Armistice Resources Corp. bulk sampling update

    Issued and Outstanding common shares: 60,130,435

    TORONTO, Aug. 21 /CNW/ - Armistice Resources Corp. (TSX: AZ) ("Armistice"
or the "Corporation") is pleased to announce interim results from the bulk
sampling of two gold zones on the 2250-foot level at the McGarry Project
located at Virginiatown, Ontario.
    Todd J. Morgan, Armistice President and CEO, said "we are very pleased
with the results from our bulk sampling." He added, "the results particularly
illustrate the potential of the project once we have identified the best
mining method."
    One zone is the 140N Zone located 140 ft. north of the shaft and centred
on the 00 east section. The other is the 260N Zone located 260 ft. north on
the mine grid and centred on the 600 west section. The 140N Zone is a new
discovery from the current work programme and the 260N Zone was partially
identified from previous work in the 1990's.
    These two zones are typical of the two dominant styles of gold
mineralization known in the adjacent former Kerr Mine. The 140N Zone is
dominated by pyrite mineralization within a silicified, pyrite-rich mudstone.
The 260N Zone is in a volcanic/mudstone unit highly altered by carbonates and
silicates with some pyrite. Visible gold has been noted in both of these
    Erik Andersen, Vice President and COO noted "the sampling is particularly
encouraging in connection with results from previous drilling programs. We
continue to encounter economic grade zones that were not necessarily indicated
in drill core."
    In both cases, the mineralized zones have been undercut on the 2250 level
by development mining. One objective of the current work is to test a mining
method that could be applied to normal stope development in future production
plans. Two 8 ft. lifts above the development drift are planned for each zone.
Test mining of the 140N Zone stope is nearly complete and mining of the first
lift of the 260N Zone has started. The 140N Zone is approximately 100 ft long
and 6 to 8 ft wide with dips to the south at about 85degrees. The 260N Zone is
also about 100 ft long with widths between 8 and 12 ft and a steep dip.
    Another important objective of the bulk sampling programme is to obtain a
fully diluted grade estimate of the mined material for comparison with chip
sampling as routinely taken during normal production mining. Samples consist
of drift rounds or slash rounds varying from about 25 to 75 tons. Each sample
is processed through a crusher on surface which reduces the mined rock to
5/8 inch in size or smaller. A custom built, continuous sampling device
extracts approximately one 45 gallon drum of crushed rock from each sample.
The drums of crushed rock are shipped to PolyMet Laboratories in Cobalt,
Ontario for processing. On average, a drum of crushed rock is about 0.5% of
the total weight of the rock processed per sample. For a more detailed
description of the PolyMet circuit, please see
    Development mining undercutting the 140N Zone is included in the current
bulk sampling programme. From mining activity on the 2250 Level, a total of
34 bulk samples have been collected to date. Of these, 10 have been from areas
with the potential for stope development. The other 24 have been from areas on
the margins of identified gold zones or from development mining along expected
low-grade portions of potential gold structures. Of the 10 samples from areas
with potential for stope development, results have been received for seven.
    Of the 7 bulk samples referenced above, 5 were from this 140N undercut
area. The average weighted bulk sample grade from the PolyMet results was
0.15 oz/t from 280 tons of material. Based on the routine chip sampling cut to
1.0 oz/t and diluted with 30% material grading 0.02 oz/t, the estimated grade
for the 5 bulk samples was 0.15 oz/t. This dilution factor is reasonable
considering that there is observed irregular boundaries to the mineralized
geology giving internal dilution that is difficult to fully represent in the
routine chip sampling. In addition, there is a local geological situation in
the 140N test stope causing mining rounds to break to natural slips bounding
the mineralized unit. The corresponding uncut and undiluted average grade from
the chip samples taken in the 140 N zone was 0.23 oz/t (cut to 1.0 oz/t, the
undiluted chip sample grade was 0.21 oz/t).
    The other objective of the current work programme is to gain mining
experience so that stoping procedures can be continuously improved to reduce
dilution and optimize the mined grade. While the number of samples involved in
the above analysis is small, they do indicate that any mining method proposed
for the McGarry project must have a strong focus on being able to control
dilution. The bulk sampling results from the material from the first two lifts
above the base level will be important for further evaluation of efficient
mining methods. In order to minimize stope development investment, the test
mining is focussing on strategies that will minimize waste development.
    A similar initial analysis for the 260N Zone cannot be made since the
undercut mining was originally done in the mid 1990's. The bulk sampling
results from the two planned lifts of test stoping will therefore be important
in evaluating the mining issues for the carbonate style of mineralization.
    The 140N Zone was identified from a single drill hole with an
intersection of 7.7 ft grading 0.11 oz/t. Similarly, the 260 Zone was
identified from a single drill hole with an intersection of 7.4 ft grading
0.41 oz/t. This illustrates the importance of placing even single drill hole
intersections into a geological context as the basis for the development of
stopes. Primary drill spacing is at 100 ft centres at the 2250 level. A small
highly portable drill is now in operation to conduct detailed investigations
around identified targets.
    The work reported on in this press release is supervised by Erik
Andersen, P.Eng., Vice President and COO of Armistice and Qualified Person.
Mr. Andersen has reviewed and approved this release.

    Armistice is a Canadian exploration company that owns the McGarry project
in North-eastern Ontario located on the prolific Larder Lake break. The
McGarry project is an advanced exploration underground gold project consisting
of 34 contiguous patented mining claims and licences of occupation totaling
484 hectares which adjoins the former producing Kerr Addison gold mine which
produced in excess of 11 million ounces of gold.


SOURCES CORP. "Todd J. Morgan" Todd J. Morgan President, CEO and Chairman of the Board

For further information:

For further information: Todd J. Morgan, (705) 567-4567,

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