New Island Resources Inc. (TSXV:NIS) of St. John’s, NL is pleased to report that a drilling program has now commenced on its 2816 hectare Pine Cove property near Baie Verte, Newfoundland.

The drilling is being undertaken by Anaconda Gold Corp. (TSXV:ANX) which has an option to acquire up to a 60% interest by updating a feasibility study, arranging the financing, and bringing the property into production.

Anaconda reports (see Anaconda’s release of December 1) that the first phase 1500 meter drilling program will focus on enhancing the reserves and resources of the Pine Cove deposit by:

· Further defining the east and west limits of the deposit which remain open
· In fill specific blocks in the deposit in order to bring them up to proven and feasible reserve categories, and
· Test exploration potential of the new Pasture Pond zone located approximately 100 meters north of the deposit. Success at Pasture Pond would allow any reserves outlined to be added to the current Pine Cove reserve and open pit mine plan.

Upon completion of the drill program, Anaconda will complete a new reserve study which will be a key component of a new feasibility and mine plan study.

The Pine Cove deposit, known as Thunder and Lightening, was discovered in 1988 and has had 12,500 meters of drilling completed. A feasibility study was completed in 1993 and reviewed by mining consultants, Watts, Griffis and McOuat indicating a mineable gold reserve totaling 217,000 oz. Although these reserve calculations were not completed in accordance with National Instrument 43-101 standards, management believes these historical results to be reliable and relevant.

Apart from the Pine Cove property, New Island Resources Inc. owns a 100% interest in the Glover Island property in Western Newfoundland where it recently completed a successful drilling program on the Lunch Pond South Extension Zone, one of several identified zones on the property. This LPSE zone consists of multiple gold mineralized felsite sheets and has major dimensions. The recent drilling confirms minimum dimensions of 1350 m strike length, 215 m down dip extension and gold mineralization within zone up to at least 30 m thick, giving an inferred resource in the 15 million tonne range. The company is now finalizing a detailed compilation of its current and past exploration results prior to commencing a follow-up winter drilling program.

For further information, please contact:

Harold Wareham, President, Telephone: (709) 576-7711   Fax: (709) 576-2236 Email: info@newislandresources.com www.newislandresources.com

Statements contained in this release that are not historical facts are forward-looking statements, which involve known and unknown risks and uncertainties not under the company's control, which may cause actual results, performance or achievements of the company to be materially different from the results, performance or expectations implied by these forward-looking statements .