Goldstone Resources Inc.

Goldstone Resources Inc.

January 11, 2011 08:15 ET

Goldstone Announces Balance of 2010 Drilling Results, Plans More Intensive 2011 Program for Key Lake, Beardmore

Highlights: 1.60 g/t Over 45 m and 1.54 g/t Over 31.6 m

TORONTO, ONTARIO--(Marketwire - Jan. 11, 2011) - Goldstone Resources Inc. (TSX:GRC) (PINK SHEETS:GRSZF) today announced final results of Phase 2 of the 2010 drilling program on its 100% owned Key Lake property located just west of Geraldton, Ontario.

The Key Lake property is contiguous to the Hardrock Project where diamond drilling by the Company's joint venture partner, Premier Gold Mines Ltd. (TSX:PG) as operator, has established a significant gold resource near surface as well as high grade intersections at depth. Goldstone holds a 30% carried interest in the Hardrock Project.

The 2010 Key Lake drilling program, which totaled 12,430 metres, was focused on identifying near surface gold mineralization amenable to open pit mining.

A summary of significant Phase 2 intersections:

Hole No. UTM UTM AZI Dip From To Interval Au
  N E     (m) (m) (m) (g/t)
KL-10-28 5506232 492381 192 -47 62.0 75.5 13.5 1.07
KL-10-29 5506183 492237 12 -47 89.6 119.0 29.4 0.44
KL-10-31 5506289 492260 192 -60 22.0 34.0 12.0 2.07
          102.0 121.0 19.0 3.58
        including 106.5 108.0 1.5 39.90
KL-10-32 5506086 492215 12 -54 247.3 251.6 4.3 1.05
KL-10-33 5506502 491553 12 -47 74.0 81.0 7.0 1.92
KL-10-34 5506456 491492 12 -47 129.0 145.0 16.0 2.92
KL-10-35 5506456 491492 12 -62 176.6 180.0 3.4 0.66
KL-10-36 5506173 492148 12 -47 99.0 121.0 22.0 0.56
KL-10-37 5506221 492159 12 -60 67.0 86.7 19.7 1.10
          117.0 127.8 10.8 0.74
KL-10-38 5506195 492125 12 -47 113.0 127.0 14.0 0.51
KL-10-39 5506195 492125 12 -58 115.0 191.0 76.0 0.94
        including 115.0 134.0 19.0 1.12
        including 162.0 191.0 29.0 1.36
KL-10-40 5506203 492106 12 -47 96.0 136.4 40.4 0.69
KL-10-41 5506217 492030 12 -47 43.8 68.9 25.1 0.77
KL-10-43 5506280 491991 12 -47 100.0 121.0 21.0 0.80
KL-10-44 5506337 491950 12 -47 135.0 150.0 15.0 2.06
KL-10-45 5506337 491950 12 -65 133.0 141.0 8.0 1.09
KL-10-46 5506304 491870 12 -47 133.0 164.6 31.6 1.54
KL-10-47 5506340 491827 12 -47 96.0 129.0 33.0 1.13
KL-10-48 5506340 491827 12 -61 125.0 191.0 66.0 0.71
        including 125.0 147.0 22.0 0.87
        including 172.0 191.0 19.0 1.29
KL-10-49 5506534 491792 192 -47 130.0 149.0 19.0 0.52
KL-10-50 5506534 491792 12 -61 159.0 204.0 45.0 1.60
KL-10-51 5506332 491775 12 -60 68.0 74.0 6.0 2.46
          183.0 190.0 7.0 0.90
          225.0 239.0 14.0 2.45
KL-10-52 5506363 491712 12 -47 155.0 156.0 1.0 26.80
KL-10-53 5506363 491712 12 -64 195.0 199.0 4.0 7.72
KL-10-54 5506406 491687 12 -61 135.0 140.0 5.0 1.29
*True width of the zone is between approximately 70 to 85% of drilled internal.          

Mike Kilbourne, P.Geo., is the Qualified Person for the information contained in this news release and is a Qualified Person within the meaning of National Instrument 43-101.

2010 drilling at Key Lake was completed on approximately 1,000 metres of the 2.5 Km of mineralized horizon with the joint objectives of twinning historical holes drilled in the 1990s by Placer Dome and Cyprus Canada and on filling in gaps and exploring more of the zone's strike length. Recent and historical drilling has confirmed the presence and continuity of near surface gold mineralization between clusters of drill holes. In addition, drilling has established the existence of high grade gold mineralization , with hole KL-10-31 grading 39.90g/t (1.29 oz/t) over 1.50 m and hole KL-10-52 intersecting 26.80g/t (0.86 oz/t) over 1 m.

