Newstrike Announces Diamond Drilling Exploration Work on Horseshoe Lake Property

TORONTO, ONTARIO--(Marketwire - June 2, 2011) - Newstrike Resources Ltd. (TSX VENTURE:NR) ("Newstrike") announces that it is party to a binding letter of intent dated October 13, 2010, with Mr. Gerhard Meyer pursuant to which the parties have set out the proposed terms governing the grant to Newstrike of an option to earn a 100% interest in the property known as the Horseshoe Lake property located in Mitchell and Bowerman Townships, Ontario. The property is composed of two claim groups. Twenty-seven (27) mining claims/units and four (4) mining claims (8 units). Pursuant to the letter of intent, Newstrike would earn its 100% interest by making aggregate cash payments of $200,000 and incurring exploration expenditures on the property in the aggregate amount of $500,000, each over a three-year period, together with a further $250,000 payment to be made with three months of a positive feasibility study. Newstrike's interest in the property would be subject to either (i) a 1.5% gross overriding royalty on metal sales from the property, and a 0.75% gross overriding royalty on metal sales from any properties acquired subsequently within a specified area of interest; or (ii) a 2.5% net smelter return royalty on the property, and a 1.0% net smelter return royalty on any properties acquired subsequently within a specified area of interest, each subject to certain redemption options available to Newstrike.

The Horseshoe Lake property is located between the South Bay Mine (past producer), 9.5 km to the NNE and the recently discovered Arrow Lake deposit, 5.0 km to the SW. The South Bay Mine produced 1.6 million tons of ore grading 14.7% Zn, 2.3% Cu and 120 g/t Ag. The Arrow Lake deposit contains an estimated NI 43-101 indicated resource of 2,030,000 tonnes grading 5.92% Zn, 0.75% Cu, 21.1 g/t Ag% 0.58 g/t Au.

Newstrike completed an airborne VTEM geophysical survey on the property. The total area coverage was 11km² with total survey line coverage of 254.4 line kilometers. The principal sensors included a Time Domain EM system and a magnetometer.

Exploration

Based on the geophysical results, a number of interesting EM anomalies that were identified across the property. The magnetic results also contain worthwhile information in support of exploration targets of interest. A diamond drilling program of three holes to test targets will be carried out.

About Newstrike

Newstrike is an early stage gold exploration company with property assets located primarily in the Kirkland Lake area of Ontario. Newstrike owns a 50% interest in the Commodore property and a 25% interest in the Swansea property. Newstrike's strategy is to carry out exploration on their advanced properties with the purpose of defining economic deposits.

Forward Looking Statements – Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of Newstrike, including, but not limited to the impact of general economic conditions, industry conditions, volatility of commodity prices, risks associated with mineral exploration and mining activities, currency fluctuations, dependence upon regulatory approvals, the availability of future financing and exploration risk. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.