Encouraging Results At The Mt. Roe Project

VANCOUVER - NxGold Ltd. has completed the initial mapping program at its 80%-owned Mt. Roe Gold Project located in the Pilbara Gold Region near Karratha, Western Australia.  Due to the encouraging results from the Mt. Roe Project, the Company has given notice to withdraw from the Chicobi Project in order to focus on its Mt. Roe and Kuulu Gold Projects.

The initial mapping program at Mt. Roe has significantly increased the prospective contact from 4km to 7km, greatly increasing the potential scale of the gold target horizons present in the project.  Intense prospector activity, marked by numerous detector holes, were mapped adjacent to the prospective conglomerate contact. 

In addition, NxGold has recovered fine gold at surface which is in addition to the numerous 'melon seed-style' gold nuggets interpreted to be associated with the now extended prospective conglomerate contact. The gold was recovered by sluicing approximately 100kg of remnant scrapings adjacent to the conglomerate contact at Dry-Blower Gully. 

Hand samples and thin sections of conglomerate material from exposed conglomerates, gritty sandstones and sediments associated with a mapped distinctive volcanic horizon inferred to occur stratigraphically below the conglomerate exposure are being reviewed.  A geological model which will be updated as more data is uncovered has been developed which will inform work to test for the thickness of the prospective horizon and distribution of gold.

The Company's next steps include the exposure of the conglomerate unit and its upper and lower contacts, systematic stream and gully sampling along the inferred conglomerate contact to evaluate the gold enrichment, and is contemplating a systematic soil sampling program to further identify potential sources of fine gold on the property. Results of these activities will be reported when available.

Due to the positive results to date at the Company's Mt. Roe project, it has given notice to withdraw from the Chicobi project in order to focus its capital and effort on the Mt. Roe Gold Project in Western Australia.  The Company is also continuing its efforts to obtain the final outstanding surface access license so it may progress the Kuulu Project in Nunavut and remains confident in its position regarding the project.

Christopher McFadden, Chief Executive Officer said, "To increase the strike of the prospective conglomerate contact in the heart of this new gold play by 75% is encouraging.  Work is ongoing to better understand the geology and gold morphology, including sampling near one area of the exposed conglomerate. Additionally, the discovery of fine gold is encouraging as it highlights the potential for a primary-hosted gold system in addition to the conglomerate-hosted model potential which is clearly evident at our Mt. Roe Project. With these results, the Company has made the decision to focus its efforts solely on the Mt. Roe and Kuulu projects and as a result has provided notice of our intention to withdraw from the Chicobi earn-in."