. A new resource estimate will be prepared following completion of drilling. Drill holes were located at both in-fill and step-out drill sites from the current resource and are intended to provide data necessary to expand the gold resource. Drill results contain the following significant assay intervals:

Drill Hole Total Depth (m) Azimuth Inc. From (m) To (m) Interval (m) Gold g/t (Au)
COL - 04 140.0 270 -50 0.0 140.0 140 m 0.55 g/t
COL - 05 158.0 270 -50 3.5 73.2 69.7 m 0.72 g/t
Inc 9.5 18.5 9.0 m 0.90 g/t
Inc 26.0 54.0 28.0 m 1.03 g/t
And 95.9 157.0 61.1 m 0.58 g/t
Inc 95.9 106.8 10.9 1.02 g/t

These first two drill holes encountered wide zones of gold mineralization consistent with a large, near-surface oxide gold system. The depth of oxidation ranges approximately from 45 – 80 meters vertical depth. Drill holes intercepted projected zones of previously identified gold mineralization hosted in an altered porphyritic intrusive of probably Tertiary age, and occurring with variable quartz+/magnetite+/iron oxide stockwork and pervasive sericitic alteration. These two drill holes extend the continuous zone of gold mineralization an additional 100 meters to the south (see attached 2 maps). Drill hole COL 04 contained gold mineralization grading in excess of 0.3 g/t from top to bottom (140 meters) and was ended while still in mineralization. Drill hole COL 05 contained a total of 130.8 meters of mineralization grading more than 0.3 g/t gold, and also ended in mineralization greater than 0.2 g/t gold. These drill results indicate the Daylight Gold Zone remains open at depth, and in all directions (see attached map). The assay results from the remaining five holes in the Daylight Zone are expected by early September.

Keith Laskowski, President and CEO of Estrella commented: "We are very pleased with these results. The rocks and alteration are consistent with our predictions and the system appears to be getting stronger to the south. The drill results will increase the size of the area with sub-surface sampling (drilling) which will allow us to increase the size of our gold resource at the Daylight Zone, which is shaping up as a potential oxide, bulk-mineable target."

The Daylight Zone has been the focus of most work at Colpayoc and contains oxidized, outcropping gold mineralization hosted within a porphyry gold system. The zone contains a 400 meter diameter area of outcropping gold mineralization, surrounded by sedimentary rocks. Based on previous drill results, SRK Consultants calculated an initial NI 43-101 compliant inferred resource (2010) containing 7.6 million tonnes @ 0.6 g/t gold with 144,600 ounces of gold (0.3 g/t cutoff). Exploration data indicates that the Daylight Gold Zone has potential to contain a much larger gold resource. The Daylight Gold Zone is hosted within a Cretaceous – Tertiary age gold porphyry system that was intruded into Cretaceous sedimentary rocks. Mineralization may extend both beneath the sedimentary contact and within the sediments. There are many additional targets in adjacent areas to the Daylight Zone and the Company has identified high grade silver and gold mineralization two kilometers northwest at the Cerro Rico Zone. The geology and gold mineralization are similar to Goldfield Mining Corporation's Cerro Corona mine located 38 km to the north.

QA/QC: Assay results identify those mineralized intervals that contain a minimum continuous width of 6.0 meters with a minimum gold content of 0.3 g/t. Only one internal or adjacent interval of dilution is allowed. Higher grade intervals are calculated using a minimum continuous width of 6.0 meters with a minimum gold content of 0.8 g/t gold. Drill hole samples were collected in accordance with accepted industry standards and procedures. The samples were submitted to the ALS Chemex Labs (ISO 9001:2000 accredited) in Lima, Peru for analysis. Gold was analyzed by fire assay with an AAS finish and multi-element analyses were determined with aqua regia digestion and ICP MS/AAS techniques. The Company conducts routine QA/QC analysis on all assay results, including the systematic utilization of certified reference materials, blanks and field duplicates.

About the Colpayoc NI 43-101 Compliant Gold Resource: The initial resource estimate was prepared by SRK Consulting (U.S.) Inc. as part of a NI 43-101 Technical Report completed in June 2010. The resource estimate contained the following:

Colpayoc Daylight Gold Zone: Inferred Resource (0.30 g/t low-grade cutoff):

Oxide: 4,663,275 tonnes @ 0.59 g/t containing 87,800 oz
Reduced: 2,913,019 tonnes @ 0.61 g/t containing 56,800 oz
Total: 7,576,293 tonnes @ 0.60 g/t containing 144,600 oz gold

The block model utilizes an inverse-distance squared (ID2) model, with 6m x 10m x 10m block sizes, using Mintec's MineSight software. All gold mineralization is hosted within sheeted and stockwork quartz+/magnetite+/pyrite-iron oxide veins, hosted within a highly altered granitic intrusion. Oxidation extends to approximately 45 meters depth, and preliminary bottle-role tests on surface trench samples indicate favorable recoveries for oxidized material. The outcropping area of the intrusion is almost entirely altered and mineralized, however overlying sedimentary rocks limit the exposure of this mineralized rock. Although the property has received only a small amount of drilling, due to the consistent and broad areas of gold mineralization, the Company has prepared this initial gold resource estimate to guide future exploration and expansion of the resource. This initial resource estimate benefits from extensive surface trench data, however the small number of drill holes generally limits the extent of interpolated mineralization at depth. The four drill holes penetrated consistent mineralization to the end of each hole (200 meters), however resources can only be included adjacent to the drill holes, and between the drill holes on interpreted northeast structural trends, until additional drilling is completed. There is exploration potential beneath mineralized trenches that is not fully tested by drilling.

About Estrella Gold Corporation (TSX VENTURE:EST) Estrella Gold is a "Prospect Generator" focused on gold in Latin America. The Company's dual strategies focus on 1) generating new prospects/discoveries and 2) increasing the Company's inventory of gold resource ounces. Estrella has a NI 43-101 compliant inferred gold resource of 144,600 ounces at its Colpayoc project in Peru, and additional historic non-compliant gold resources. Mr. Keith A. Laskowski, MSc., is a Qualified Person for the purposes of National Instrument 43-101 Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators, and has prepared, reviewed and verified the technical information contained in this news release. Estrella Gold has seven precious metal exploration projects in Perú and one in Chile. The Company has 24.1 million shares issued and outstanding on the TSX Venture Exchange (TSX VENTURE:EST). Further information is available at Estrella Gold's website: www.estrellagold.com.

STATEMENTS IN THIS NEWS RELEASE, OTHER THAN PURELY HISTORICAL INFORMATION, INCLUDING STATEMENTS RELATING TO THE COMPANY'S FUTURE PLANS AND OBJECTIVES OR EXPECTED RESULTS, MAY INCLUDE FORWARD-LOOKING STATEMENTS. FORWARD-LOOKING STATEMENTS ARE BASED ON NUMEROUS ASSUMPTIONS AND ARE SUBJECT TO ALL OF THE RISKS AND UNCERTAINTIES INHERENT IN RESOURCE EXPLORATION AND DEVELOPMENT. AS A RESULT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE DESCRIBED IN THE FORWARD-LOOKING STATEMENTS.

To view the maps associated with this press release, please visit the following links:

http://media3.marketwire.com/docs/estrellamap1.pdf

http://media3.marketwire.com/docs/estrellamap2.pdf

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