NEW ISLAND RESOURCES INC.
TSX VENTURE : NIS

NEW ISLAND RESOURCES INC.

September 24, 2010 08:30 ET

Mountain Lake Acquires 100% of Glover Island Gold Property in Western Newfoundland From New Island

Glover Island is Host to Several Significant Gold Prospects Over an 11 km Strike Length and is Located Approximately 70 km From Mountain Lake's Valentine Lake Gold Project

HALIFAX, NOVA SCOTIA--(Marketwire - Sept. 24, 2010) - Mountain Lake Resources Inc. (TSX VENTURE:MOA) ("Mountain Lake") and New Island Resources Inc. (TSX VENTURE:NIS) ("New Island") are pleased to announce that they have reached an agreement through which Mountain Lake will acquire from New Island an undivided 100% interest in the Glover Island Property, located in western Newfoundland. The Glover Island Property consists of two mineral licenses and one mining lease, covering a total of 5,100 hectares.

In consideration of the acquisition, Mountain Lake will pay to New Island $500,000, and issue 1 million common shares. In addition, Mountain Lake will issue share purchase warrants to New Island for the acquisition of up to another 500,000 common shares at an exercise price of $1.20 per share for a period of two years. Mountain Lake will also waive payment of any break fee from New Island in connection with the termination of the Arrangement with New Island (notice of Mountain Lake's claimed break fee was published in its press release of September 1, 2010 and was disputed by New Island), and forfeit repayment of a loan to New Island of $160,000 plus the accrued interest (estimated at $3,420). Mountain Lake will also pay New Island a net smelter returns royalty of 1% of commercial production, which reduces to 0.5% after the payment of the first $1 million.

The closing of the proposed transaction is subject to all required regulatory approvals being obtained.

About the Glover Island Property

The Glover Island Property is a gold exploration property that is situated roughly 70 kilometres (km) from Mountain Lake's Valentine Lake Gold Project, and is host to several significant gold prospects over an 11 km strike length. Significant drill intercepts at Glover Island include 16.7 metres (m) of 5.31 grams per tonne (g/t) gold (Au) at the LPSE prospect, 10 m of 4.93 g/t Au at Kettle Pond South, and 8.0 m of 10.18 g/t Au at the Lucky Smoke deposit. Non-NI 43-101 compliant resources have been calculated at the LPSE and Kettle Pond South prospects, and Mountain Lake believes that these could be upgraded to NI 43-101 disclosure standards, once data verification and quality control measures are completed.

Dave Barber, P.Geo., an independent geological consultant and Qualified Person in compliance with National Instrument 43-101 who was involved with the Valentine Lake Gold Project going back to the discovery phase, recently commented, "In addition to working on the Glover Island Property the gold mineralization formed the basis of my Master of Science studies and in my opinion it's the most overlooked project on the island of Newfoundland and second only to the Valentine Lake Property for its gold exploration potential."

About Mountain Lake Resources Inc.

Mountain Lake Resources Inc. (TSX VENTURE:MOA) is a diversified junior exploration company, whose corporate strategy is to build shareholder value through the exploration and development of economically viable mineral properties. Mountain Lake's current projects include: a 30% interest in the Valentine Lake gold property (Newfoundland) with an option to acquire the remaining 70% interest from Richmont Mines Inc. and a subsequent sub-option and joint venture agreement whereby Marathon PGM Corp. can earn a 50% interest in the property; a 100% interest in the Glover Island gold exploration property (Newfoundland); an option to earn a 100% interest in the Little River gold-antimony exploration property (Newfoundland); a 100% interest in the Bobby's Pond base metals property (Newfoundland); and a 2,350,000 share (~6.4%) stake in Etruscan Diamonds Ltd., an alluvial diamond project (South Africa). For more information visit: www.mountain-lake.com.

About New Island Resources Inc.

New Island is a diversified junior exploration company holding gold and base metal properties in the Province of Newfoundland and Labrador. New Island has entered into agreements for the sale of its interest in the gold mine and mill project at Pine Cove in central Newfoundland and for the sale of the Glover Island exploration property in western Newfoundland. Additional information concerning these sales and New Island may be obtained on New Island's website at: www.newislandresources.com or from the System for Electronic Document Analysis and Retrieval (SEDAR) website at: www.sedar.com under New Island's profile.

ON BEHALF OF THE BOARD OF DIRECTORS OF MOUNTAIN LAKE RESOURCES INC.

Gary Woods, President & CEO

ON BEHALF OF THE BOARD OF DIRECTORS OF NEW ISLAND RESOURCES INC.

Harold Wareham, President & CEO

NEITHER THE TSX VENTURE EXCHANGE, NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED UNDER THE POLICIES OF THE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE.

Contact Information

  • For corporate, media, or investor inquiries on Mountain Lake
    please contact: Mountain Lake Resources inc.
    Greg Lytle, Communications Manager
    N. America toll-free: (866) 285-5817
    Int'l. & Vancouver: (604) 839-6946
    Email: info@mountain-lake.com
    or
    For corporate, media, or investor inquiries on New Island,
    please contact: New Island Resources Inc.
    Harold Wareham, President
    (709) 576-7711
    info@newislandressources.com