New Gold Releases Encouraging Initial Results from the Cerro San Pedro Sulfide Drill Program and Reports on the Amapari Sulfide Scoping Study



    (All figures are in US dollars unless otherwise stated)

    VANCOUVER, April 9 /CNW/ - New Gold Inc. ("New Gold") (TSX and NYSE:  AMEX
- NGD) is pleased to announce the results of the first five diamond drill
holes from its Cerro San Pedro Sulfide ("CSP Sulfide") exploration project in
San Luis Potosi, Mexico, which include an intersection of 51.9 meters of
manto-style sulfide mineralization averaging 2.08 g/t gold, 131.8 g/t silver,
6.14% zinc and 2.01% lead, followed by 169 meters of porphyry sulfide
mineralization averaging 0.61 g/t gold, 12.8 g/t silver, 0.48% zinc and 0.14%
lead beginning at a vertical depth of approximately 400 meters from surface
(Hole CSPD-05C).
    In addition to these exciting results at Cerro San Pedro, New Gold is
pleased to report on the recently completed Scoping Study for the sulfide
resources at Amapari.

    Cerro San Pedro Sulfide Drill Program

    The CSP Sulfide project is focused on an area between the company's
current open pit gold-silver mine ("Oxide Pit') and the area of historic
underground mining some 500 meters to the southwest. The Cerro San Pedro mine
which commenced operations in 2007 is expected to produce between 90,000 and
100,000 ounces of gold and between 1.1 and 1.3 million ounces of silver in
2009. New Gold controls a 100% interest in the CSP Sulfide project.
    Seven holes have been completed to date with all holes bottoming in
mineralization after encountering significant thicknesses of manto and
porphyry style sulfide mineralization. Assays received for the first five
holes along with a complete listing of drill hole location coordinates and
corresponding map are attached to this press release and are available on New
Gold's website.
    New Gold's President and CEO, Robert Gallagher said; "The initial results
from the CSP Sulfide project are very encouraging. All holes have encountered
both manto and porphyry style sulfide mineralization where it was expected.
These results attest to the strength of the primary sulfide mineralization
system at Cerro San Pedro. It is our objective to continue to evaluate the
exploration upside of the CSP Sulfide project, through an active drilling
campaign for the balance of this year. It's also interesting to note the
similarity to the porphyry mineralization to grades seen at the neighboring
Penasquito Mine to the north."
    The holes range in vertical depth from 450 to 650 meters from surface and
were drilled adjacent to an area of historic underground mining where from
1928 to 1948 the Asarco company is reported to have produced approximately
235,000 ounces of gold, 20 million ounces of silver, 405 million pounds of
zinc, 224 million pounds of lead, and 93 million pounds of copper from a
manto-style ore body. The Asarco manto occurs along the contact between a
sequence of tectonically folded and faulted limestones and the San Pedro
porphyry intrusive which hosts the bulk of gold and silver-bearing oxide
mineralization currently being mined by open pit to the north. Sulfide
mineralization in the San Pedro porphyry below the Asarco mine appears to be a
continuation of a zone of gold-silver-zinc-lead bearing sulfide mineralization
that occurs immediately beneath the current CSP oxide pit located
approximately 500 meters to the north.
    The objective of the CSP Sulfide project is to continue to explore
extensions to the historic Asarco manto system and to test the continuity of
sulfide mineralization as it extends between the historic Asarco mine and the
current oxide open pit. The results of these first five holes confirm the
presence of additional manto-style mineralization adjacent to the historic
Asarco mine workings and indicate potential may also exist for a zone of
porphyry hosted sulfide mineralization extending from beneath the current
oxide open pit and the historic Asarco mine to the south. The gold, silver,
zinc and lead grades encountered in the drilling program to date are similar
to the grades of sulfide mineralization at Goldcorp's Penasquito project in
neighboring Zacatecas state, and represent a sulfide target meriting further
exploration. Because this zone is only partially explored at present, no
mineral reserves and resources have been delineated for the CSP Sulfide
project and the current estimates of mineral reserves and resources for Cerro
San Pedro do not include material from the sulfide mineralization.
    This first phase of the CSP Sulfide project includes a further 2,900
meters of drilling and New Gold has recently commissioned a second core rig to
accelerate the program for completion during the second quarter. The company
is also developing plans for a second phase of exploration that, if drilling
results continue to prove positive, would involve further delineation drilling
to define the overall size and extent of the CSP Sulfide system and, if
results warrant, a scoping study during the second half of 2009.
    ALS Chemex of Vancouver, British Columbia, Canada has completed all of
New Gold's analytical work for this drilling campaign. The analytical method
used is fire assay with atomic absorption finish for gold and silver and
geochemical ICP analysis for zinc, lead and copper. ALS Chemex is certified by
the ISO 9001:2000 and ISO 17025:2005 standards. Additionally, New Gold
maintains a rigorous and systematic quality control program using project
specific analytical standards and blanks. The Qualified Person, as defined by
Canadian NI 43-101, responsible for the design and conduct of the work
performed is Mr. Mark A. Petersen, Certified Professional Geologist and Vice
President of Exploration for New Gold Inc.