"We are encouraged by these results, particularly given the relatively modest amount of drilling we have done at Key Lake," said Goldstone Chairman and Interim CEO, Philip Cunningham. "With the $6.5 million in funding provided by our December 2010 financing, we plan to follow up with a significantly more intensive program in 2011 beginning in the first quarter, based on results to date and a preliminary open-pit model we are developing. Our continuing objective is to establish the viability of an open pit mining operation at Key Lake and to build a NI 43-101 resource."

"At the same time, in 2011 we will be committing significant resources to our 100%-owned Northern Empire and Leitch-Sand River properties in the Beardmore camp and are planning a far more intensive drilling program for this year to pursue several promising targets identified by aeromagnetic survey, historical data, and recent exploration."

"Last year, due to lack of funding, just six holes were drilled on these properties with no significant results, but we are learning more as we go. For example, the McWilliams prospect south of the Northern Empire Mine returned 0.78 g/t over 9.9m in hole NE-10-03. We will be following up with additional drilling on this horizon, which has an apparent strike length of over 1,000 meters."

"As we've said before, our objective in Beardmore is to develop more gold resources near our Northern Empire mill which could be developed sequentially with those identified at our Brookbank and Northern Empire properties", Cunningham stated. "In the meantime, we will continue to assess a number of other factors which influence the economics of development for these properties before proceeding with a comprehensive study."

Overall this year Goldstone plans to drill approximately 50,000 metres at its Key Lake and Beardmore properties, about four times as much as last year.

About Key Lake

The Key Lake property hosts the former Jelex Mine and has an approximate strike length of 2.5km, of which 1.5 Km has seen limited drilling. Historic drilling by Cyprus Canada in the mid- 1990's outlined a 40-50m wide zone of disseminated gold with a higher grade core comprised of quartz-feldspar porphyry. The most significant historical assay from the Cyprus drilling was for hole 195-94 which intersected 1.10 g/t over 86 metres. The Jelex Mine had historical production of 5,675 oz of gold recovered from milling 14,722 tons of ore graded 0.38 oz Au/t.

On-site Quality Assurance/Quality Control Measures

All samples have been shipped to Activation Laboratories, an accredited mineral analysis laboratory in Geraldton, Ontario. Analyses were performed using fire assays in the Activation Laboratories in Thunder Bay, Ontario All core samples were selected by the Goldstone site geologist, and were cut in half by diamond core saw. Individual samples were labeled, placed in plastic sample bags and sealed. Groups of samples were then placed into durable rice bags that were secured by project security tags for shipping. The remaining coarse reject portions of the samples remain in storage at the Activation Laboratories storage facility in Geraldton as required in the event that further work is needed.

Independent Quality Assurance and Quality Control Protocol

A QA/QC program has been implemented to monitor all assays from the current drilling program. Samples are assembled in numbered batches. Included in each batch of 38 samples are two certified reference standards, two laboratory duplicates, one blank sample comprised of silica sand and one core duplicate sample. This QC program was set up for Goldstone Resources by Tracy Armstrong, P. Geo, of T.J. Armstrong Geological Consulting Inc. Ms. Armstrong is a qualified geologist in the Provinces of Ontario, Quebec and British Columbia.

About Goldstone

Goldstone Resources Inc. is a well-financed gold exploration and development company operating in the historically significant Geraldton-Beardmore camp of Northwestern Ontario and focused on gold exploration and deposit delineation at its Key Lake, Brookbank, Northern Empire and Leitch-Sand River gold properties, and as a partner in the Hardrock Project joint venture with Premier Gold. A preliminary assessment of the Brookbank deposit is being carried. The camp is host to several past producers in a district that has historical production of more than 4.1 million ounces of gold from high grade ore before being shut down primarily as a result of a $35 gold price—and to Goldstone's fully permitted, expandable 200-TPD Northern Empire mill.

Further information is available on the Company's website at and on SEDAR under the Company's profile at

Forward-Looking Statements

This news release may contain forward-looking information under applicable securities laws concerning Goldstone's business, operations, financial performance, condition and prospects, as well as management's objectives, strategies, beliefs and intentions. Forward looking information is frequently identified by such words as "may", "will", "plan", "expect", "anticipate", "intend" and similar words referring to future events and results. This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those implied by the forward-looking information. Factors that may cause actual results to vary materially include, but are not limited to, inaccurate assumptions concerning the exploration for and development of mineral deposits, delay or inability to retain a senior exploration and/or operating officer, unanticipated operational or technical difficulties, changes in laws or regulations, the risks of obtaining necessary licenses and permits, changes in general economic conditions and changes in conditions in the financial markets. Readers are cautioned not to place undue reliance on this forward-looking information as actual results may differ materially from those expressed or implied in the forward looking information. Goldstone does not assume the obligation to revise or update this forward- looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.

Neither Toronto Stock Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Goldstone Resources Inc.
    Philip Cunningham
    Chairman and Interim CEO
    (416) 860-1636