NEWS RELEASE TRANSMITTED BY CCNMatthews
FOR: GOWEST AMALGAMATED RESOURCES LTD.
TSX VENTURE SYMBOL: GWA
OCTOBER 15, 2004 - 10:43 ET
New Gold Property for Gowest
TORONTO, ONTARIO--(CCNMatthews - Oct. 15, 2004) - Gowest Amalgamated
Resources Ltd. ("Gowest") and Jonpol Investments Ltd. ("JIL"), an arm's
length private company, have signed a letter of intent with an arm's
length third party (the "Vendor") to enter into an option agreement (the
"Option Agreement") under which Gowest and JIL will be granted the
option to acquire from the Vendor six mining claims located 48 km
northwest of Wawa, Ontario (the "Option Property"). Each of Gowest and
JIL will hold a 50% interest in the Option Agreement and, if the option
is exercised, the underlying claims.
Pursuant to the Option Agreement an initial payment of $60,000 and
200,000 common shares of Gowest will be made and, in order to maintain
and exercise the option, four subsequent annual payments totaling
$80,000 and 600,000 common shares of Gowest must be made, subject to
regulatory approval. Each of Gowest and JIL will be responsible for 50%
of these payments. In order to exercise the option, $200,000 must be
incurred on exploration expenditures annually for five years (totaling
of $1 million). The Vendor will retain a 3% net smelter return royalty
(the "NSR"), subject to Gowest's and JIL's right to purchase 50% of such
NSR at the rate of $500,000 for each 1/2%.
The Vendor has applied, on behalf of Gowest and JIL, to lease mining
rights covering eight square kilometres located adjacent and to the east
of the Option Property (the "Leased Claims"). The terms of the lease are
currently being negotiated with the holder of the mineral rights (a
private company at arm's length to Gowest). It is anticipated that the
lease will provide for a $4000 initial payment, an annual requirement to
conduct at least $2,000 in mineral exploration or pay $1,000 in lieu
thereof, and a 3% NSR to be retained by the lessor, subject to Gowest's
and JIL's right to purchase a portion of such NSR at the rate of
$500,000 for each 1/2%. If the lease is granted to Gowest and JIL, the
Vendor will be granted a 1% NSR in the Leased Claims, subject to
Gowest's and JIL's right to purchase 50% of such NSR for $500,000.
The Option Property and the Leased Claims cover 1328 hectares, including
a 6 km strike length of stratified rocks which are favourable to gold
mineralization.
An independent geologist on behalf of Gowest visited the properties on
September 10th and reviewed all pertinent records. The prospector -
vendor first discovered gold on the property while staking in March of
1998. Subsequently, during prospecting and stripping, several other
occurrences were discovered in the vicinity, over a length of 395 m and
a width of 100 m. The gold is hosted by differing rock types including
quartz carbonate main vein structure and sericite schist, the most
interesting host; it contains high grade gold. The only previous work in
the area of the gold mineralization was conducted by the Vendor and
consisted of stripping and sampling the rock exposure over the past five
years.
Gowest's geologist selected a number of grab samples from various
locations, nearby locations of previous samples, primarily to confirm
the previous assays. The assays of the grab samples did, in general,
confirm previous results and also indicated a very wide range in gold
content. Also, the samples contained an unusually high silver content,
the significance of which has yet to be ascertained. The presence of
substantial free, visible gold would account for the wide range of
values and only mediocre correlation between adjacent samples.
/T/
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Sample Location Mineralization Value g/t Value g/t
gold silver
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No. 1 15 m north of quartz sericite 385.4 (i) 22.8(i)
main vein schist with visible
gold
A previous channel sample nearby assayed 222.6 g/t over a width of 0.61
m.
No. 2 3 m N of main quartz sericite 8.8 1.2
vein schist
A previous channel sample nearby, assayed 31.49 g/t over 0.5 m.
No. 3 5 m E of No. 2 siliceous tuff 2.8 2.3
Nearby a previous channel sample which assayed 24.7 g/t gold over
1.0 m.
No. 4 main vein quartz and sulphides 1.6 7.2
Two metres from channel sample which assayed 0.03 g/t gold
No. 5 east end of sheared felsic tuff 9.2 8.4
main vein and quartz
No. 6 west end of quartz carbonate 0.05 0.3
main vein
No. 7 10 m S of main sheared felsic tuff 10.4 2.6
vein
Adjacent to channel sample which assayed 1.5 g/t gold over 1.5 m.
No. 8 near E end of quartz carbonate 0.29 1.0
main vein
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(i) equivalent to 12.4 oz/ton gold and 0.73 oz/ton silver
Swastika Laboratories, an accredited facility, did the assay work
using conventional fire assay methods.
/T/
According to the Gowest geologist, whom researched assessment work
files, a considerable amount of exploration work has been conducted in
the on the Leased Claims over the past 20 years by Battle Mountain and
other companies. Although significant gold mineralization was
discovered, it lacked required dimensions. The work does, however,
confirm that favourable geological terrane exists in that area.
The writer, Ronald J. Bradshaw, the qualified person responsible for
verification of the information and data used in this release, is
satisfied that the information and data meet the appropriate standards.
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
Gowest Amalgamated Resources Ltd
Ronald J. Bradshaw
President
(519) 538-5858
(519) 538-5530 (FAX)
The TSX Venture Exchange has neither approved or disapproved the
information contained herein.