    Amapari Sulfides Scoping Study

    New Gold is also pleased to report that AMC Mining Consultants (Canada)
Ltd (AMC) has completed a Scoping Study to assess the potential for mining of
sulfide mineral resources and the remaining oxide mineral resources with a new
project involving the construction of a two stage ball mill and
carbon-in-leach ("CIL") processing plant at the company's Amapari project in
northern Brazil. The Amapari open pit operation was placed on temporary care
and maintenance in January 2009 due to the increasing occurrence of transition
oxide material in the pits that was not economic under the current crushing
and heap leach processing set-up. Mining of the sulfide mineral resources has
not previously been evaluated in a pre-feasibility study or feasibility study.
    Amapari has previously disclosed mineral resources containing a total of
1.14 million gold ounces in the measured and indicated categories (22.9
million tonnes at 1.54 g/t Au) of which 63% are in sulfides and 1.04 million
gold ounces in the inferred category (13.7 million tonnes at 2.37 g/t Au) of
which 93% are in sulfides.

    
    Below are the primary parameters used in AMC's Scoping Study which
examines the potential for mining of the sulfide and the remaining oxide
mineralization via a combination of open pit and underground mining and
processing by conventional milling and a CIL plant.

    -   Gold price of $US750 per ounce and BRL to US$ exchange rate of 1.90.

    -   The conceptual mine design and plan assumes extensions to, and
        deepening of three existing conventional open pits, and an
        underground mine employing open stoping.

    -   Steady state production of around one million tonnes per year from
        open pit mining and 0.5 million tonnes per year from underground
        mining. Conventional crush-grind-CIL processing achieving 90%
        recovery. Gold production would average 86,000 ounces per year over
        the 14 year life of the project, averaging 100,000 ounces per year
        for the second through ninth year of the project.

    -   Initial preliminary capital expenditures estimates of approximately
        $110 million which include engineering, procurement and construction
        costs for the proposed new mill, open pit, and underground mine
        development. Life of mine sustaining capital totals $107 million.
        Operating costs per tonne of ore developed in the study are $8.96 for
        open pit mining, $17.47 for underground mining, $10.85 and $12.51 for
        processing of oxides and sulfides respectively and $5.00 for general
        and administrative costs.

    -   Life of mine projected cash flow of US$112 million (constant 2009
        dollars, before taxes and depreciation) with Net Present Value at 5%
        discount rate of US$41 million and an Internal Rate of Return of
        11 percent. A 10% change in gold price results in differences of
        about US$90 million in Net Cash Flow and US$60 million in Net Present
        Value.
    

    This assessment is preliminary in nature, containing inferred mineral
resources that are considered too speculative geologically to have the
economic consideration applied to them that would enable them to be
categorized as mineral reserves. There is no certainty that the preliminary
assessment will be realized. AMC has made a number of recommendations for
additional work to further assess the potential for development of the sulfide
and oxide mineral resource at Amapari including additional drilling to upgrade
the classification of the current Inferred mineralization resource inventory
to Measured and Indicated status.
    Robert Gallagher, President and CEO of New Gold said: "The AMC Scoping
Study indicates that there is potential for the economic exploitation of the
remaining oxide and sulfide mineral resource at Amapari. Additional work is
justified to improve the reliability of the estimates and to further
investigate the opportunities that exist. In addition, New Gold's land package
extends over a 100 kilometer long trend of prospective greenstone terrain in
the prolific Guyana Shield, offering exploration potential beyond that of the
area of study in the AMC Scoping Study."

    New Gold is an intermediate gold mining company with operating assets in
Mexico and Australia and two development projects in Canada and Chile. For
further information on New Gold, please visit our website at www.newgold.com.

    CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

    Certain information contained in this press release, including any
information relating to New Gold's future financial or operating performance,
may be deemed "forward looking". All statements in this press release, other
than statements of historical fact, that address events or developments that
New Gold expects to occur, are "forward-looking statements". Forward-looking
statements are statements that are not historical facts and are generally, but
not always, identified by the words "expects", "does not expect", "plans",
"anticipates", "does not anticipate", "believes", "intends", "estimates",
"projects", "potential", "scheduled", "forecast", "budget" and similar
expressions, or that events or conditions "will", "would", "may", "could",
"should" or "might" occur. All such forward looking statements are subject to
important risk factors and uncertainties, many of which are beyond New Gold's
ability to control or predict. Forward-looking statements are necessarily
based on estimates and assumptions that are inherently subject to known and
unknown risks, uncertainties and other factors that may cause New Gold's
actual results, level of activity, performance or achievements to be
materially different from those expressed or implied by such forward-looking
statements. Such factors include, without limitation: New Gold's operations
are subject to significant capital requirements; fluctuations in the
international currency markets and in the rates of exchange of the currencies
of Canada, the United States, Australia, Brazil, Mexico and Chile; price
volatility in the spot and forward markets for commodities; impact of any
hedging activities, including margin limits and margin calls; discrepancies
between actual and estimated production, between actual and estimated reserves
and resources and between actual and estimated metallurgical recoveries;
changes in national and local government legislation in Canada, the United
States, Australia, Brazil, Mexico and Chile or any other country in which New
Gold currently or may in the future carry on business; taxation; controls,
regulations and political or economic developments in the countries in which
New Gold does or may carry on business; the speculative nature of mineral
exploration and development, including the risks of obtaining necessary
licenses and permits; diminishing quantities or grades of reserves;
competition; loss of key employees; additional funding requirements; actual
results of current exploration or reclamation activities; changes in project
parameters as plans continue to be refined; accidents; labour disputes;
defective title to mineral claims or property or contests over claims to
mineral properties. In addition, there are risks and hazards associated with
the business of mineral exploration, development and mining, including
environmental hazards, industrial accidents, unusual or unexpected formations,
pressures, cave-ins, flooding and gold bullion losses (and the risk of
inadequate insurance or inability to obtain insurance, to cover these risks)
as well as "Risks Factors" included in New Gold's Annual Information Form
filed on March 31, 2009, and available at www.sedar.com. Forward-looking
statements are not guarantees of future performance, and actual results and
future events could materially differ from those anticipated in such
statements. All of the forward-looking statements contained in this press
release are qualified by these cautionary statements. New Gold expressly
disclaims any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, events or otherwise,
except in accordance with applicable securities laws.

