Moydow Mines fka MOY

[Ed Monton]

Cornerstone and Moydow Announce
True Grit Phase II Drilling
August 27, 2003

Mount Pearl, Newfoundland & Labrador: Cornerstone Capital Resources Inc. (TSXV - CGP) and joint venture partner Moydow Mines International Inc. (TSE - MOY) are pleased to announce plans for Phase II drilling on the True Grit Gold Project in south-central Newfoundland.

This first phase of drilling comprised a 1,251-meter, 22 hole diamond drilling program. The best intersection was obtained in hole TG4, which returned 0.6 g/t Au over 117 m including a 26 m wide section grading 0.83 g/t Au. Intersections ranging from 16 to 46 m wide with grades of 0.45 to 0.75 g/t Au were encountered in holes TG3, 11, 12, 22 and 23. An area of approximately 700 m by 200 m, occurring within a 2600 m by 800 m coincident gold-arsenic-antimony soil geochemical anomaly, was drill tested to depths of between 120 and 35 m vertically.

The Phase II drilling program will total approximately 1300 m and is designed to test mineralization encountered in Phase I at depth and along strike as well as test other targets occurring within the 2600 m by 800 m coincident gold-arsenic-antimony soil geochemical anomaly. The drilling contract has been awarded to New Valley Drilling of Springdale, Newfoundland and will commence immediately.

The True Grit property, originally comprising 356 claims, has been enlarged to 535 claims covering 134 sq. km. by way of additional claim staking by Cornerstone and Moydow.

The agreement with Moydow Mines on the True Grit Property is one of eight joint venture agreements Cornerstone now has in place, including seven gold projects and one VMS project.

The Company announces a "Shares for Debt" Private Placement in the amount of $18,501.12 whereby 41,576 Common Shares will be issued or reserved for issuance at a price of $0.445 per share. The Corporation has met all the conditions and closing is conditional on the approval by the TSX Venture Exchange.

On Behalf of the Board of Directors
Glen H. McKay
President

Further information is available on the Cornerstone Web site at www.cornerstoneresources.com, via e-mail at [e-mail], or by calling 1-877-277-8377.