Maxy Gold Corp.

Maxy Gold Corp.

March 07, 2005 09:00 ET

Maxy Gold Corp.: Exploration Update on Luchun Project, Yunnan Province, China


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: MAXY GOLD CORP.

TSX VENTURE SYMBOL: MXD

MARCH 7, 2005 - 09:00 ET

Maxy Gold Corp.: Exploration Update on Luchun Project,
Yunnan Province, China

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 7, 2005) - Maxy Gold
Corp. (TSX VENTURE:MXD): Andre Gauthier, president of Maxy, is pleased
to provide an update on ongoing work programs on the Luchun Gold
Project, in southern Yunnan Province, China:

- The initial exploration drill program on the Niukong property has been
completed, with a total of 8 holes drilled by Maxy's own rig to depths
between 200 and 300 meters (m). 5 holes have been reported to date and
three holes ( NK-06-07-08) are included in this press release.

- An independent geologist was commissioned in January to review the
mapping on the Niukong and Niubo-Dichu properties of the Luchun Project
in order to better assess the mineralized structure encountered. His
completed report is very encouraging, and provides very valuable
insights into the extension and interpretation of the main
mineralization zone of the Niukong target and will be used in planning
the next drilling phase.

- Based on encouraging results from the initial drill program, an
expanded drill program is being planned to commence shortly, with holes
sited in reliance on the new structural interpretation of the Niukong
mineralized zones.

- Significant work has been completed on the Niubo Dichu project in
aditing, trenching and access road preparation. Details will be provided
in a subsequent release

Drill Program

The Niukong drill program was designed to intersect gold mineralization
exposed at surface in trenches and through artisanal workings. The
results of the overall program are very encouraging. As reported
November 9, 2005, hole DDH-NK01 intersected a mineralized zone at a
depth between 106.5 metres (m) and 132.0 m, returning a 25.95 m interval
that assayed 1.65 grams per tonne (g/t) gold (Au), including 2m of 16.29
g/t Au. Hole DDH-05 intersected a broad zone of mineralization with
significant intercepts in three sections, separated by gold anomalous
gaps with the most significant assays for the core zones returning:
12.50 g/t Au over 8.40m, which includes an interval of 48.86 g/t Au over
1.55m; and 4.00 g/t Au over 15.50m, including 31.46 g/t Au over 1.66m.
Drill holes DDH-NK06, 07 and 08 were designed to intercept the eastern
extension of gold mineralization at depth and were planned according to
the prior structural interpretation. DDH-NK06 and DDH-NK07 are located
approximately 450m and 600m east respectively, of DDH-01. See the
Niukong area map on www.maxygoldcorp.com for precise drill locations.



Full assays of the relevant intersections are set out in the table
below.

SUMMARY OF INTERCEPTS
Niukong Property, Luchun Project Area, Yunnan Province, PRC.

------------------------------------------------------
DRILLHOLE FROM TO WIDTH AVG. GRADE
NO metres metres metres g/t Au
------------------------------------------------------
DDH-NK 06 10.15 13.70 3.55 0.4
------------------------------------------------------
159.75 161.70 1.95 1.7
------------------------------------------------------
233.58 238.33 4.75 1.2
------------------------------------------------------

------------------------------------------------------
DDH-NK 07 59.67 61.35 1.85 1.7
------------------------------------------------------
87.61 89.8 2.19 0.6
------------------------------------------------------
119.5 120.5 2.0 0.7
------------------------------------------------------
129.66 138.33 8.67 1.9
------------------------------------------------------
Including 136.38 138.33 1.95 2.9
------------------------------------------------------
208.1 217.5 9.4 0.4
------------------------------------------------------
234.0 237.85 3.85 0.9
------------------------------------------------------
253.85 256.90 3.05 0.6
------------------------------------------------------

------------------------------------------------------
DDH-NK 08 9.25 12.35 3.10 0.6
------------------------------------------------------


Geological Review

In order to properly assess work to date on the Niukong Project and to
better understand the structure in preparation for an expanded
exploration program, Maxy retained a very experienced field geologist in
January to review the Niukong and Niubo Dichu properties of the Luchun
project. He reported that:

There are three main mineralized zones exposed to date on the NIUKONG
target and a fourth zone of unknown extent has been cut by hole NK-07.
Zones 2, 3 and 4 are the main targets at this point. They are known to
host high grade intercepts and can be traced for significant strike
across the project. Alteration is strongest around these structures.
There is a strong probability that these zones can be extended in both
directions along strike, especially to the southeast where alteration is
strongest. Historical soil data and alteration mapping also suggests the
presence of a fourth structure parallel to and between zones 2 and 3,
but the location of this anomaly may be unreliable.

Significant gold mineralization has been encountered to date from all
four zones. Surface trenches on Zone 1 yielded up to 6.7m @ 24 g/t Au
and 12.0m @ 1.0 g/t Au. Drill holes NK-01 and NK-02 tested this zone.
Results from NK-02 are anomalous and NK-01 cut 26m @1.6 g/t Au.

Zone 2 has some good grades on surface in two areas (3.0m @ 28.3 g/t Au;
13.5m @ 1.8 g/t Au) and drilling beneath the latter cut good grades
(NK-05: 8.4m @ 12.5 g/t Au and 15.5m @ 4.0 g/t Au). Hole NK-08 targeted
the other good surface results from zone 2 but was drilled down dip from
the footwall side and probably remained in the footwall of the zone
along its entire length.

Zone 3 also has some good grades on surface in informal workings (4.9m
@7.1 g/t Au). This zone has been tested by one drill hole NK-06. The
hole cut 1.1 g/t Au over 5.8m within 63m @ 0.26 g/t Au. This hole was
also collared on the footwall side of the structure and drilled downdip.

