Pine Cove

Exploration and Resource Overview

The Pine Cove gold property is located near the town of Baie Verte in Northwest Newfoundland.  It comprises 659.7 hectares held under a mining lease.

The property contains the Pine Cove deposit (Thunder and Lightening Zones) which was discovered in 1988 and had 12,540 metres of drilling completed thereon.

In 2003, an option agreement was signed with Anaconda Mining Inc. (Anaconda) whereby Anaconda can obtain a 60% interest in the property and operator status by completing a feasibility study by December 31, 2004, making a production decision, arranging the financing, and bringing the property into commercial operation.

A technical report and feasibility study was undertaken by A.C.A. Howe International Limited and completed March 18, 2005.  Using a cut-off grade of 0.80 grams per tonne, this report shows an indicated resource of 209,543 ounces from 2,216,081 tonnes at a grade of 2.94 grams per tonne and an inferred resource of 59,192 ounces from 837,226 tonnes grading 2.20 grams per tonne.

Based on this feasibility study, Anaconda made a production decision to bring the deposit into commercial operation in 2007.  The full technical report and feasibility study can be viewed at www.sedar.com

In 2008 Anaconda completed the construction of a 500 ton per day mill at Pine Cove. The mill has incurred operating problems which has prevented it from attaining commercial operation. As such certain design deficiencies have been identified and corrective action is being undertaken to achieve commercial production in early 2010.

The property is highly prospective for additional reserves adjacent to and outside the main deposit.  These include the Romeo and Juliet Zone some 1500 metres north of the deposit.  This zone is a classic mesothermal quartz-carbonate vein where high-grade mineralization has assayed up to 376 grams per tonne and a small bulk sample taken in 1998 assayed over one ounce per ton.  While these figures predate and are non-compliant with NI 43-101, New Island believes they indicate the potential for further discoveries.