Kinbauri Gold Corp.

Kinbauri Gold Corp.

May 04, 2007 12:20 ET

Kinbauri Gold Corp.: Drill Results from Kinbauri's Corcoesto Project Indicate Potential Increase in Open-Pittable Resources

OTTAWA, ONTARIO--(CCNMatthews - May 4, 2007) - Kinbauri Gold Corp. ("Kinbauri") (TSX VENTURE:KNB) is pleased to report that it has received the final assay results from its 4,332 metre drill program at Corcoesto project ("Corcoesto") in Galicia, northwestern Spain. Most of the drilling focused on extending the Cova Crea and Peton de Lobo vein systems in the southern part of Corcoesto and on the Picotos vein systems ("Picotos") in the northern part, with a view to expanding the current open-pit resources towards a development decision. Kinbauri had received a NI 43-101 compliant Resource Report in August of 2006 indicating that expanding the current open-pit resources by 25% to 35% (75,000 ounces to 100,000 ounces) with a grade of at least 1.75g Au/t was a reasonable target for assessing a development decision (press release of 08/24/06).

Southern Vein Systems:

Drilling was concentrated on the Cova Crea and Peton de Lobo vein systems; only three holes drilled on the Pozo del Ingles vein system. Cova Crea (CC), Peton de Lobo (PL) and Pozo del Ingles (PI) significant intercepts.

DDH Section From (m) To (m) Intercept(m) Au (g/t)
07K56 CC-3610 86.1 105.1 19.0 1.99
including 94.5 105.1 10.6 2.93
including 94.5 98.0 3.5 7.45
116.5 117.5 1.0 3.23
07K52 CC-3560 33.0 34.0 1.0 1.64
60.3 61.3 1.0 5.78
07K53 CC-3390 55.5 56.5 1.0 5.08
06K39 PL-4450 31.0 37.0 1.0 1.44
95.8 96.8 1.0 2.24
146.0 149.0 3.0 4.44
including 146.0 147.0 1.0 8.54
06K48 PL-4475 175.4 177.4 2.0 0.96
220.0 221.0 1.0 1.70
237.3 243.7 6.4 2.51
including 240.6 242.7 2.1 3.62
including 238.6 239.6 1.0 5.44
247.0 250.4 3.4 1.34
including 247.0 248.0 1.0 3.03
06K44 PL-4500 119.2 120.5 1.3 1.76
144.0 146.0 2.0 1.33
161.8 163.0 1.2 2.22
165.5 166.5 1.0 2.03
06K47 PL-4550 40.0 41.0 1.0 9.08
59.8 62.1 2.3 5.06
64.4 65.4 1.0 1.57
154.0 155.0 1.0 1.41
167.9 169.0 1.1 2.25
07K57 PI-3905 48.0 52.0 4.0 1.29
including 48.0 50.0 2.0 1.63
58.0 55.0 1.0 1.25
07K55 PI-3400 115.9 116.9 1.0 2.17
123.0 124.0 1.0 2.57

All holes reported from CC, PL, PI and Picotos are diamond drill holes at inclinations of 45 degrees with reported intercepts ranging from 80% to 95% true width.

Results at Cova Crea and Peton de Lobo have indicated that open-pittable resources, beyond those previously delineated, are present at the western (CC) and eastern (PL) ends of these vein systems. At Pozo del Ingles (PI), intercepts in 07K57 from an unexplored vein system in the hanging wall indicate continuity of this system, which had been discovered in COR82 (50m to the west of 07K57) where 3.3g Au/t over 5m was intercepted at a down hole depth of 41m.

Northern Vein System:

Three of the northern vein systems at Corcoesto were investigated during the recent drill campaign, namely the Picotos, Fonterremula and Montefurado vein systems.

Picotos significant gold intercepts.

