Mengold Resources Inc.
TSX VENTURE : MNI

Mengold Resources Inc.

October 30, 2006 07:45 ET

Mengold Intersects 7.07 gpt Gold Over 1.05 Metres at New Mineralized Zone on the Burchell Lake Property Diamond Drilling Program Planned

MONTREAL, QUEBEC--(CCNMatthews - Oct. 30, 2006) - Mengold Resources Inc. (TSX VENTURE:MNI) has discovered a new area with multiple zones of gold mineralization at its Burchell Lake Property. Drill Hole BU06-03 intersected 4 zones of gold mineralization in an area that was formerly untested in the west-southwestern part of the claim group. The 1,700-hectare Burchell Lake Property is located in the Shebandowan area, 110-km west of Thunder Bay, Ontario.

As previously reported in News Release 06-13 on August 30th 2006, drill hole BU06-03, which was testing a VTEM anomaly on the Burchell Lake Property, intersected a number of mineralized zones. Management is very pleased to report assay results establishing that several zones of gold mineralization were intersected and that some gold grades of economic significance were discovered. The zones described below are open at depth and along strike and will be tested in the upcoming diamond drilling program.

Drill Hole BU06-3 located in the west-southwest part of the claim group drill tested a strong VTEM anomaly which has never been previously investigated. A 40.85m wide (drill core length) mineralized zone from 37.70m to 78.55m called the South Zone contains sections with up to 60% pyrite (average: 5% to 6% pyrite) within a series of basalts, cherty tuffs, breccia and quartz veins. After intersecting two other zones of gold mineralization, a 1.05m intercept, near the bottom of the hole, yielded 7.07 gpt gold over 1.05m. All the gold mineralization encountered in this drill hole represents new discovery zones over a 600m long VTEM anomaly which has never previously been tested. The most significant drill intercepts from the upper South Zone are tabulated below as follows:



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Hole No. UTM Dip From To Interval Gold
Coordinates (m) (m) (m) (gpt)
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BU-06-03 5379291.34 N -45 degrees 50.70 53.15 2.45 1.12
674122.03 E
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Including 50.70 51.70 1.00 1.00
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Including 51.70 52.30 0.60 1.54
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Including 52.30 53.15 0.85 0.16
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64.15 70.65 6.50 0.31
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Including 68.65 70.65 2.00 0.658
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76.40 78.55 2.15 0.32
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Another section further on down the down from 103.00m to 110.70m yielded 0.18 gpt gold over 7.70m. This section contains from 0.5% - 1% pyrite and pyrrhotite. In another section from 119.55m to 123.20m, pyrite content averages about 1% with up to 5% locally. The following results were obtained:



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Hole No. UTM Dip From To Interval Gold
Coordinates (m) (m) (m) (gpt)
---------------------------------------------------------------------------
BU-06-03 5379291.34 N -45 degrees 119.55 123.20 3.65 1.51
674122.03 E
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Including 119.55 120.55 1.00 0.07
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Including 120.55 121.30 0.75 0.37
---------------------------------------------------------------------------
Including 121.30 122.20 0.90 1.16
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Including 122.20 123.20 1.00 4.13
---------------------------------------------------------------------------


Near the bottom of the hole, a quartz vein containing 10% pyrrhotite, subordinate chalcopyrite, and 3% pyrite returned 7.07 gpt gold over 1.05m from 142.55 to 143.60m. This section contains about 30% silica on average and is near the bottom of the hole. Narrow veinlets healed with pyrite and pyrrhotite continue to the end of the hole at 158.00m.

Although the drill core from Hole BU06-05 carried a substantial amount of pyrite, the assay results were not of interest. Considering that only five holes were drilled in an initial program, totalling 669m including one hole abandoned, Mengold is very pleased with the results and is keen to drill test along strike of hole BU06-03 and several other targets. A crew is currently in the field conducting additional prospecting and verifying airborne conductors in preparation for the winter drilling program. Over thirteen conductive zones indicative of massive sulphide targets were identified in the VTEM survey conducted earlier this year.

Three separate grids have just been completed on the Goldcreek Property for a total of 82 line kilometers and a 26 kilometer grid has been cut at the Burchell Lake Property. Tendering is underway to conduct ground geophysical surveys including Magnetometric/Electromagnetic, MaxMin, and IP (Induced Polarization). These ground surveys are used to detect disseminated and massive sulphides. Following the completion of the surveys, Mengold is planning a 3,000m diamond drilling campaign at the Burchell Lake and Goldcreek Properties which is anticipated to commence after freeze-up.

The Qualified Person supervising the work being carried out on the Burchell Lake and Goldcreek Properties is Joel Scodnick,P.Geo., President & CEO of Mengold Resources Inc.

The company has a Quality Assurance - Quality Control program in place. Detailed drill logs, digital photographs of the drill core, and the insertion of standards and blanks in assay samples are all part of the QA - QC program. Selected samples are sent for analysis to Accurassay Laboratories in Thunder Bay, Ontario. Accurassay is an accredited laboratory. The core samples are sawn in half with one half being sent to the lab and the other half kept in safekeeping. All of the drill core assayed for gold uses a 50g fire assay charge from a 500g split. With each batch of samples submitted to the lab, every tenth sample is checked for quality control. Mengold is also including a certified standard with each twenty-five samples.

Mengold Resources Inc. is engaged in mineral exploration for precious and base metals. The Company is currently conducting exploration programs at the Burchell Lake and Goldcreek Properties, both prospective for gold, copper, and zinc, in the Shebandowan area of Ontario. Mengold also holds two properties in Quebec, the Mountain River Property near Sainte-Anne-du-Lac, and the Thetford Property in the Eastern Townships. Mengold has 18,483,536 common shares outstanding (23,568,986 shares fully diluted).

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information

  • In Canada
    Mengold Resources Inc.
    Joel Scodnick, President and Chief Executive Officer
    (705) 522-4439 or (807) 629-7516
    (705) 522-8694 (FAX)
    Email: scodnick@netspectrum.ca
    or
    Mengold Resources Inc.
    Douglas G. Reeson
    C.F.O. and Director
    (416) 533-0323
    (416) 533-2890 (FAX)
    or
    In Europe
    Mengold Resources Inc.
    W. Ian L. Forrest, Chairman and Director
    011.41.22.809.9511
    011.41.22.899.9501 (FAX)
    Website: www.mengold.com