Northland Resources Inc.

Northland Resources Inc.

July 19, 2005 12:11 ET

North American Gold Inc.: Drilling Underway at Stora Sahavaara & Norra-Barsele Changes Name to Northland Resources Inc.

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - July 19, 2005) - Mr. Buck Morrow, the President of North American Gold Inc. (TSX VENTURE:NAU), is pleased to announce that drilling is underway at the Stora Sahavaara magnetite deposit, and at the Barsele gold project, both located in Sweden.

Stora Sahavaara Iron Project

Large diameter core drilling has started at the Stora Sahavaara magnetite deposit in Sweden, where work by the Swedish Geological Survey (SGU) identified a 100 million tonne magnetite (43.7% Fe) resource (The resource estimates quoted in this news release were prepared prior to the implementation of National Instrument 43-101. Please refer to the Disclaimer below.)

The program will consist of drilling approximately 400m of large diameter (80mm size) core in 4 holes to provide sufficient material for preliminary metallurgical testing and mineralogical studies of the magnetite ore. The holes are collared within the limits of the existing resource. The metallurgical test work and up coming in-fill drilling at Stora Sahavaara are required to prepare a NI43-101 resource calculation and to then advance the deposit to a bankable feasibility stage.

Three of the four holes are complete and all intersected the magnetite body where expected, over widths consistent with the geological model for the Stora Sahavaara magnetite body. Visual examination of the core indicates the presence of chalcopyrite and alteration consistent with an IOGC type system.

A second phase of drilling is scheduled to begin the second week of August and will consist of a minimum of 2,000m of core drilling designed to initiate evaluation of the iron-oxide-copper-gold (IOCG) potential associated with the Stora Sahavaara magnetite deposit.

A further 7 magnetite deposits within the Kaunisvaara Iron Ore Field, identified by the Swedish Geological Survey and located on North American Gold's Pajala properties will be evaluated over the coming months.


In Finland, NAU's geologists are re-logging the 40km of archived core stored at the core library of the Geological Survey of Finland (GTK) which was drilled within the Hannukainen iron ore deposit. To date, 7km have been re-logged and 2.5km have been split in preparation for assay. The information will be used for assay QA/QC, and to further evaluate the gold and copper potential contained within the magnetite iron ore. The data will be incorporated into "MineSite" digital 3D modeling of the resource.

NAU is also in the process of translating the past production records from the Hannukainen mine in order to confirm the GTK's historic production estimate of 4.5 million tons at a grade of 43% Fe, 0.88% Cu, and 1 g/t Au. Significantly, the deposits at Hannukainen are reported by the GTK to contain iron resources of 66 million tonnes of magnetite, although this resource estimate was prepared prior to the implementation of National Instrument 43-101. The current re-logging program has identified substantial intervals containing visible chalcopyrite mineralization within and adjacent to the magnetite body.

Norra-Barsele Gold Project

The most recent round of drilling is now complete at the Norra gold project. Eight holes were completed, for a total of 862m of drilling. Assay results from this program are expected within the next two weeks.

Drilling is now underway at Barsele. Three RC holes of a planned 2,700m program have been completed. The RC program at Barsele is designed to expand the existing gold resource within the projected higher grade areas of the Central and Skirasen Zones. A comprehensive QA/QC program is also underway to examine how the use of different core and sample sizes, and assay techniques, influences the gold grade of the resource.

NI43-101 Disclaimer

The resource estimates quoted in this news release were prepared prior to the implementation of National Instrument 43-101. North American Gold is relying on estimates prepared by the SGU and published in 1967 in a report titled "The Stora Sahavaara Iron Ore Deposit, Kaunisvaara, Northern Sweden" written by Bo Lundberg as well as a report titled "Review of iron-oxide-copper-gold mineralization in northern Fennoscandia (Sweden and Finland)" prepared by the Geological Survey of Finland for NAU, dated February, 2005.

None of the historical resource estimates in the SGU use the resource categories stipulated in Section 1.3 of National Instrument 43-101, which are "inferred mineral resource", "indicated mineral resource" and "measured mineral resource." Rather, the historical resource estimate for the Stora Sahavaara deposit reported by the SGU refers to "100 million tonnes", which is not a category stipulated in National Instrument 43-101. The Company does not have, and is not aware of, any more recent resource estimates which conform to the standards laid out in National Instrument 43-101.

The Company advises that it has not done the work necessary to verify the classification of either of the mineral resource estimates and such estimates have not been verified by a qualified person. The Company is not treating the historical resource estimate as a National Instrument 43-101-defined resource or reserve, and the historical resource estimate should not be relied upon. Work is currently underway to bring these estimates up to NI43-101 standard.

Vance V. Thornsberry, P.Geo., Vice-President of Exploration for North American Gold, is the qualified person as defined in National Instrument 43-101 and has verified that the information presented in this release has been accurately summarized from the reports quoted herein.

Corporate Activities

At the annual general meeting of the Company held on July 12, 2005, the shareholders approved a change of name of the Company to "Northland Resources Inc.". The name change will be effective shortly, once stock exchange approval has been obtained. The Company will retain the stock symbol NAU.


North American Gold Inc. is a well-structured, debt free junior exploration company with a portfolio of high quality gold, iron and base metal exploration projects in Sweden and Finland. The Company has an option to acquire a 60% interest in the Norra and Barsele properties in Sweden from MinMet plc (see News Release dated November 3, 2003), and has entered into an option agreement with Anglo American, plc to acquire a 100% interest in two exploration permits in Sweden (see News Release dated December 8, 2004). The Company also recently acquired a 100% interest in a number of exploration reservations in Finland, covering within the mineral-rich Pajala shear zone in the western part of Finnish Lapland, near the Swedish border.


Buck Morrow, President


The TSX Venture Exchange has not reviewed and does not take responsibility for the accuracy of this release.

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