Goldrush Resources Ltd.

Goldrush Resources Ltd.

August 29, 2006 09:30 ET

Goldrush Reports Second Quarter 2006 Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews – Aug. 29, 2006) - Goldrush Resources Ltd. (TSX VENTURE:GOD) today announced its second quarter 2006 financial results. All amounts are expressed in Canadian Dollars.

The Company’s net loss for the six months ending June 30, 2006 was ($441,838) or ($0.01) per share compared with a net loss of ($26,055) or $0.00 per share for the same period in 2005. The largest contributor to the increased loss in 2006 was a stock-based compensation expense of $286,370, which relates to the fair value of stock options and agent warrants granted. During the period, stock options were granted to key members of management and employees whose contributions were deemed to be important to the exploration success of the Company. Agent warrants were issued as compensation for assistance in financing the Company as it raised funds through two successful private placements. The accretion of debt, which relates to the Company’s convertible debenture to High River Gold Mines Ltd., provided a charge of $29,382. Other expense categories were also increased in the first six months of 2006 as a result of increased corporate activity. These expense categories include: management fees ($30,000 in 2006 vs $15,000 in 2005), higher trust and filing fees ($26,966 in 2006 vs. $16,231 in 2005), shareholder communication expenses ($19,836 in 2006 vs. $3,014 in 2005), travel expenses ($10,484 in 2006 vs. nil in 2005), and legal and accounting ($20,264 vs $16,350 in 2005). These higher costs were partially offset by increased bank interest ($5,566 in 2006 vs $939 in 2005).

The Company’s net loss for the three months ending June 30, 2006 was $369,878 or $0.00 per share compared with a net loss of $26,330 or ($0.00) per share for the same period in 2005. The increased loss in 2006 was due to similar increases in expenses as discussed above for the six month period.

The Company had net working capital of $3,299,421 at June 30, 2006, as compared to working capital of $38,169 as at December 31, 2005. The Company’s increase in working capital is a result of the $700,000 received from the exercise of 7,000,000 share purchase warrants in Q1 and the $3,520,000 received from two private placements in Q2, 2006.

Property Exploration

In January, 2006, the Company acquired 21 gold exploration permits in Burkina Faso, West Africa from High River Gold Mines Ltd. (“High River”). Subsequent property acquisitions have increased the number of permits controlled to 27 that cover approximately 5,100 km2 of prospective geology in Burkina Faso. The Company is now conducting a $2.5 million exploration program on these permits. Details of this exploration program are available at the Company’s website: As at the date of this report, preliminary exploration programs have been completed on the majority of the Company’s exploration permits and initial exploration results have been reported in news releases dated May 31, July 19 and July 27, 2006. Rotary air blast drilling on the Tougouri and Nomikdou permits and seven reverse circulation drill holes on the Kongoussi 1 permit have been completed; assay results are expected imminently. Targets for additional drilling programs are currently being evaluated, and drilling on several other permits is planned before the end of 2006.


Len Brownlie, President

FORWARD-LOOKING STATEMENTS: This news release contains certain "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. Except for statements of historical fact relating to the company, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future and other factors. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.

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

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