Gabriel Resources Ltd. - First quarter corporate and project update

TSX Trading Symbol: GBU

TORONTO, May 11 /CNW/ - Gabriel Resources Ltd. ("Gabriel") is pleased to
provide its first quarter update with respect to the development of its 80%
owned Rosia Montana and Bucium projects located in Western Romania.

Highlights
----------

-  $30 million in equity financing raised during the First Quarter

-  Alan R. Hill appointed as President & Chief Executive Officer

-  Richard Young appointed as Vice President and Chief Financial Officer

-  Terms of Reference for the Rosia Montana EIA expected shortly

-  Romania signs the Accession Treaty with the European Union

Corporate Developments
----------------------

    Financing Activities

During the first quarter, Gabriel completed an underwritten equity
offering (the "Offering"), consisting of 15,000,000 units of Gabriel (the
"Units") at a price of Cdn$2.00 per Unit, for aggregate gross proceeds to
Gabriel of Cdn$30 million. Each unit consisted of one common share of Gabriel
and one half of one common share purchase warrant. Each whole common share
purchase warrant entitles the holder to acquire one common share of Gabriel at
a price of Cdn$2.75 at any time on or before March 31, 2007 and the warrants
are listed and posted on the Toronto Stock Exchange under the symbol GBU.WT.
The net proceeds from the equity offering will be used by Gabriel to further
the development of the Rosia Montana project and for general corporate
purposes. At the end of the first quarter, Gabriel had cash resources of
approximately $39.8 million.
Newmont Mining Corporation of Canada Limited ("NMCCL"), a subsidiary of
Newmont Mining Corporation ("Newmont"), elected to participate in the Offering
by acquiring 2.5 million Units for an aggregate purchase price of
Cdn$5 million, all in accordance with the subscription agreement entered into
between Gabriel and NMCCL in August 2004, which contained other arrangements
which have been previously disclosed. As of March 31, 2005, Newmont holds
17.5 million common shares or 10.8% of the outstanding common shares following
completion of the Offering as well as 15 million warrants exercisable until
December 31, 2005 at a purchase price of Cdn$2.00 and 1.25 million warrants
exercisable on or before March 31, 2007 at a purchase price of Cdn$2.75. If
all warrants held by NMCCL were exercised, then NMCCL would hold 19.6% of
Gabriel's then issued and outstanding common shares.

    Appointment of Alan R. Hill as President and Chief Executive Officer

Alan R. Hill was appointed the President and Chief Executive Officer of
Gabriel on May 10, 2005 upon the retirement of Oyvind Hushovd as the Chief
Executive Officer. Mr. Hushovd continues as the Non-Executive Chairman of
Gabriel and Mr. Hill joined the Board of Directors. Prior to his retirement
from Barrick Gold Corporation in September 2003, Mr. Hill managed the
development of Barrick's four latest projects: Alto Chicama, Pascua, Veladero
and Cowal. In addition Mr. Hill managed the development of Barrick's
Goldstrike, Pierina and Bulyanhulu projects, with both Bulyanhulu and Pierina
being brought into production on schedule and under budget. Mr. Hill holds a
B.Sc. (Honors) Mining Engineering and a Post Graduate Degree in rock
mechanics.

    Appointment of Richard Young as Vice President and Chief Financial
    Officer

Richard Young was appointed a Vice President and the Chief Financial
Officer of Gabriel on May 10, 2005 upon the resignation of Paul Martin. Mr.
Young brings extensive financial, mine development and capital markets
experience to Gabriel, and during his 13 year career with Barrick Gold
Corporation, he gained extensive financial experience through a number of
financial positions within the finance group, as well as mine development
experience as Barrick developed their Goldstrike and Pierina Properties. Most
recently he served as Vice President of investor relations for Barrick, where
he was responsible for the development and execution of their investor
relations strategy. Mr. Young will also be assuming responsibility for
Gabriel's investor relations program with the resignation of Simon Lawrence,
the current Vice President Corporate Development.

    Election of Former Canadian Ambassador to Romania as Director of
    Gabriel

Mr. Raphael Girard, the former Canadian Ambassador to Romania from 2000
to 2003, was elected as a member of Gabriel's Board of Directors at Gabriel's
annual meeting of shareholders held on April 19, 2005. Prior to serving as
Canada's ambassador to Romania, Mr. Girard served as Canada's ambassador to
Yugoslavia.
Mr. Trevor Moss, Gabriel's Vice President Project Development, resigned
from Gabriel on April 5, 2005 for personal reasons.

Rosia Montana Project Development
---------------------------------

    Environmental Impact Assessment

Gabriel formally initiated the environmental permitting process for the
development of a new mine at the Rosia Montana project in December 2004 by
submitting the Project Presentation Report (the "PPR") to the Romanian
regulatory authorities. The PPR is a summary of the proposed development and
will be used by the Romanian authorities to determine whether or not an
environmental impact assessment (the "EIA") must be prepared. Given the scale
of the proposed development, Gabriel has assumed that an EIA will be required
for the Project.
Gabriel currently anticipates receiving the terms of reference shortly
and once received, Gabriel will finalize the current draft of the EIA and
arrange for its submission to the Romanian authorities for review, public
consultation, amendment and approval.

Bucium Project Development
--------------------------

    Preliminary Assessment Report

Roscoe Postle & Associates Inc. of Toronto is presently preparing a
preliminary assessment report (scoping study) in accordance with National
Instrument 43-101 for the Bucium project which is expected to be completed
during the summer.

Romania Signs Accession Treaty with European Union
--------------------------------------------------

On April 25, 2005 at a special ceremony held in the Grand Duchy of
Luxembourg, Romania signed the Treaty of Accession (the "Treaty") with the
European Union. The signing of the Treaty followed the vote of the European
Parliament on April 13, 2005 to approve the entry of Romania into the European
Union in 2007. The ceremony in Luxembourg marks the completion of a long
process of accession preparations and negotiations that was launched by the
European Council in Luxembourg in December 1997. Romania has made progress in
bringing their laws, regulatory frameworks and administrative processes into
line with those of the European Union and Romania must now focus on meeting
their commitments and undertakings to the European Union in order to complete
accession on January 1, 2007.
Romanian Prime Minister Traian Basescu, in his speech at the signing
ceremony, commented "For us, EU membership will represent the fulfillment of a
dream, more than half a century old, that of overcoming all barriers and
becoming part of the European community of values, prosperity and security.
There can be no doubt that accession to the Union will represent one of the
most important moments in Romania's long European history. The signature of
the Accession Treaty opens the door wide towards that moment."

Gabriel is a Canadian based resource company engaged in the exploration
and development of mineral properties in Romania and is presently continuing
the development of its 80% owned Rosia Montana gold/silver project in Romania.

On Behalf of the Board:

Signed by "Oyvind Hushovd"

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OYVIND HUSHOVD
CHAIRMAN & CHIEF EXECUTIVE OFFICER

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responsibility for the adequacy or accuracy of this release and the
information contained herein.