Capstone Gold gets Cozamin resource number

Vancouver – An initial resource estimate has been completed on Capstone Gold’s (CSG-T, CSGLF-O) Cozamin copper-silver-zinc mine in southern Zacatecas State, Mexico.

The study, conducted by Giroux Consultants, reviews measured and indicated resources of 3.4 million tonnes grading 73.5 grams silver per tonne, 1.7% copper, 1.4% zinc and 0.3% lead, at a 1.5% copper equivalent cut-off grade. The resource equates to contained metals of 129 million pounds of copper and 8 million oz. of silver. An additional 4.2 million tonnes grading 57.7 grams silver, 1.5% copper, 1.5% zinc and 0.3% lead was tabled as inferred resource (140 million pounds copper and 7.8 million oz. silver contained), using the same cut-off grade.

The independent resource calculation is based on over 25,000 metres of drilling from 37 surface and 66 underground holes, plus 48 underground channel samples from the workings. Recent metallurgical testing has also shown recovery rates of 94% for copper, 75% for silver and 65% for the zinc.

Capstone is nearing completion of its third phase of underground drilling and anticipates an updated resource estimate in 2006, incorporating the results. The company has now vested its 90% interest in the project from Minero Grupo Bacis, which retains a 10% working interest convertible to a 1.5% net smelter royalty.

The primary mineralized structure on the project is the mesothermal Mala Noche vein, which extends over 5.5 km and ranges from 5-18 metres in width. Copper and silver grades and vein widths show indications of increasing with depth.

An existing 750 tonne-per-day flotation plant, installed in 1997, previously processed about 250,000 tonnes of ore averaging 1.2% copper, 90 grams silver, 0.5 grams gold per tonne, 1.8% zinc and 0.6% lead. The material was extracted mainly from near surface oxide zones. Mine workings extend from the San Roberto mine in the west to the San Bernabe mine in the east.

San Roberto has been dewatered and rehabilitated to level nine, where previous operations were undertaken. Additional underground development is ongoing in preparation for anticipated mining. A ramp to access deeper levels has also been initiated. Further, a portal to construct ramp access to underground workings of the San Ernesto mine has commenced and will eventually connect with an existing, rehabilitated ramp.

The Cozamin resource calculation failed to sustain recent investor bullishness, with the stock shedding almost 15%, to close down 17 at an even $1.00 per share, on volume of 224,000. With its 43.6 million shares outstanding the company posts a $44 million market capitalization.