Canasil Resources Inc.
TSX VENTURE : CLZ
FRANKFURT : 3CC

Canasil Resources Inc.

October 04, 2012 09:00 ET

MAG Silver Mobilizes to Start Phase 2 Drill Program on Canasil's La Esperanza Project in Durango and Zacatecas States, Mexico

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 4, 2012) - Canasil Resources Inc. (TSX VENTURE:CLZ)(FRANKFURT:3CC) ("Canasil") announces that MAG Silver Corp. (TSX:MAG)(NYSE MKT:MVG) ("MAG") has mobilized crews to prepare for the start of the Phase 2 drill program in early October 2012 at Canasil's La Esperanza silver-zinc-lead project in Durango and Zacatecas States, Mexico. Plans include up to 3,500 metres of diamond drilling to test three silver-lead-zinc veins in the northwest of the project area. This drill program will be part of the CAD$1,500,000 exploration expenditures required between September 2012 and September 2013 under the option agreement for MAG to earn a 60% interest in the La Esperanza project.

Surface sampling by MAG at these veins has returned consistent silver values. Samples returning higher than 100 g/t silver are listed in the table below, with a significant number of samples returning over 300 g/t silver:

La Esperanza Surface Samples - Northwestern Veins
Sample East North Width M Ag g/t Pb % Zn %
128933 591215 2587322 1.50 110 2.15 0.24
128934 591214 2587322 Dump 177 3.24 0.30
128942 591235 2587298 1.20 191 3.38 0.03
128960 592291 2587278 0.80 110 4.03 0.81
147693 591552 2587039 0.80 157 2.07 0.04
147701 593212 2590193 0.60 1,135 1.35 0.03
147714 593007 2590403 0.30 566 2.93 0.36
147715 593008 2590403 0.40 422 0.43 0.07
147723 592984 2590430 0.50 165 0.14 0.16
147724 592985 2590431 1.00 140 0.24 0.21
147726 592987 2590443 1.00 748 1.55 0.10
147727 592988 2590434 1.00 141 0.85 0.10
147730 592980 2590506 0.60 427 0.15 0.55
147731 592981 2590506 0.60 504 0.22 0.64
147732 592982 2590506 0.60 446 0.37 1.13
147733 592983 2590506 0.60 788 0.51 1.06
147741 592984 2590544 1.00 561 0.23 0.23
147742 592985 2590544 1.00 122 0.26 0.11
147755 592071 2590354 0.60 121 0.51 0.19
147809 592220 2587195 0.80 606 0.28 0.20
147810 592221 2587194 0.70 372 0.34 0.11
147811 592222 2587193 0.50 120 0.75 0.20
147895 590700 2586771 Dump 143 1.16 0.19

Quality Assurance and Control: MAG Silver has in place a quality control program to ensure best practices in sampling and analysis. Samples were collected by employees of consulting firm Minera Cascabel S.A. de C.V. on behalf of MAG Silver Corp. One blank and standard sample are each inserted into each batch of 20 total samples. The samples are then shipped directly in security sealed bags to ALS-Chemex Laboratories preparation facilities in Zacatecas City (Certification ISO 9001). Sample pulps are shipped from there to ALS-Chemex Laboratories in North Vancouver, Canada for analysis. Silver, zinc, copper and lead values are determined by Atomic Absorption Spectrometry and where in excess of 100 ppm, 1%, 1% and 1% respectively are also repeated by fire assay. Gold assays were by standard fire assay-ICP finish and those in excess of 3.00 g/t are re-analyzed by fire assay with gravimetric finish.

About La Esperanza:

The La Esperanza project covers 68,954 hectares, located in the Mexican Silver Belt in northern Zacatecas and southern Durango States. This recognized world class silver belt hosts a number of active mines such as Pan American Silver's La Colorada and First Majestic Silver's La Parrilla mines. The project covers multiple vein occurrences and alteration zones over a 20 kilometre strike length along a prospective SE-NW trend where the results of an airborne geophysical survey conducted by MAG indicate potential for hosting a very large mineralized system.

Drilling conducted by Canasil and MAG on the La Esperanza vein has confirmed a high-grade silver-zinc-lead mineralized panel along a strike distance of over 250 metres and to a depth of 300 metres, which is open in all directions, with mineralized vein intercepts of up to 10.30 metres. Recent drilling by MAG intersected a 10.15 metre intercept carrying 98 g/t (2.86 opt) silver, 2.42% zinc and 1.16% lead, including 2.42 metres with 278 g/t (8.10 opt) silver, 5.82% zinc and 2.84% lead. The La Esperanza vein includes several intercepts with very high silver grades of up to 2,144 g/t (62.53 opt) silver over 0.75 metres.

The project is under an option agreement whereby MAG can earn a 60% interest by completing CAD$5,000,000 in cumulative exploration expenditures by September 1, 2014, (CAD$1,624,393 completed to June 30, 2012) and making a further CAD$200,000 cash payment to Canasil by September 1, 2013.

About MAG Silver and Canasil:

MAG is a leading silver exploration and emerging development company in Mexico with considerable experience and a very successful track record of high-grade silver discoveries in epithermal vein systems of the Fresnillo Silver Trend, as well as a number of other large development stage and exploration projects in Mexico.

Canasil is a Canadian mineral exploration company with interests in precious and base metal projects in Durango, Sinaloa and Zacatecas States, Mexico, and in British Columbia, Canada. The Company's directors and management include industry professionals with a track record of identifying and advancing successful mineral exploration projects. The Company is actively engaged in the exploration of its mineral properties.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

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