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Empire Resources: New Gold Discoveries At Penny’s Find Enhance Underground Potential Below Open Pit

Empire Resources (ASX: ERL) has received assays from a recent reverse circulation drilling campaign that show the potential for an increase in gold ounces.

All four holes drilled recently intersected quartz veining with the gold mineralisation.

Highlight intersections are 6 metres at 13.34 grams per tonne (g/t) gold from 113 metres including 4 metres at 19.43g/t, 8 metres at 4.02g/t gold from 100 metres including 2 metres at 12.95g/t, and 3 metres at 14.42g/t gold from 143 metres.

David Sargeant, managing director, commented on the positive results:

"These high grade gold intersections confirm the potential for Penny's Find to host an underground operation beneath an open pit.

"I'm extremely confident further drilling will substantially increase the resource ounces leading to the development of a mining operation.

"The proximity of this deposit to Kalgoorlie, the current high gold price and the possibility of mining a substantial portion of the deposit by open pit methods, also confirms the value of this resource".

Further upside to the new gold results is that a new hanging wall lode was discovered from an intersection of 16 metres at 2.34g/t from 20 metres.

Importantly, this is the first indication that there may be a second mineralised lode at Penny's Find.

This shallow mineralisation currently remains open along strike to the southeast

Penny's Find has a JORC Resource of 314,000 tonnes at 5.2g/t for 52,500 gold ounces, down to a vertical depth of 150 metres.

Earlier metallurgical test work has shown both oxide and fresh mineralisation to be free milling with a high gravity recoverable gold component of greater than 60% and a total gold recovery of above 96%.

Penny's Find Sale Agreement

In September 2010 Empire entered into a staged sale agreement with unlisted company Brimstone Resources, which plans to bring Penny's Find into production.

The terms of the agreement were recently revised, with the sale price for a 100% interest in the project increasing to $3 million from $2 million.

Importantly, the revised agreement allows Brimstone more time to devote to the project, while Empire will benefit from either an extra $1 million, for a total of $3 million, in the event of a full sale or an additional 5% interest to 25% interest in the event of a partial sale.