Golconda Resources Ltd.: Drilling Intersects Gold in Quartz-Adularia Vein Type Setting at South Monitor.

Business Editors

CALGARY, Alberta--(BUSINESS WIRE)--Oct. 20, 2003

South Monitor (80% interest)

Golconda Resources is pleased to announce that drilling on the South Monitor Property successfully intersected a quartz-adularia gold-vein system. Assay results show that drilling intersected the veins high in the system and there is excellent potential that they will turn into a high-grade Bonanza vein system below the level intersected by the drilling.

SM-03-3 intersected from 240-330 ft. multiple zones of silicification and stockwork veining with a quartz-adularia envelope. Adularia is a potassium feldspar which is found in hydrothermal systems and is often associated with very high gold-silver values. Thirty feet, from 250-280 ft. assayed 1 g/tonne gold and 13 g/tonne silver. The enveloping material contains about 0.5 g/tonne gold and 6 g/tonne silver.

SM-03-4 which is located about 300 ft. to the south intersected a different vein system from 240-380 ft., which also consisted of quartz-stockwork zones within a quartz adularia envelope. Two 10 ft. zones assayed 1 g/tonne gold. The surrounding material contains an average of 0.35 g/tonne gold. Silver averages 3.5 g/tonne over the entire 140 ft. interval. The only other anomalous metals are potassium and aluminium indicating a 30-35% adularia content.

The most striking feature of these two zones is the extreme depletion in other elements. For example, phosphorus which as fluorapatite occurs over top and to the sides of the high-grade part of the vein system averages 350 ppm for the 100 ft. overlying the vein zones, but average only 40 ppm within the zone.

Bonanza veins often start at surface carrying a trace or no gold. At depth that form thin vein-lets with 1-3 g/tonne gold and then at greater depth they, widen out and carry 1 oz/tonne gold or more and multiple ounces of silver in a quartz-adularia system. The chemistry in Golconda's two holes indicates that the boiling horizon, which can contain the high-grade gold and silver still lies below the drill intercepts. At Ivanhoe, which has a grade of 44.1 g/ton gold and 240 g/ton silver, the high grade starts at 500 ft. depth and at Midas, which has a grade of 38.4 g/tonne gold and 439.5 g/tonne silver the high grade starts at 850 ft. depth.

Hole SM-03-5 drilled 1500 ft. to the northwest encountered strong hydrothermal clay from 200-720 ft. depth. The clay shows anomalous gold arsenic and antimony values. A massive chalcedonic vein from 490-510 ft. contains just traces of gold but even higher arsenic (373 ppm) and antimony (105 ppm) values. This type of quartz vein has also been observed above the high-grade part of veins in other deposits.

In the next phase, diamond drilling will try to intercept these veins at greater depth. Holes SM-03-1 and 2 were drilled in the south-eastern part of the property towards the Monitor Flat claims and shows similar geochemistry.

Monitor Flat (100% interest)

In its initial drill program, Golconda was successful in outlining a large hydrothermal gold system.

The property, which lies on the gravel covered southern slope of the Monitor Range has about 1% outcrop, consisting of three small hills.

Four reverse circulation holes were drilled. MF-1 was drilled to a depth of 400 ft. It encountered 200 ft. of Tertiary tuff and 200 ft. of Palaeozoic-siltstone. Both rock types show hydrothermal alteration and quartz-stockwork veining. MF-2 located 3600 ft. (1100m) to the northwest (600 ft. deep) and MF-3 located another 1000 ft. (300 m) to the northwest (500 ft. deep) also showed hydrothermal alteration in Tertiary tuff. MF-4 (500 ft. deep) drilled to the east encountered thick overburden and unaltered tuff.

Assays show that the first three holes contain wide zones of anomalous gold values (between 10 and 80 ppb) arsenic (up to 250 ppm) antimony (up to 25 ppm) and barium (up to 3,500 ppm).

A strong correlation of elevated gold and elevated potassium (up to 7% potassium against a 2-3% background) together with the large extension (4,600 ft. plus) of the hydrothermal system makes this area highly prospective for blind ore-bodies. Potassic altered rock is less resistant to erosion and commonly forms covered slopes. For example, gold at Round Mountain (11 million ounces), a Walker Lane gold deposit, is primarily contained within potassic altered rock units and is not outcropping but occurs on the gravel covered slope of the Toguima Range.

Golconda will employ geochemical and geophysical methods in the next phase to try to outline the potassic altered zones which could contain substantial gold mineralization Golconda has increased its claim holdings from 540 acres (216 ha) to 1740 ac (696 ha).

ALS Chemex carried out the assaying and Guenter Liedtke is the acting Qualified Person under NI-43101 on these projects.

On behalf of Golconda Resources Ltd.

Guenter J. Liedtke, President

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