May 28th, 2008 - Vancouver, B.C.: Gold Star Resources Corp. (the "Company") (GXX - TSX.v) is pleased to announce the
acquisition, subject to TSX Venture Exchange approval, of the Coronation Sulphur Project, Alberta. The Coronation Sulphur Project consists of applications to lease Metallic and Industrial Minerals that have been filed with the Government of Alberta. The cumulative area covered by the lease applications filed consists of approximately 60,000 hectares located approximately 120 km's south of Edmonton, Alberta. The Company is continuing negotiations with the Vendors for the acquisition of additional properties.
The Project: The following information was extracted form reports published by the SME (Society for Mining, Metallurgy, & Exploration) at their Annual Meeting & Exhibit dated February 1992.
Readers should note that the following information on historic work performed on the property was done prior to implementation of NI43-101, therefore the results spoken of do not comply with modern reporting standards and should not be relied upon until such time as additional work is completed on the property, including preparation of an NI43-101 report.
(The Brownless and Halkow estimate of US$105 million of recoverable Sulphur, based on pricing of US $25 / ton, constitutes estimated recoverable Sulphur of 4.2 million tons per section of land [640 acres]. The currently quoted price for Sulphur is CA $650 / tonne [CA $591 / ton]).
These historic estimated values and current estimated values should not be relied upon as relevant without the support of a current feasibility study.
Sulphur, an essential element primarily used to produce sulphuric acid, is an essential element used in the production of many basic global products including the production of Diammonium Phosphate or DAP, a common fertilizer. As the demand for food production increases to meet the needs of growing economies in heavily populated portions of the world, in particular Asia, the use of fertilizers to strengthen plant growth and increase crop production is also growing. With the increased demand for fertilizer and components necessary for the production of fertilizer, Sulphur, long relegated to by-product status, is now gaining attention to meet today's increased demand. Following other agricultural product demands world wide, Sulphur has seen dramatic increases in both demand and pricing, having risen from $50 per tonne to $650 per tonne in the past 15 months.
Currently, the major source of Sulphur has come from extraction from oil and gas production as a byproduct. In limited circumstances, Sulphur is found as a native mineral in deposit form, where modern mining methods such as in-situ recovery ("ISR") can be utilized to extract the Sulphur, while minimizing the footprint associated with this type of mining.
The Agreement: Cost of the acquisition of the Coronation
Property project, acquired from arms-length vendors, includes payment of a total of $315,000 and issuance of 1,200,000 shares of the Company as follows:
$45,000 payable upon signing;
300,000 shares upon the earlier of Exchange approval, or 90 days after execution of this agreement;
$60,000 and 300,000 shares due six months after Exchange approval;
$90,000 and 300,000 shares due 18 months after Exchange approval; and
$120,000 and 300,000 shares due 24 months after Exchange approval.
The Vendors will retain a 2% Net Smelter Royalty, 50% of which can be purchased from the Vendor for the sum of $2,000,000 at any time after commencement of commercial production as defined in the agreement. A finders fee may be payable on the acquisition as per TSX Venture Exchange regulations.
On Behalf of the Board,
"Patrick Morris"
Patrick Morris, President and CEO
THE BOARD OF THE TSX VENTURE EXCHANGE (ALSO KNOWN AS THE NEX) HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
For further information, contact Patrick Morris, President and CEO of the Company at: Telephone: (604) 641-4450 Facsimile: (604) 669-9335