Queenstake Expands Known Gold Mineralization at Jerritt Canyon Mines
May 08 2006 - 9:00AM
PR Newswire (US)
DENVER, May 8 /PRNewswire-FirstCall/ -- Underground drilling by
Queenstake Resources Ltd. (TSX: QRL, Amex: QEE) intercepted
high-grade gold mineralization expanding the known deposits at the
SSX Mine and Smith Mine at the Jerritt Canyon operations in
Northeastern Nevada. At the SSX Mine, a 130- foot interval grading
0.55 ounce of gold per ton (opt) or 39.6 meters grading 19 grams
per tonne (gpt) was identified in drilling at Zone 4. Results from
the Smith Mine included 55 feet grading 0.67 opt (16.8 meters of 23
gpt) along the northwest extensions at the R4 dike trend and 35
feet grading 0.73 opt (10.7 meters of 25 gpt) at the Mahala
deposit. In addition, an unexpected discovery of a 20-foot interval
of 0.38 opt (6.1 meters of 13 gpt) of additional gold
mineralization was made at the West Dash deposit at the Smith Mine,
while drilling an access hole to run an electric power line from
the underground drift to the surface. Subsequent drilling from
surface successfully expanded the shape of the defined
mineralization comprising the West Dash deposit, which is expected
to begin commercial production through the Smith Mine portal in the
second half of 2006. The Murray Mine, which was originally expected
to close at the end of March 2006, continues to generate positive
drilling results that are extending its productive life. Drilling
in the Zone 5W area encountered an interval of 30 feet grading 0.95
opt (9.1 meters of 32 gpt), adding high-grade mineralization that
will be mined this quarter. Commenting on the exploration results,
President and Chief Executive Officer Dorian L. (Dusty) Nicol said,
"The Jerritt Canyon operations continue to realize their potential
for expansion of existing deposits. The discovery of the additions
to the West Dash deposit during the drilling of a power line access
hole and additional pockets of gold mineralization at the Murray
Mine, which will extend its currently planned productive life to at
least mid-year 2006, are positive examples of this potential. "The
encouraging exploration results from the Smith Mine further
reinforce our expectations that its mine life can be extended
beyond 2008. At the SSX- Steer Complex, underground drilling
continues to deliver good results in Zones 2 and 4. We are
currently using our new drill along the SSX-Steer connection to
explore this prospective area between the SSX and Steer mines." The
improving weather is expected to allow startup of surface drilling
soon at Starvation Canyon, with a second drill expected to be
turning within a month. In addition, two drills are active in the
northern part of the district following up on the favorable results
at West Dash and testing additional targets. The exploration
results(1) from underground reverse circulation and core
drilling(2) and surface reverse circulation drilling(2) described
in this news release are outside of the boundary of resources(3)
identified at year-end 2005 (refer to the March 5, 2006 news
release announcing reserves(3) and resources). The data highlighted
below in the tables reflect drilling conducted from January through
April 2006 and report drill intercepts of 10 feet or more at a
grade of 0.20 opt or higher (>3 meters of approximately 7 gpt or
better). The SSX Mine drill highlights in the table below were
selected from 118 reverse-circulation and eight core holes totaling
17,700 feet or (5,395.0) meters completed. The SSX Mine is being
operated as part of the combined SSX- Steer Complex. Additional
follow-up drilling is planned to further define the mineralization
in Zones 2 and 4 and to pursue the mineralized extension along the
South Boundary Fault where hole SX-986 encountered an intercept of
43 feet (13.1 meters) of 0.45 opt (16 gpt). Table 1: SSX Mine
Underground Results Highlights(4),(5) From To Length Grade Drill
Hole # (feet) (feet) (feet) (opt) Type Z23417 155 170 15 0.541 RC
Z23430 125 140 15 0.441 RC Z23430 195 210 15 0.174 RC Z23431 225
255 30 0.155 RC Z41199 80 110 30 1.196 RC SX-986 322 365 43 0.451
Core Z50734 0 130 130 0.551 RC The Smith Mine drill highlights in
the table below were from 31 reverse- circulation and 13 core holes
totaling 7,430 feet (2,264.6 meters) completed. Mineralization
remains open to the northwest and will be followed up with further
drilling. The surface reverse-circulation drilling program at West
Dash deposit also completed 12 reverse-circulation holes totaling
6,110 feet and the highlights are shown in Table 3. The best
