Canaco Resources Ltd. Acquires Gold Project.

WEST VANCOUVER, British Columbia--(BUSINESS WIRE)--Feb. 24, 1999--J. Malcolm Bell, President, is pleased to report that Canaco Resources Ltd. has acquired, by staking, a 100% interest in 83 contiguous claims adjacent to and surrounding Noranda's former Deer Cove mesothermal lode gold deposit located in the north central portion of the Baie Verte Peninsula, Newfoundland.

The claims, now named the Devil's Cove Property, are host to innumerable till, soil and bedrock geochemical anomalies, including the Fox Showing which reported grab samples of 26.8 g/t Au, 14.3 g/t Au and channel samples of 6.8 g/t Au over 3.0 m and 14.5 g/t Au over 1.0 m (Gower, 1988). The samples were taken from intensely talc-magnesite altered ultramafics with abundant carbonate-talc-quartz veins hosting pyrite-chalcopyrite-bornite mineralization and visible gold locally. Noranda reported that the Devil's Cove property demonstrates strong potential for the discovery of a mesothermal quartz-breccia vein and/or altered wall rock style gold deposit

Locally, the property is underlain by rocks of the Point Rousse Ophiolite Complex which also host the Pine Cove and Stog'er Tight gold deposits located immediately to the south. The property is transected by a 6.5 km long 060 degree trending regional structure known as the Green Cove Lineament. Noranda constructed a regional grid covering the entire length of the lineament which revealed several multi-line and multi-station gold in soil anomalies with individual values as high as 6000 ppb gold reported. An extensive till survey was also conducted over the property and abundant fresh near-source gold grains were obtained. Individual till anomalies up to 19,000 ppb Au were reported. Many of the anomalous soils and tills are associated with splays of the Green Cove Lineament and have yet to be evaluated.

Prior to the recent staking by Canaco, the whole property, as held by Noranda, consisted of over 98 claims. However, under the Mineral Act, the Newfoundland Government on December 24th, 1998 created an "EML" (Exempt Mineral Land) consisting of a 10 claim area in the centre of the play, to protect the underground development at the main zone as well as a potential world-class talc deposit formed nearby. A "Request for Proposals" will eventually be tendered allowing Canaco to submit a bid to acquire, evaluate and potentially develop the Deer Cove deposit where spectacular gold mineralization was discovered in 1986 by Noranda prospectors. The main zone consists of a brecciated vein system with an aggregate strike length of 500 m and remains open down-dip and a long strike to the north.

This acquisition is in keeping with the company's newly formed strategic operating plan which is committed to the acquisition and advancement of gold projects. Concurrent with this new policy, the company is negotiating an agreement for the acquisition of an advanced stage project where surface and underground exploration has demonstrated the potential for high grade gold resources amenable to an immediate feasibility study.