Redstar Gold Corp. ("Redstar") (TSX-V: RGC) and Strategic Merchant Bancorp ("SMB") (TSX-V: SMB) are pleased to report the start of a diamond drilling program on the Pine Nut project in Nevada. The Pine Nut property is underlain by an under explored, large epithermal gold system. Previous work has identified low-sulfidation style epithermal quartz veins up to 4 metres in width. Three major veins are traceable for at least 1,900 metres (6,200 ft) along strike and occupy a zone with a width of about 400 metres (1,300 ft). Gold values at surface reach 37.7 g/t gold (1.1 opt) across approximately 3 metres (central vein), with values exceeding 3 g/t gold (0.09 opt) very common.
Previous reverse circulation drilling on the property intersected values up to 11.45 g/t gold (0.33 opt) over 1.5 metres and 8.06 g/t gold (0.24 opt) over 3.0 metres. This earlier drilling failed to test all the veins, and drill-hole spacing and orientations were inadequate to thoroughly evaluate the high-grade potential of the entire system.
The Phase I program will consist of 6-8 diamond drill holes totaling approximately 2,200 metres (7,000 feet). The program will follow-up the high grade intercepts from previous drilling as well as test previously undrilled portions of the vein system. The objective of the program is to begin to define high grade ore shoots within the vein system.
SMB is currently earning up to a 70% interest in the project from Redstar by making cash payments of $90,000, issuing 450,000 SMB shares and completing 3.0 million dollars of work expenditures over five years. Under the terms of the agreement Redstar will act as operator. SMB also currently holds two additional Nevada projects under option from Redstar (Dry Gulch and North Bullfrog). Drill programs are planned for all three projects this summer or early fall.
Scott Weekes, Redstar's President adds: "The start of drilling on the Pine Nut project is the beginning of an extremely busy exploration season for Redstar and SMB in Nevada. By taking an extremely aggressive approach to high quality exploration projects we believe we can become leaders in Nevada exploration."
Redstar's exploration programs in Nevada are under the supervision of Dr. Jacob Margolis, Exploration Manager USA, for Redstar and a Qualified Person per Canadian NI43-101 standards.
On Behalf of the Board,
Redstar Gold Corp
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