Callinan Options Island Lake Claims and Plans Exploration Program

    VANCOUVER, Sept. 3 /CNW/ - Callinan is pleased to announce that it has
recently entered into an option agreement to earn an interest in 32 mineral
claims comprising 5,303 hectares in the Island Lake area of East-Central
Manitoba. The Island Lake property hosts several known gold occurrences,
including historical drill holes with values of up to 28.3 grams per tonne of
gold. Other historic work includes a 70 ton bulk sample mined by Island Lake
Gold Mines in 1934 from two pits on the property, from which 47.25 oz of gold
was recovered. The property is located on the same system of shears, faults
and splays as the previously producing Island Lake Gold Mine operated by
Island Lake Gold Mines Limited, according to assessment work filed with the
Manitoba government.
    "Great gold mines are often found near or under old gold mines," said
Callinan President Mike Muzylowski. "Our Island Lake property has a
significant mineralized system that has produced gold with good grades. The
work done by previous operators, including diamond drilling, trenching and
bulk samples, consistently produced gold grades of multiple grams per ton and
associated silver values. This gives us a good indication that, with modern
geophysical and drilling techniques, we may be able to uncover value in this
shear zone."
    Induced polarization work done by previous operators has located
anomalies as large as 100 by 50 meters, and 140 by 15 meters with coincident
gold values. These anomalies remain un-tested.
    All assay values and grades referenced at the Island Lake property have
been sourced from records of work of previous operators filed with the
Manitoba Government. As the work was conducted prior to the implementation of
NI 43-101, and Callinan has not been able to verify the methods used and the
quality assurance and controls, if any, these early results are disclosed for
information purposes only, may not be relevant and should not be relied upon.
    Callinan plans to drill test targets in the Island Lake area as part of a
winter 2009-2010 drilling program and has budgeted $500,000 for the drilling
program. Callinan currently has $11.8M in cash, and continues to receive
income from its net profits and royalty interests in the 777 Mine in Flin
Flon, Manitoba.
    The Island Lake property has been optioned under an option agreement with
W.S. Ferreira Ltd. and William Ferreira. The agreement gives Callinan the
right to earn an 80% interest in and to the Island Lake claims for initial
consideration of $20,000 and the issuance of 50,000 common shares in its
capital to W.S .Ferreira Ltd., upon regulatory approval. Callinan will
continue to make payments of cash and shares on the anniversary of regulatory
approval of the agreement in each of the next three years if the company
wishes to continue to earn its interest. Should Callinan elect to exercise the
option and acquire the 80% interest, the Company will have issued a further
350,000 common shares and made further cash payments of $380,000 and expended
$1,900,000 on the exploration of the property over the three year time period.
Upon exercise of the option, the claims will be subject to a 2% net smelter
return royalty to W.S. Ferreira Ltd., with 50% of this royalty purchasable by
Callinan for a total payment of $1,000,000. The option agreement is subject to
regulatory approval.
    Callinan's exploration programs are being conducted under the supervision
of P.J. DeVeaux, a qualified person as defined by National Instrument 43-101
who has reviewed and approved the contents of this news announcement.

    Mike Muzylowski

    Mike Muzylowski
    President and CEO

    Neither TSX Venture Exchange nor its Regulation Services Provider (as
    that term is defined in the policies of the TSX Venture Exchange) accepts
    responsibility for the adequacy or accuracy of this release.

    Some statements in this news release contain forward-looking information.
These statements include, but are not limited to, statements with respect to
future expenditures. These statements address future events and conditions
and, as such, involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements to be
materially different from any future results, performance or achievements
expressed or implied by the statements. Such factors include, among others,
the ability to complete contemplated private placements and the timing and
amount of expenditures. Callinan does not assume the obligation to update any
forward-looking statement.

For further information:

For further information: Braden Maccke, 736 Granville Street, Suite
1100, Vancouver, BC, V6Z 1G3, Telephone: (604) 605-0885, Toll-Free:
1-877-228-5210, Fax: (604) 605-0886, Email:, Website:

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