Greencastle Resources Ltd.
TSX VENTURE : VGN

Greencastle Resources Ltd.

October 16, 2006 10:20 ET

Greencastle Reports on Drilling at Coal Canyon, Nevada Oil Development Continues at Primate, Saskatchewan

TORONTO, ONTARIO--(CCNMatthews - Oct. 16, 2006) - Greencastle Resources Ltd (TSX VENTURE:VGN) has completed a diamond drill program at its Coal Canyon project, located on the Battle Mountain Trend south of Cortez, Nevada. The two reconnaissance holes, CC-23 and CC-24, were drilled some 650 feet apart, to depths of 1,366 feet at -65 degrees and 1,264 feet at -60 degrees respectively, to test the extension at depth and along strike from anomalous gold values within a mineralized zone of hydrothermal alteration in the vicinity of the Grouse Creek Fault. The drill holes intersected silicified Hamburg Dolomite in the immediate hanging wall of the fault, with CLC-23 encountering geochemically anomalous gold values up to 0.34 g/t gold over 2.4 feet within 38 feet of silicification averaging 0.17 g/t gold. Similar values extend for another 50 feet into footwall carbonaceous shales, mudstones and thin cherts of the Vinini formation. Gold values range from .05 to 0.34 g/t within the overall intercept, and true width is estimated to be 70% of the intercept based on observations of the core. Previous explorers identified gold mineralization as high as 0.52 g/t over an intercept of 135 feet, including 20 feet averaging 1.5 g/t in silicified lower plate carbonates and 0.71 g/t gold over 61 feet in argillized and silicified feldspar porphyry dikes within the Grouse Creek Fault.

The results confirm that the Grouse Creek Fault was a primary focus of a gold mineralization event but, to date, no economically significant gold values have been intersected in drilling. Greencastle plans to continue to define additional drill targets in the Lower Plate rocks along the trace of and within the Grouse Creek Fault, as well as to target potential Lower Plate rocks at depth in the footwall of the fault.

Douglas R. Bowden BSc, MSc, a registered Professional Geologist in the State of Utah, is designated as the Qualified Person supervising Greencastle's technical work. All Greencastle's assays were performed by American Assay or BSI Inspectorate laboratories in Sparks, Nevada, using Fire/AA and Fire/Gravimetric methods.

In Saskatchewan, development continues at the Primate oil project where Greencastle holds a gross overriding royalty. Royalty revenue from seven wells for the quarter ended September 30, 2006 is estimated to be $600,000. Heavy oil prices are seasonal in nature and tend to be highest during the second and third quarters.

This news release includes certain "forward looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of commodities, general market conditions, risks inherent in exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital. The Company relies on litigation protection for forward looking statements.

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No Stock Exchange has reviewed nor accepted responsibility for the adequacy or accuracy of this news release.

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