Silver Quest Resources Ltd.
TSX VENTURE : SQI

Silver Quest Resources Ltd.

January 20, 2011 08:00 ET

Silver Quest Announces Updated NI 43-101 Resource Estimate for Capoose Project, BC

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 20, 2011) - Silver Quest Resources (TSX VENTURE:SQI) ("Silver Quest" or "the Company") is pleased to announce that GeoVector Management Inc. has prepared an updated National Instrument ("NI") 43-101 resource estimate for its 100% owned Capoose Deposit. The updated resource estimate represents a significant increase from the 2010 resource estimate (SEDAR filed on April 16, 2010) with approximately 45% of the 2010 resource being upgraded to the Indicated resource category. The Capoose Project is located 185 km southwest of Prince George, British Columbia. For more information visit the Company's website at www.silverquest.ca.

2011 Mineral Resource Estimate

The 2011 updated mineral resource estimate is based on an additional 37 infill and step-out drill holes (10,600 metres) and more than 5,300 assay values collected from the 2010 drill Program. The resource estimate is categorized as Indicated and Inferred as defined by the CIM guidelines for resource reporting. Mineral resources do not demonstrate economic viability, and there is no certainty that these mineral resources will be converted into mineable reserves once economic considerations are applied.

The resource estimate at a gold equivalent ("AuEq") cut-off grade of 0.40 grams per tonne ("g/t") is 31.22 million tonnes grading 0.38 g/t gold and 26.5 g/t silver for 383,823 contained ounces of gold and 26,593,915 contained ounces of silver in an Indicated category and 37.23 million tonnes grading 0.37 g/t gold and 24.6 g/t silver for 443,206 contained ounces of gold and 29,517,933 contained ounces of silver in an Inferred category. 

Results at various gold equivalent cut-off grades are tabulated below. Silver Quest has also calculated Indicated and Inferred resource values for zinc, as reported below. The zinc value is not included in the gold equivalent calculation. 

To view the tables associated with this release, please click here: http://media3.marketwire.com/docs/SQI0120tables.pdf.

Resource Estimation Process

The resource estimate is based on more than 10,000 assay values from 147 drill holes (totaling > 26,000 metres). Assay values were verified against drill logs and assay certificates. Drill hole collar locations and down-hole surveys were checked and verified. The mineral resource was estimated using two metre composites of the assay values, with "zero" grade inserted into intervals that were not sampled. Composite values were capped at 5.0 g/t gold and 200 g/t silver.

A geological model was constructed of the Au-Ag mineralized zone. This model was used to constrain the composite values chosen for interpolation, and the ore blocks reported in the mineral resource. A block model was constructed using 10 m x 10 m x 5 m blocks in the x, y, and z direction respectively. Grades for gold and silver were interpolated into the blocks by the inverse distance squared method using a minimum of 4 and maximum of 20 composites (within a minimum of two drill holes) to generate block grades in the Indicated category and a minimum of 2 and maximum of 12 composits to generate block grades in the Inferred category.

The Indicated and Inferred mineral resource estimate has been prepared in compliance with the standards of NI 43-101 by Dr. A. Armitage, P. Geol., and J. Campbell, B.Sc., P. Geo., of GeoVector Management Inc. an Ottawa, Ontario consulting firm specializing in resource estimation, project assessment and project management. Dr. Armitage acted as the Qualified Person, as defined in NI 43-101 and is independent of the Company. The updated NI 43-101 report will be finalized and filed on SEDAR within 45 days of the date of this news release. GeoVector has reviewed and approved the technical information in this news release.

David Pawliuk, P. Geo., Vice-President Exploration for Silver Quest is the Qualified Person, as defined by NI 43-101, for the Capoose project and has reviewed the technical information in this release.

SILVER QUEST RESOURCES LTD.

Randy Turner, President

Certain of the statements made and information contained herein is "forward-looking information" within the meaning of the British Columbia Securities Act. This includes statements concerning the Company's plans at its mineral properties, which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Forward-looking information is subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking information, including, without limitation, the ability of the Company to continue to be able to access the capital markets for the funding necessary to acquire and maintain exploration properties and to carry out its desired exploration programs; inability to fund the Company's share of costs incurred under joint venture agreements to which it is a party, and reduction or elimination of its joint venture interest as a result; competition within the minerals industry to acquire properties of merit, and competition from other companies possessing greater technical and financial resources; difficulties in executing exploration programs on the Company's proposed schedules and within its cost estimates, whether due to weather conditions in the areas where it operates, increasingly stringent environmental regulations and other permitting restrictions, or other factors related to exploring in the north, such as the availability of essential supplies and services; factors beyond the capacity of the Company to anticipate and control, such as the marketability of minerals, government regulations relating to health, safety and the environment, the scale and scope of royalties and taxes on production; unusually mild winter conditions affecting or delaying the opening of the winter roads and resulting difficulties in transporting materials needed to support various exploration projects and resulting increased costs of transport by air; the availability of experienced contractors and professional staff to perform work in a competitive environment and the resulting adverse impact on costs and performance and other risks and uncertainties, including those described in each management discussion and analysis. In addition, forward-looking information is based on various assumptions including, without limitation, assumptions associated with exploration results and costs and the availability of materials and skilled labour. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements. Accordingly, readers are advised not to place undue reliance on forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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