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Continental Gold Reports Further Drilling Results from Buritica Gold Project in Colombia

Continental Gold Ltd. (TSX:CNL)(OTCBB:CGOOF) has announced further diamond drilling results from the Yaragua and Veta Sur Systems at its Buritica gold project in Antioquia, Colombia.

To date, 45,000 metres of diamond drilling have been completed on the property as part of a program which will include an additional minimum of 60,000 metres in 2011.

Highlights

  • Among multiple vein and breccia intercepts, drill-holes BUUY-48 and BUUY-51 in the Yaragua System cut 3.5 m @ 76.72 g/t gold and 216.4 g/t silver and 2.7 m @ 60.53 g/t gold and 55.0 g/t silver, respectively
  • An intercept of 126.9 g/t gold and 92.0 g/t silver over 0.4 m in BUUY -46 is the deepest mineralization drilled to date at Buritica and represents a newly discovered vein system
  • The mineralized intersections in the Yaragua System extend the high grade vein system to over 500 metres along strike and 550 vertical metres. The Yaragua System remains open along strike to the west and at depth
  • BUUY-44 intersected 9.8 m @ 13.93 g/t gold and 69.6 g/t silver in the Murcielagos family of veins in eastern portion of Yaragua
  • Hole BUUY-130 cut 9.9 m @ 53.11 g/t gold and 109.9 g/t silver in the Veta Sur System approximately 35 metres above the previously reported bonanza grade intersections in holes Busy-79 (14.3 m @ 446 g/t Au and 166 g/t Ag) and Busy-131 (17.9 m @ 113.8 g/t Au and 112.4 g/t Ag), extending the central high grade core of this system

Details

Continental Gold's 100%-owned, 18,000-hectare Buritica gold project in Colombia is characterized by widespread, high-grade gold mineralization in multiple vein packages as well as extensive gold-in-soil anomalies. Drilling to date has focused on the Yaragua and Veta Sur vein systems where a mix of infill and step-out drilling has defined 17 individual veins along 550 metres of strike at Yaragua and 400 metres of strike at Veta Sur, both of which are open along strike to the west and at depth.

Total surface and underground diamond drilling on the property since its discovery in 2008 is over 45,000 metres. The 2011 drilling program will begin with eight diamond drills totaling a minimum of 60,000 metres.

Yaragua System

The Yaragua System consists of numerous semi-parallel, steeply-dipping base metal- carbonate type gold veins that occur within a 150-metre wide structural corridor over 500 metres of strike length and open to the west. Surface and underground drilling has tested up to 500 vertical metres of the system and the veins are open below this depth, some at bonanza grades.

BUUY-44, an oblique drill-hole, intersected substantial mineralized widths in the eastern part of the Yaragua corridor. These intersections appear to correlate with high grade sampling of a vein of the Murcielagos family or Vein B along about 90 metres on Level 3, some 60 metres to the east and 50 metres higher than the BUUY-44 intercepts, demonstrating a robust, potentially mineable vein in this area.

Similarly, BUUY-46 was drilled at a steep angle to the southeast, testing the depth extension of mineralization in the western portion of Yaragua. It encountered several veins including the deepest mineralization seen to date on the property at elevations of 1110 - 1150 metres, more than 550 metres below the highest known Yaragua mineralization. The 126 g/t Au intercept indicates that the Yaragua system may generate high grades over substantial vertical extents, typical of world-class carbonate-base metal vein systems. The deep intercepts in BUSY-46 are to the south of the Murcielagos vein family and represent a newly discovered vein system.

BUUY-47 through 51 were drilled on a single fence to test the western portion of the Yaragua vein family. All of the holes intersected multiple veins, including 3.50m @ 76.72 g/t gold with 216 g/t silver and 2.70m @ 60.53 g/t gold with 55 g/t silver on the San Antonio Vein or Vein C subzones. These intercepts were the deepest to date in these subzones and extended the vertical extent of high grade gold grade to over 350 metres. Moreover, the Yaragua breccia intercepts in each of the drill holes exhibited multiple intervals of lower grade (2-3 g/t gold) mineralization.

All intersections on this fence of drill holes were within or to the west of the north-south trending Diatreme Fault zone and confirm that the vein package is open to west of the fault zone. New underground development is planned for early 2011 to provide drill platforms for testing the veins along this new western extension.

Veta Sur System

Drilling continued on the Veta Sur family of veins which has been intersected along 400- metres of strike length to a maximum depth of 350 metres (1300 metre elevation). The Veta Sur System is open to the west and at depth. This intersection is on the same section approximately 35 metres vertically above the previously reported bonanza grade gold intersections in holes Busy-79 and 131. Infill drilling on a 25-metre grid and step-out drilling continue on the Veta Sur system and a large amount of additional data will be reported in the coming weeks.

"Our Company has made significant progress since listing on the TSX in April of this year," commented Ari Sussman, President and CEO of Continental Gold Ltd. "The mineralized systems at Buritica continue to grow both laterally and vertically. The high-grade intercept in BUUY 46 validates our plan to begin construction of a production scale ramp at the valley floor in 2011. The underground access from the ramp will enable the Company to drill test the vertical extent of Buritica up to 1000 metres."

Technical Information

The results of the Company's drilling program have been reviewed, verified and compiled by Vice President Exploration, Stuart Moller P.Geol., a qualified person for the purpose of NI 43-101. Mr. Moller has over 30 years of mineral exploration experience and is a Licensed Professional Geologist in the Province of British Colombia and a Fellow of the Society of Exploration Geologists.

The company utilizes an industry-standard QA/QC program. HQ and NQ diamond drill-core is sawn in half with one half shipped to a sample preparation lab in Medellín run by SGS Colombia. Samples are then shipped for analysis to SGS certified assay laboratory in Lima, Peru. The remainder of the core is stored in a secured storage facility for future assay verification. Blanks, duplicates and certified reference standards are inserted into the sample stream to monitor laboratory performance and a portion of the samples are periodically check assayed at ACME laboratories in Vancouver and/or Inspectorate Labs in Reno.

Source: Continental Gold Ltd.

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