Sydney Resource Corporation

Sydney Resource Corporation

September 07, 2005 05:00 ET

Sydney Options Northshore Property Adjacent to Lake Shore Gold Deposit, Timmins, Ontario

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 7, 2005) - Sydney Resource Corporation (TSX VENTURE:SYR) (the "Company" or "Sydney") reports that it has acquired a 70% option interest in gold mineral rights, called the Northshore Property, immediately adjacent to the newly discovered Timmins West deposit of Lake Shore Gold Corp. The Lake Shore deposit has a resource announced in September 2004 of 16.45 g/T gold in 1,369,000 tonnes containing 724,000 ounces indicated (Lake Shore Gold, SEDAR 43-101). At the time of Sydney's property due diligence, a Lake Shore drill rig was operating less than 85 metres from the Northshore property boundary. The Northshore property has an immediate target for drilling based on simple geometry from the published Timmins West deposit.

Drilling reported on the adjacent property has since extended the mineralized zone 450 metres down plunge beyond the limits of the announced resource. This drilling includes the discovery of the deep sediment zone which plunges northwest towards the Sydney Northshore property. Based on currently available information the gold bearing structure is anticipated to cross the property boundary at a depth of between 1,000 and 1,400 and is open. The Timmins gold camp historically has produced over 70 million ounces. Deposits in the Timmins' camp typically have excellent vertical continuity down to over 2,000 metres. The attractive grade profile of the Timmins West deposit and its location, in the world class Timmins' Gold Camp, makes this target extremely attractive.

Under the terms of the Option Agreement Sydney may earn a 50% interest in the Joint Venture on the Northshore Property by making an initial cash payment of $500,000 issuing 250,000 common shares and incurring $3,000,000 in exploration expenditures over 3 years. Upon earning the initial 50% interest Sydney may elect to earn a further 20% interest in the Property by completing a National Instrument 43-101 compliant Resource Statement showing a minimum Resource of 750,000 ounces of gold or gold equivalent, and preparing an industry standard Feasibility Study within an additional 5 year period.

Closing of the Option Agreement is subject to the Company raising $500,000 in a single non-brokered private placement, by the issue of 2.5 million shares of Sydney at a price of $0.20 cents and raising an additional $1,000,000 million dollars by means of a flow-through share issue at a minimum price of $0.25 per flow-through share. Other conditions include final verification of Title and approval of the TSX Venture Exchange for the Option Agreement and the two financings outlined above.

Malcolm Swallow, Sydney's President said, "The Northshore Project provides a clear target for drilling just a few metres from operating drill rigs on a high grade gold deposit. Sydney will move to commence drilling immediately upon closing of the transaction and associated financings."

About Sydney

Sydney Resource Corporation is an exploration and development company based in Vancouver, Canada, focused on exploring and developing gold, silver and associated base metals projects in the America's. Sydney currently has projects in the Abitibi, Cariboo and Sierra Madre gold districts of Canada and Mexico.


Malcolm J.A. Swallow, President and CEO

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

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