Zone 4 is based solely on a trench that reports up to 3 g/t Au and drill
hole NK-07 that cut 14.7m @ 1.2 g/t Au. Adit NK-04 should end in or cut
zone 2 at 170 m. Adit Nk-06a was collared in the hanging wall of zone 3
and could intercept zone 4 at 160-180 m. Adit Nk-06b runs along zone 3
with a single crosscut into the zone. Assays from this last adit are
pending. Results will be expected very shortly.

Structure

Brittle faults are the dominant structural feature of the area,
accounting for 20-80% of some drill holes. Broad zones of broken and
rubbly rocks host wide zones of strong clay gouge. Mineralization is
closely associated with some of the gouge zones. Two orientations appear
to dominate. Zone 1 consists of an east-west striking zone that dips
steeply to moderately to the south. Zones 2 and 3 strike 120 degrees and
are sub-vertical to steeply north east dipping. A fourth zone is cut by
drill hole NK-07 and probably trends NW through a trench reported to
have up to 3 g/t Au.

Mineralization

The mineralized zones are all deeply weathered and consist of broken
limonitic to manganese (Mn) stained rocks adjacent to and including wide
zones of clay gouge. Only very minor quartz is present as deformed and
broken veins associated with fault structures. Strong limonite and Mn
are the main keys to ore grades. The mineralized zones consist of narrow
higher grade intervals (10-50 g/t Au) surrounded by a broad halo of
100-1000 ppb Au in broken and altered sandstone. While mudstone and
conglomerate both host alteration and mineralization, most of the wider
disseminated zones are hosted by sandstone below the mudstone rich
sequence or in sandy layers in the underlying conglomerate rich section.

Planned Work

Maxy Gold has commenced a second phase of exploration on the NIUKONG
property based on its new geological interpretation and the
recommendations of the independent geologist. The second phase will
include the following works in 2005:

1. A new sampling on a grid of lines spaced 200m apart will be completed
and eight lines 600 to 800 long will cover the core target area and
provide good definition for further drilling. There is no mapping or
trenching located along strike in either direction from newly defined
zones 2 and 4. The recommended mapping and rock sampling in these areas
will be completed.

2. A second drill program will start shortly, drilling on zones 2 to 4
at an orientation of 210 degrees as the zones strike to the SE (120
degrees) and when not sub-vertical, dip 60-70 degrees to the NE.

3. The program of wide spaced soil lines planned to cover the remainder
of the Niukong property will be replaced by a series of ridge and spur
soil lines in order to better determine the extension of the Niukong
mineralized system which remains open in both directions along strike.

In summary the new analysis of work to date on the structure has
confirmed that the Niukong mineralized zone is oriented to the
northwest/southeast, varying from the east/west orientation originally
postulated. The extent of the system remains totally unknown, being open
along strike in both directions. A gold-in-soil anomaly 250m wide with
values from 40 to 140 ppb Au is present 1300 m northeast of zone 1. This
effectively increases the strike of the known system from 1000m to
2300m. Soil anomalies are also present 350m northwest of Zone 1. This
area has yet to be tested by drilling or significant trenching. The area
is now at least in part covered by overburden dumped from the small open
pit operation being carried out in a contained area of the Niukong
property (artisanal production).

Additional work underway on the Niukong includes three short adits to
intercept the mineralized structures and trace distribution of gold
mineralization, and a soil geochemical survey in the area on a 200 m by
20 m spacing.

Maxy has now earned a majority interest in the Luchun project, on the
way to earning a full 80%. As a result, Andre Gauthier has been
appointed Chairman of the Luchun joint venture company, Yunnan Si Mai
Mining Co. Ltd.

Andre Gauthier, Maxy's president, is the Qualified Person on the project
and oversaw preparation of the information in this Press Release.

Quality Control

The exploration program is being supervised by Dr. Xianda Wang (PhD.
University of Salzburg, Austria), V.P. China Operations for Maxy. The
core samples were split and one-half delivered to the Preparation
Laboratory in Kunming, and pulverized to minus 200 mesh for analyzing in
the Langfang Institute of Geochemical and Geophysical Exploration
(Certification ISO 9001), a well regarded analytical laboratory in
Langfang, Hebei Province - approximately 60 km from Beijing in the
People's Republic of China.

To ensure best practice in lithogeochemical sampling and analysis for
gold, Maxy has implemented a quality control program, and has inspected
the laboratory facility and found its procedures to meet with industry
standards. Samples were analyzed by dissolution in an aqua regia acid
digestion followed by atomic absorption for the analysis of gold,
silver, copper, nickel, arsenic, antimony and bismuth. At present only
results for gold have been received.

Significant intercepts were assayed at both the Langfang labs and at ALS
Chemex in Vancouver BC. Assay results from the two labs have been
compared statistically, and the Langfang laboratory is judged to be
accurate and reliable. Selective samples (about twenty percent) will
also be shipped directly to ALS Chemex in Vancouver for preparation and
analysis on a going forward basis. ALS Chemex is an ISO 9002 registered
laboratory and is preparing for ISO 17025 Certification.

Maxy Gold Corp. holds the rights to acquire an 80% interest in the
Luchun Gold Project, and a 75% interest in the Midu Gold Project, both
located in Yunnan Province, China.

Statements in this press release other than purely historical
information, including statements relating to the Company's future plans
and objectives or expected results, constitute forward-looking
statements. Forward-looking statements are based on numerous assumptions
and are subject to all of the risks and uncertainties inherent in the
Company's business, including risks inherent in resource exploration and
development. As a result, actual results may vary materially from those
described in the forward-looking statements.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Maxy Gold Corp.
    Andre Gauthier
    President
    (604) 688-8811
    info@maxygoldcorp.com
    www.maxygoldcorp.com
    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release.