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Argonaut Gold Announces Drill Results from El Castillo Gold Mine, Mexico

Argonaut Gold Inc. (TSX:AR) has provided an update regarding its 2010 resource expansion drill program at its 100 percent owned El Castillo gold mine in the State of Durango, Mexico.

Following the successful Phase I drill program at El Castillo, Phase II of the drill program was initiated with two reverse circulation drill rigs. The Phase I drilling was positioned on approximately 100 meter centers and was designed to identify the extent of potential gold mineralization that expands to the south and east of the current El Castillo open-pit mining operation. Phase I encompassed 16,250 meters totaling 120 holes, and was completed in mid April.

Immediately thereafter, Phase II drilling commenced on approximately 50 meter spacing within mineralized areas identified by Phase I. Total drilling from both phases includes more than 35,000 meters spanning over 280 holes. Additional infill drilling results, similar to current pit grades, are anticipated to be added into a measured category of an updated 43-101 Technical Report, that is scheduled for completion by year's end.

Tom Burkhart, Vice President of Exploration for Argonaut Gold said "It's been exciting to be part of a successful drill program at El Castillo. Drilling results have increased the mineralized envelope by approximately 500 meters to the south and 400 meters to the east, representing almost a 100% increase in dimensions over the existing $625 pit. We'll continue to employ an RVC drill to further test the property potential at El Castillo as it remains open in several areas of interest."

Transition and Sulphide Ore

An ongoing priority for the Company is to evaluate the economics of transition and sulphide ore zones that underlie the oxide resource, as this material potentially represents a significant increase in ore tonnages for the El Castillo operation. The company has committed to additional metallurgical testing with Kappes Cassidy Associates of Reno to assess the following:

Phase I - Metallurgical testing of bulk samples from the mine.

Phase II - Evaluation of the transition and sulphide ores. A 1,000 meter core drilling program is currently in progress to provide transition and sulfide samples for further metallurgical studies. The new transition and sulphide material will be assessed to evaluate the recoveries.

Tom Burkhart, Vice President of Exploration for Argonaut commented, "We look forward to seeing how a new National Instrument 43-101 compliant technical report will impact the production profile and life of mine at El Castillo when we incorporate results from drilling through September as well as metallurgical work, new operating costs and production improvements." In regards to Argonaut's overall exploration program, Tom added "We look forward to initiating a drill program at our La Fortuna Project in the 4th quarter."

Amalgamation of Argonaut Gold Inc.

Effective October 1, 2010 Argonaut Gold Ltd. has amalgamated with its wholly-owned subsidiary Argonaut Gold Inc. The Company will continue under the name Argonaut Gold Inc. as approved by shareholders at its last annual general meeting of shareholders.

Sale of Guatemala assets

Argonaut Gold has sold its 50% ownership of its closed El Sastre mine in Guatemala to its joint venture partner for $1.3 million. Argonaut Gold considered El Sastre a non-core asset.

Qualified Person Comments/Quality Control Procedures

All drill-hole samples were composited at site into 1.5 meter intervals and split with ¼ of the sample transported to ALS-Chemex's sample preparation lab in Zacatecas, Mexico. Pulps are prepared here and then sent to ALS-Chemex's Laboratories in Vancouver, Canada where gold assays are completed using a fire assay procedure with an Atomic Absorption Spectroscopy ("AAS") finish. Sixteen RVC drill holes were also selected for cyanide leach analysis with this work also completed by ALS Chemex at their Vancouver facility. The Company utilizes a system of check assays, sample duplicates and sample blanks consistent with industry standards.

Preparation of this press release was supervised by Thomas Burkhart, Argonaut Gold's Vice President of Exploration and a Qualified Person under National Instrument 43-101. Mr. Burkhart also reviewed the reverse circulation drill program and on-site sample preparation procedures at El Castillo.


Argonaut Gold Inc.

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