Queenstake Resources Ltd.
TSX : QRL
AMEX : QEE

Queenstake Resources Ltd.

November 08, 2005 18:58 ET

Queenstake Drills High Grade Mineralization; Potential to Extend Mine Life at Smith Mine

DENVER, COLORADO--(CCNMatthews - Nov. 8, 2005) - Queenstake Resources Ltd. (TSX:QRL)(AMEX:QEE) reported that its surface drilling program has encountered high grade gold intercepts, extending the known mineralization outside the current resource(1) boundary of the Smith Mine. The results(2) will be incorporated in a new mine model that will be used in the estimation of reserves and resources(1) at year-end 2005 and could extend the projected life of mine at Smith.

Commenting on the exploration results, President and Chief Executive Officer Dorian L. (Dusty) Nicol said, "These excellent results from the Mahala and West Dash deposits suggest likely gold resource additions at the Smith Mine and associated high-grade Mahala deposit that could extend the mine life at Smith. Pending incorporation of these results into a new mine model, we believe these results could expand the resource and improve the grade at West Dash and could expand near-term mineable reserves at Mahala. Our geologists have done an excellent job in interpreting the controlling structures for drill targets and continuing to discover high-grade mineralization around our mines."

At the Mahala deposit, which commenced commercial production in mid-August 2005 following commissioning of the ventilation and escape-way raise, three reverse circulation(3) holes were completed in September 2005, totaling 2,735 feet. Positive results included an intercept of 20 feet with an average grade of 0.972 ounce of gold per ton (opt). This drill hole is approximately 800 feet northwest of the current drift in Zone 4 at Smith. Follow up drilling is planned this year that could add reserves to be mined in 2007. Mahala had measured and indicated resources, including reserves of 486,000 tons at 0.305 opt, containing 148,000 ounces of gold, at year-end 2004. The following table shows drill intercepts of 10 feet or more at a grade of 0.20 opt or higher.



Table 1: Mahala Results Highlights (4, 5)
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From To Length Grade
Hole # Dip (feet) (feet) (feet) (opt)
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MAH-280 -90 665 675 10 0.265
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MAH-282 -90 635 675 40 0.241
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with -90 655 675 20 0.333
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and -90 730 750 20 0.972
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In October 2005, six reverse circulation(3) holes were completed from surface, totaling 4,140 feet, to expand the West Dash resource, which is approximately 800 feet west of the main drift for the Smith Mine. Positive results from four of the holes indicate expected additions at year-end 2005 to the 2004 indicated resources of 83,000 tons grading 0.269 opt, containing 22,300 ounces of gold, and inferred resources of 109,600 tons grading 0.244 opt, containing 11,700 ounces of gold. Results included one hole with intercepts of 30 feet of 0.544 opt and 15 feet of 0.456 opt, which could improve the average grade of mineralization. The following table shows intercepts of 10 feet or more at a grade of 0.20 opt or higher.



Table 2: West Dash Results Highlights (4, 5)
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From To Length Grade
Hole # Dip (feet) (feet) (feet) (opt)
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SH-1058A -80 440 455 15 0.229
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SH-1059 -90 545 575 30 0.544
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585 600 15 0.456
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SH-1091 -90 545 560 15 0.258
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(See Appendix Maps 1 and 2 for the location of the drill holes. These maps are available under the Investor Information/News Releases section at www.queenstake.com). A near-mine surface and underground drilling program continues, targeting resource conversion and discovery of new resources and reserves. The Company currently has two surface drill rigs conducting near-mine exploration at Mahala and West Dash and another three surface rigs being utilized for district exploration at Starvation Canyon.

Queenstake Resources Ltd. is a gold mining and exploration company based in Denver, Colorado. Its principal asset is the wholly owned Jerritt Canyon district in Nevada. Jerritt Canyon has produced over seven million ounces of gold since 1981. Current production at the property is from underground mines. The Jerritt Canyon district comprises over 100 square miles of geologically prospective ground and represents one of the largest contiguous exploration properties in Nevada.

Notes:

(1) "Resources" or "resource" used in this news release are as defined in National Instrument 43-101 of the Canadian Securities Administrators and are not terms recognized or defined by the U.S. Securities and Exchange Commission (SEC). Mineral resources are not reserves and do not have economic viability. For further information, please refer to the risk factors and definitions of reserves and resources in the Company's filings on SEDAR and with the SEC on the Company's website, www.queenstake.com. The Qualified Person for the technical information contained in this news release is Mr. Dorian L. (Dusty) Nicol, President and Chief Executive Officer of Queenstake.

(2) A complete data set, from which the drill results highlighted in this news release were derived, is available as an Appendix to this news release under the Investor Information/News section on the Company's website, www.queenstake.com.

(3) Surface and underground drilling use either core or reverse circulation methods for near-mine and surface exploration programs at Jerritt Canyon. Underground reverse circulation drilling has demonstrated accuracy in ore control definition drilling and for resource conversion at Jerritt Canyon's mines. However, reverse circulation drilling can result in a lower degree of confidence and less geologic information than core drilling.

(4) Results presented in this news release were analyzed using standard fire assay techniques at the Company's Jerritt Canyon laboratory. Intercepts are reported as drilled and are not necessarily "true width".

(5) A description of the geology, sampling procedures and the Company's laboratory Quality Assurance/Quality Control procedures are described in the Company's National Instrument 43-101 Technical Report filed on Sedar on February 23, 2005. This report is available under Investor Information/Financial Information/Sedar Filings at www.queenstake.com.

Cautionary Statement - This news release contains "Forward-Looking Statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended and the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included in this release, and Queenstake's future plans are forward-looking statements that involve various risks and uncertainties. Such forward-looking statements include, without limitation, (i) estimates and projections of reserves and resources, (ii) estimates and opinions regarding geologic and mineralization interpretation and (ii) estimates of exploration investment and scope of exploration programs. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements, in particular the estimates do not include input cost increases that could occur in future. Forward-looking statements are based on the estimates and opinions of management on the date the statements are made, and Queenstake does not undertake any obligation to update forward-looking statements should conditions or management's estimates or opinions change. Forward-looking statements are subject to risks, uncertainties and other factors, including gold and other commodity price volatility, political and operational risks, which are described in in the Company's 2004 Annual Report on Form 40-F on file with the Securities and Exchange Commission as well as the Company's other SEC filings.

SEC file number 0-24096


The Toronto Stock Exchange has neither reviewed nor accepts responsibility for the adequacy or accuracy of this release.

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