DDH Section From (m) To (m) Intercept(m) Au (g/t)
06K49 3800E 16.0 17.0 1.0 1.81
83.0 85.0 2.0 2.38
06K42 3950E 12.5 14.7 2.2 2.26
64.5 66.6 2.1 1.40
06K43 4000E 5.0 6.0 1.0 3.65
68.0 76.0 8.0 1.66
Including 72.0 75.0 3.0 2.69
06K45 4050E 9.3 10.3 1.0 2.32

The above intercepts combined with previous drill results and trenching (Kinbauri releases of 08/06/06, 10/19/06 and 12/18/06) suggest amenability for open-pitting along strike lengths of at least 100m at Picotos' eastern end and 170m at its western end; Picotos remains open to the west (the complete results for Picotos drilling completed by Kinbauri and Rio Narcea Gold Mines, including intersections of 5.0g Au/t over 5.25m in 06K15; 5.0g Au/t over 4.65m in 06K23; 1.7g Au/t over 11.3m, including 2.7g Au/t over 4.8m, in 06K33; and 2.7g Au/t over 3.5m in 06K37, will be posted on Kinbauri's website).

Two holes were drilled on the Fonterremula vein system: 06K38 assayed 1.17g Au/t over 2m at a down-hole depth of 56.5m, and 1.70g Au/t over 1.2m at a down-hole of 45.3m. Previously, drill hole intercepts of 3.0g Au/t over 8m (COR215) and 3.2g Au/t over 1.6m (COR224) and trench values of 6.3g Au/t over 18m (CAL25), 9.0g Au/t over 3m (CAL55) and 3.8g Au/t over 6m (CAL27) were recorded at Fonterremula.

Two holes were drilled on extensions of the Montefurado vein system, but no significant intersections were encountered. This suggests that this vein system is restricted to a maximum strike length of 75m. Previous drill holes had encountered 2.1g Au/t over 5.8 in 05K12, 5.6g Au/t over 4.8m in COR217 and 1.6g Au/t over 5m in COR224.

The results of this drill program in conjunction with previous drill programs will be reviewed during the next quarter to (i) assess the increase in resources from those reported in the August 2006 43-101 compliant Resource Report (the report did not include any resource estimates for the northern vein systems because of the nature of drill hole locations at that time), (ii) how the results affect pit configuration for open pit development of the Cova Crea and Peton de Lobo vein systems and (iii) determine metallurgical testing required to allow an evaluation of project development economics.

The program at Corcoesto is being supervised by Dr. C.F. Gleeson, Kinbauri's Vice-President of Exploration and a qualified person under NI 43-101. For details of Kinbauri's treatment of samples and quality control program, refer to Kinbauri's press release of March 2nd, 2006.

Rio Narcea Gold Belt: Drilling at El Valle

Full scale exploration drilling at El Valle is scheduled is being phased during the month of May. Initially, the drilling will focus on Area 107 where inferred resources of 913,000t at 11g Au/t for 342,000 ounces of gold have been previously delineated. The objective is to define 2Mt of relatively high grade resources on Area 107 as part of a larger resource objective of 3Mt with an average grade of 8g Au/t. Definition drilling will follow to delineate adequate resources to rejuvenate mine and mill operation at El Valle. For more details of Kinbauri's properties and assets in the Rio Narcea Gold Belt, which are being held in trust by Kinbauri Espana, S.L. pending final approval by the TSX-V of their acquisition, and proposed work programs and objectives, refer to Kinbauri's press releases of 04/25/07 and 2007 third quarter financials and MD&A filed on Sedar ( and Kinbauri's website (

For gross proceeds of $181,583, a total of 324,255 subscription receipts priced at $0.56 per subscription receipt have been issued to satisfy terms of a bridge loan to Kinbauri Espana, S.L. Agents to the financing will be paid a commission of $12,710 and will receive 22,698 broker's warrants. All securities subject to 4 month hold. For full details of the bridge loan, the financing and terms see press releases of 2/04/07, 18/04/07 and 25/04/07.

This press release was prepared by Dr. V.N. Rampton in his capacity as a qualified person.

Kinbauri is a mineral exploration company focused on advanced stage/development properties in northwestern Spain.

This press release contains certain forward-looking statements, which 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. Kinbauri 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.


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