August 21, 2008
Klondike Gold Corp.’s Joint Venture Partner Klondike Star Mineral Corp. Green Lights Indian River Gold Project
Klondike Gold Corp. (TSX VENTURE: KG) wishes to clarify the disclosure in its August 19, 2008 news release wherein it was stated that our joint venture partner, Klondike Star Mineral Corp., had identified a probable mineral reserve. This statement has not been confirmed with a National Policy 43-101 technical report, nor has there been confirmation of 66,000 crude ounces of gold. A feasibility study has not been completed and there is no certainty that proposed operations will be economically viable. Our news release should therefore read as follows:
Klondike Gold Corp. is pleased to announce that the board of directors of joint venture partner Klondike Star Mineral Corp. has recently reported that they are moving forward with a mining plan.
Our joint venture partner Klondike Star Mineral Corp. has thus far drilled over 600 holes on 60% of the Indian River property. Gold was recovered from nearly 100% of the holes in the main target area. The target zone forms a wedge that is 300 meters/984 feet at the beginning and broadens to a width of over 1,500 meters/4,921 feet. To date, the mineralized zone extends over a distance of more than 3 kilometers/1.9 miles) and remains open to expansion to the east and south. Gold is uneven but consistently distributed across this broad area with gold values present across the entire width of the property. The fineness of the gold assayed at over 82%. If mining results are typical of the industry's experience in the Klondike, the extent of mineralization could be higher by as much as 20-30%.
Hans Boge, P.Eng., President of Klondike Star Mineral Corp., says: "At current and projected gold prices, even this relatively modest gold deposit is worthy of development. Furthermore, Klondike Star is already fully permitted to develop and operate the Indian River gold mine."
Klondike Star Mineral Corp.'s development plan is to phase into production starting with large-scale test mining. The approach offers financial, tax, risk management and operational advantages. Stripping of the organic ground-cover and non-gold bearing gravels is currently scheduled to commence late fall/early winter. The mining plan designed specifically for the Indian River ground is scaleable allowing for substantial increases in annual gold production over time.
Among the advantages of the Indian River property are that it can be brought into production quickly. It lends itself to environmentally responsible mining methods already employed successfully in the Klondike that engineers have refined to reduce energy requirements and minimize operating costs. The Company also has camp facilities and some of the required equipment on the project site.
Klondike Star Mineral Corp. is currently in negotiations for required financing of the mine.
Klondike Gold Corp. is entitled to receive a 5% royalty on all gold or other minerals produced from joint venture Indian River placer properties with Klondike Star Minerals Corp.
About the Indian River Gold Project
The Indian River Placer Project is an advanced-stage placer gold exploration property consisting of 223 placer bench claims and 2 leases totaling about 21.1 km2/8.2 mi2 located in a wide, shallow valley about 35 miles from Dawson City, Yukon in the heart of the Klondike gold-producing region. The property has never been mined or subjected to modern recovery methods and as of April 29, 2008, all the operating permits necessary for Indian River mine development and gold production have been received. The goal now is to develop a large-scale placer mine.
About Klondike Gold Corp.
Klondike Gold Corp.'s portfolio covers mineral exploration for gold, silver, lead, zinc, and diamonds in some of the best known mining areas of Canada. Details relating to exploration activities on specific properties will be announced as the work programs are implemented.
For further information visit Klondike Gold's web-site: www.klondikegoldcorp.com to see Smartstox interviews with the Company's President, Mr. Richard Hughes.
The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.
Contacts: Hughes Exploration Group Alan Campbell Investor Relations (604) 685-2222 Hughes Exploration Group Kevin Hull Investor Relations (604) 685-2222 (604) 685-3764 (FAX) Email: [email protected] Website: www.klondikegoldcorp.com
SOURCE: Klondike Gold Corp.