intercept from this surface drilling program was 25 feet (7.6
meters) of 0.36 opt (12 gpt). At year-end 2005, gold resources,
including reserves(3), at West Dash were estimated at 70,300
ounces. The surface drilling program at West Dash is continuing
with a further 10 holes of definition drilling planned to the west
and southwest. Table 2: Smith Mine Underground Results
Highlights(4),(5) From To Length Grade Drill Hole # (feet) (feet)
(feet) (opt) Type LX-624 135 145 10 0.294 Core and 160 175 15 0.230
" LX-628 145 200 55 0.669 Core LX-635 110 120 10 0.631 Core C40424
235 250 15 0.284 RC C40384 65 100 35 0.728 RC C40385 75 100 25
0.601 RC C40390 75 110 35 0.184 RC C40396 85 120 35 0.211 RC C40403
85 100 15 0.269 RC C40270 140 160 20 0.362 RC C40267 115 145 30
0.430 RC Table 3: Smith Mine - West Dash Surface Results
Highlights(4),(5) From To Length Grade Drill Hole # (feet) (feet)
(feet) (opt) Type SH-1103 255 365 110 0.125 RC with 285 300 15
0.165 RC with 335 355 20 0.375 RC SH-1106 265 305 40 0.247 RC with
270 295 25 0.362 RC SH-1107 270 365 95 0.100 RC with 315 325 10
0.226 RC with 330 345 15 0.215 RC SH-1110 255 340 85 0.088 RC with
295 300 5 0.216 RC with 305 310 5 0.176 RC SH-1111 240 265 25 0.300
RC with 245 255 10 0.698 RC SH-1112 245 260 15 0.258 RC SH-1113 270
275 5 0.136 RC SH-1114 250 350 100 0.051 RC with 260 275 15 0.128
RC with 265 270 5 0.206 RC The Murray Mine drill highlights in the
table below were from four reverse-circulation holes totaling 610
feet (185.9 meters) completed. Additional drilling is currently
underway in this area to determine further production
possibilities. Table 4: Murray Mine Underground Results Highlights
(4) (5) From To Length Grade Drill Hole # (feet) (feet) (feet)
(opt) Type C54459 160 190 30 0.945 RC C54458 35 55 20 0.271 RC
C54458 75 85 10 0.758 RC Queenstake Resources Ltd. is a gold mining
and exploration company based in Denver, Colorado. Its principal
asset is the wholly owned Jerritt Canyon gold operations in Nevada.
Jerritt Canyon has produced over seven million ounces of gold from
open pit and underground mines since 1981. Current production at
the property is from underground mines. The Jerritt Canyon District
comprises 119 square miles (308 square kilometers) of geologically
prospective ground, controlled by Queenstake, representing one of
the largest contiguous exploration properties in Nevada. Notes: (1)
A complete data set, from which the drill results highlighted in
this news release were selected, is available as an Appendix to
this news release under the Investor Information/News section on
the Company's website, http://www.queenstake.com/. (2) Surface and
underground drilling use either core or reverse circulation (RC)
methods for near-mine exploration programs at Jerritt Canyon.
Reverse circulation drilling has demonstrated accuracy in ore
control definition drilling and for resource conversion at Jerritt
Canyon mines. However, reverse circulation drilling can result in a
lower degree of confidence and less geologic information than core
drilling. (3) "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 demonstrated 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,
http://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. (4)
Results presented in this news release were analyzed using standard
fire assay techniques at the Company's Jerritt Canyon laboratory
and at the ALS Chemex labs in Elko and Reno. Intercepts are
reported as drilled and are not necessarily "true widths," which
have not yet been calculated. (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 May
4, 2006. This report is available under Investor
Information/Financial Information/SEDAR filings at
http://www.queenstake.com/. For further information call: Wendy
Yang, 303-297-1557 ext. 105 800-276-6070 Email - Web
-http://www.queenstake.com/ Cautionary Statement - This news
release contains "Forward-Looking Statements" within the meaning of
applicable Canadian securities regulations and 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 and (ii) estimates and
opinions regarding geologic and mineralization interpretation.
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 the Company's 2005 Annual Information
Form filed on SEDAR and 2005 Annual Report on Form 40-F on file
with the Securities and Exchange Commission as well as the
Company's other regulatory filings. DATASOURCE: Queenstake
Resources Ltd. CONTACT: Wendy Yang of Queenstake Resources Ltd.,
+1-303-297-1557, ext. 105, or 1-800-276-6070, Web site:
http://www.queenstake.com/
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