    
    CAUTIONARY NOTE TO U.S. READERS CONCERNING ESTIMATES OF MEASURED,
    INDICATED AND INFERRED RE

SOURCES Information concerning the properties and operations of New Gold has been prepared in accordance with Canadian standards under applicable Canadian securities laws, and may not be comparable to similar information for United States companies. The terms "Mineral Resource", "Measured Mineral Resource", "Indicated Mineral Resource" and "Inferred Mineral Resource" used in this press release are Canadian mining terms as defined in accordance with NI 43-101 under guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council on December 11, 2005. While the terms "Mineral Resource", "Measured Mineral Resource", "Indicated Mineral Resource" and "Inferred Mineral Resource" are recognized and required by Canadian regulations, they are not defined terms under standards of the United States Securities and Exchange Commission. Under United States standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve calculation is made. As such, certain information contained in this press release concerning descriptions of mineralization and resources under Canadian standards is not comparable to similar information made public by United States companies subject to the reporting and disclosure requirements of the United States Securities and Exchange Commission. An "Inferred Mineral Resource" has a great amount of uncertainty as to its existence and as to its economic and legal feasibility. It cannot be assumed that all or any part of an "Inferred Mineral Resource" will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all or any part of Measured or Indicated Resources will ever be converted into Mineral Reserves. Readers are also cautioned not to assume that all or any part of an "Inferred Mineral Resource" exists, or is economically or legally mineable. In addition, the definitions of "Proven Mineral Reserves" and "Probable Mineral Reserves" under CIM standards differ in certain respects from the standards of the United States Securities and Exchange Commission. To view Figure 1: Cerro San Pedro Sulfide Project - Drill Hole Locations & Surface Geology Map - April, 2009, please visit the following link: http://files.newswire.ca/764/Cerro_San_Pedro.pdf ------------------------------------------------------------------------- Cerro San Pedro Sulfide Project - Drill Hole Collar Locations ------------------------------------------------------------------------- Drill Northing Easting Elevation Length Azimuth Inclination Hole UTM UTM (masl) (m) ------------------------------------------------------------------------- CSPD-01C 2457167 313724 2004 693.0 050(degrees) -75(degrees) ------------------------------------------------------------------------- CSPD-02C 2457425 313892 2009 462.0 0(degrees) -90(degrees) ------------------------------------------------------------------------- CSPD-03C 2457502 313888 2010 543.0 0(degrees) -90(degrees) ------------------------------------------------------------------------- CSPD-04C 2457251 313777 1995 699.0 0(degrees) -90(degrees) ------------------------------------------------------------------------- CSPD-05C 2457366 313763 1998 713.0 085(degrees) -73(degrees) ------------------------------------------------------------------------- CSPD-06C 2457575 313875 2017 500.0 0(degrees) -90(degrees) ------------------------------------------------------------------------- CSPD-07C 2457325 313735 1996 In 0(degrees) -90(degrees) progress ------------------------------------------------------------------------- CSPD-08C 2457576 313876 2017 522.0 090(degrees) -70(degrees) ------------------------------------------------------------------------- The table below provides a summary of results for the drill holes reported herein: ------------------------------------------------------------------------- Cerro San Pedro Sulfide Project - Drill Hole Results ------------------------------------------------------------------------- Rock Type / Drill From To Length Au Ag Zn Pb Cu Mineralization Hole (m) (m) (m) (g/t) (g/t) (%) (%) (%) Comments ------------------------------------------------------------------------- CSPD-01C 0.0 459.6 459.6 0.03 1.1 na na na Limestone 459.6 460.1 0.5 1.83 982.0 14.35 15.80 0.50 Manto-style sulfides 460.1 507.8 47.7 0.01 0.8 na na na Limestone 507.8 513.3 5.5 0.06 1.8 0.06 0.02 0.00 Porphyry 513.3 518.0 4.7 3.18 375.5 16.90 5.19 0.17 Manto-style sulfides 518.0 524.0 6.0 1.73 40.3 1.82 0.54 0.03 Manto-style sulfides 524.0 693.0 169.0 0.58 12.2 0.65 0.14 0.01 Porphyry - ----- ----- ----- ---- ---- ---- ---- ---- entire interval ---------- includes 524.0 544.0 20.0 1.01 27.6 0.85 0.39 0.02 Porphyry includes 544.0 680.0 136.0 0.46 8.8 0.58 0.09 0.01 Porphyry includes 680.0 690.0 10.0 1.47 28.6 1.33 0.21 0.03 Porphyry includes 690.0 693.0 3.0 0.140 6.6 0.32 0.07 0.01 Porphyry ------------------------------------------------------------------------- CSPD-02C 0.0 372.0 372.0 0.03 2.4 na na na Limestone 372.0 378.0 6.0 0.93 40.7 2.22 0.40 0.01 Limestone (poor core rec'vy) 378.0 381.0 3.0 na na na na na Void - mine working 381.0 387.0 6.0 0.96 80.2 2.18 1.16 0.02 Manto-style sulfides 387.0 396.0 9.0 1.68 171.1 9.25 2.15 0.03 Manto-style sulfides 396.0 424.0 28.0 0.04 2.1 0.04 0.03 0.00 Limestone 424.0 426.0 2.0 na na na na na Void - mine working 426.0 431.2 5.2 1.41 517.5 16.80 9.07 0.33 Manto-style sulfides 431.2 432.2 1.0 na na na na na Void - mine working 432.2 434.6 2.4 3.75 33.5 7.66 0.29 0.01 Manto-style sulfides 434.6 462.0 27.4 0.29 8.5 0.39 0.12 0.01 Porphyry (hole terminated early by bad ground conditions) ------------------------------------------------------------------------- CSPD-03C 0.0 380.0 380.0 0.01 1.1 na na na Limestone 380.0 392.9 12.9 1.82 59.9 7.78 0.61 0.03 Manto-style sulfides 392.9 427.0 34.1 0.04 1.5 0.04 0.01 0.00 Limestone 427.0 432.0 5.0 na na na na na Void - mine working 432.0 434.6 2.6 3.48 69.4 9.50 0.46 0.05 Manto-style sulfides 434.6 543.0 108.4 0.37 4.5 0.38 0.04 0.01 Porphyry ------------------------------------------------------------------------- CSPD-04C 0.0 476.7 476.7 0.03 1.9 na na na Limestone 476.7 481.0 4.3 3.17 243.6 7.62 4.15 0.10 Manto-style sulfides 481.0 493.9 12.9 0.63 12.25 1.00 0.07 0.01 Manto-style sulfides 493.9 699.0 205.1 0.78 8.79 0.58 0.08 0.01 Porphyry - ----- ----- ----- ---- ---- ---- ---- ---- entire interval ---------- includes 493.9 573.0 79.1 1.24 13.31 1.08 0.11 0.01 Porphyry includes 573.0 699.0 126.0 0.50 5.95 0.27 0.06 0.01 Porphyry ------------------------------------------------------------------------- CSPD-05C 0.0 407.7 407.7 0.02 1.05 na na na Limestone 407.7 410.3 2.6 2.68 202.1 7.37 3.80 0.18 Manto-style sulfides 410.3 417.0 6.7 0.05 2.52 na na na Limestone 417.0 420.0 3.0 na na na na na Void - mine workings 420.0 429.5 9.5 0.06 6.57 na na na Limestone 429.5 432.0 2.5 na na na na na Void - mine workings 432.0 483.9 51.9 2.08 131.8 6.14 2.01 0.03 Manto-style sulfides 483.9 648.0 164.1 0.62 13.2 0.49 0.15 0.01 Porphyry 648.0 688.0 40.0 0.14 1.51 na na na Limestone 688.0 713.0 25.0 0.10 0.60 0.01 0.00 0.01 Porphyry ------------------------------------------------------------------------- CSPD-06C 0.0 386.2 386.2 Analyses Pending Limestone 386.2 500.0 113.8 Analyses Pending Porphyry ------------------------------------------------------------------------- CSPD-07C In progress Analyses Pending ------------------------------------------------------------------------- CSPD-08C 0.0 357.0 357.0 Analyses Pending Limestone 357.0 359.2 2.2 Analyses Pending Manto-style sulfides 359.2 522.0 162.8 Analyses Pending Porphyry ------------------------------------------------------------------------- Note: 'na' indicates no analysis performed for interval ------------------------------------------------------------------------- Amapari Mineral Resources Updated mineral resource statements for the Amapari mine, as of December 31, 2008, are presented in the table below: ------------------------------------------------------------------------- Amapari Mineral Resource Statement as of December 31, 2008 (1),(2),(3),(4) ------------------------------------------------------------------------- Metal Grade Contained Metal ------------------------------------------------------------------------- Tonnes 000's Gold g/t Gold Koz ------------------------------------------------ Measured 8,700 1.03 288 Indicated 14,249 1.85 848 ------ ---- --- Total M&I 22,949 1.54 1,136 Inferred 13,716 2.37 1,045 ------------------------------------------------------------------------- Notes to the mineral resource statements are provided in a separate table below. ------------------------------------------------------------------------- The Qualified Person as defined under Canadian NI 43-101 responsible for the preparation of the Amapari Mineral Resource Statement is Mr. Rex Berthelsen, Member AusIMM and Principal Geologist for New Gold Inc. ------------------------------------------------------------------------- Notes to Mineral Reserve & Resource Statements ------------------------------------------------------------------------- 1) Mineral resources for the Amapari mine have been estimated using industry standard three-dimensional geostatistical block model estimation methods (e.g. one or a combination of ordinary kriging, multiple indicator kriging or inverse distance to an exponential power) constrained by geological and metal grade domains in accordance with the standards of the Canadian Institute of Mining, Metallurgy and Petroleum and National Instrument 43-101, or the AusIMM JORC equivalent. ------------------------------------------------------------------------- 2) Amapari mineral resources have been estimated based on a gold price of US$750/oz and a variable lower grade cut-offs ranging from 0.6 g/t to 0.8 g/t gold for open pit oxide and sulphide resources and 1.7 g/t gold for underground sulphide resources that vary between individual mineral resources and their proximity to the Amapari operation processing facility. ------------------------------------------------------------------------- 3) Inferred mineral resources are not known with the same degree of certainty as measured and indicated resources, do not have demonstrated economic viability, and are exclusive of mineral reserves. ------------------------------------------------------------------------- 4) Numbers may not add due to rounding. -------------------------------------------------------------------------

For further information:

For further information: Mélanie Hennessey, Vice President Investor
Relations, New Gold Inc., Direct: (604) 639-0022, Toll-free: (888) 315-9715,
Email: info@newgold.com, Website: www.newgold.com


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