Kootenay step-out drilling encounters 551 g/t silver & 20% combined lead
zinc; 43-101 report confirms high probability of new mineral discoveries at
Promontorio

VANCOUVER, Jan. 14 /CNW/ - Kootenay Gold Inc. (KTN: TSX.V) is pleased to announce step-out drill results and the updated 43-101 Report for the Promontorio Silver Project in Sonora Mexico. Highlights of step-out drill results include 551 g/t silver, 0.63 g/t gold and 20% combined lead-zinc over 3.0 meters in KP 64 at the Ranch EM target. These results show similarities to the Main Pit Zone discovery area where brecciated mineralization grading 46.5 meters of 0.71 g/t gold, 71 g/t silver and 2.09 % lead-zinc was encountered in KP 58 in a step out to the southwest. The Dorotea area is confirmed to be traceable to the northwest for up to 1000 meters.

The 43-101 Report states:

"Exploration work completed by Kootenay has demonstrated the Promontorio Property is highly prospective for large low to intermediate sulphidation epithermal systems that may have developed in close proximity to a shallow level porphyry system" and "There is a high probability that significant new mineral discoveries will be made on the property."

UPDATE ON STEPOUT DRILLING

The current phase of drilling Kootenay has completed 4,273.5m in 13 diamond drill holes over four prospect areas.

Promontorio Main Pit Zone, KP-58-09 to KP-59-09

Two holes were drilled as an approximate 50 meter southwest step out of the Main Pit Zone:

    
        -  KP 59 encountered mineralized breccia grading 46.5 meters of
           0.71 g/t gold, 71 g/t silver and 2.09 % lead-zinc.
        -  KP 58 drilled some 100 meters to the southeast encountered weakly
           anomalous values.
    

Ranch EM anomaly, KP-60-09 to KP-65-09

The first set of holes in the Ranch EM Zone are positive showing a large target area as defined by the extensive alteration over 500 meters of cross section with values of:

    
        -  KP 64: 3.0 meters of 0.63 g/t gold, 551 g/t silver and 20%
           combined lead-zinc.
        -  KP 60: 18 meters of 0.58 g/t gold, 13 g/t silver and 0.68%
           lead-zinc including 2.0 meters 1.49 g/t gold, 26 g/t silver and
           1.24 % lead-zinc.
    

Dorotea, KP-66-09 to KP-68-09

Holes KP 66 to 68 were drilled along strike of the Dorotea discovery. Holes KP 66 and 67 were drilled 80 meters northwest of KP 55 to 57 and KP 68 was drilled 80 meters to the southeast along strike. All holes intersected the sulphide zone returning:

    
        -  KP 68: 6.0 meters of 1.56 g/t gold, 26 g/t silver and 1.71 %
           lead-zinc
        -  KP 67: 10.5 meters of 0.97 g/t gold, 31 g/t silver and 0.65 %
           lead-zinc; including 3.0 meters of 1.83 g/t gold, 58 g/t silver
           and 0.98 % lead-zinc,
        -  KP 66: 3.0 meters of 0.57 g/t gold, 29 g/t silver and 2.45 %
           lead-zinc.
    

Fault offsets are apparent and more than one zone may be present. Mineralization is open ended and additional drilling is required. Hole KP 69 was drilled into a copper showing which is 160 meters southwest of KP 55 to KP 57 and assays are pending.

Dorotea Northwest, KP-70-09 to KP-71-09

KP 70 to 71 are approximately 1000 and 600 meters, respectively to the northwest of the Dorotea discovery, results are pending.

Drill results continue to confirm the large size potential of Promontorio with significant mineralization being encountered in all target areas tested in the current program to date.

    
    Table of Significant Intercepts

    -------------------------------------------------------------------------
               FROM     TO    Interval    Au      Ag     Pb     Zn    Pb-Zn %
      HOLE      (m)     (m)      (m)    (ppm)   (ppm)    (%)    (%)  combined
    -------------------------------------------------------------------------
    KP-58-09  no significant results
    -------------------------------------------------------------------------
    KP-59-09   188.5   235.0    46.5    0.71      71    1.03    1.06    2.09
      inc      190.0   196.0     6.0    0.43     131    2.05    2.07    4.12
      inc      200.5   220.0    19.5    0.95      59    0.89    0.97    1.86
      inc      223.0   232.0     9.0    1.03      83    1.19    1.26    2.45
    -------------------------------------------------------------------------
    KP-60-09    85.0   103.0    18.0    0.58      13    0.37    0.32    0.68
      inc      101.0   103.0     2.0    1.49      26    0.72    0.52    1.24
      AND      121.0   142.0    21.0    0.31      11    0.19    0.23    0.42
    -------------------------------------------------------------------------
    KP-61-09  no significant results
    -------------------------------------------------------------------------
    KP-62-09      hole abandoned
    -------------------------------------------------------------------------
    KP-63-09     results pending
    -------------------------------------------------------------------------
    KP-64-09   187.5     189     1.5    0.24     240    0.50    0.95    1.45
      AND      222.0   225.0     3.0    0.63     551   11.40    8.87   20.27
    -------------------------------------------------------------------------
    KP-65-09  no significant results
    -------------------------------------------------------------------------
    KP-66-09   127.0   134.5     7.5    0.14       6     0.11   0.06    0.17
      AND      151.0   191.5    40.5    0.15       6     0.13   0.13    0.28
      incl     161.5   164.5     3.0    0.57      29     0.90   1.55    2.45
    -------------------------------------------------------------------------
    KP-67-09   109.0   119.5    10.5    0.97      31     0.30   0.35    0.65
      incl     116.5   119.5     3.0    1.83      58     0.47   0.51    0.98
    -------------------------------------------------------------------------
    KP-68-09   189.0   195.0     6.0    1.56      26     0.74   0.98    1.71
    -------------------------------------------------------------------------


    Drill Hole Collar Summary

    ------------------------------------------------------------------------
    HOLE_ID      UTM_E     UTM_N     DIP   AZIMUTH   DEPTH       TARGET
    -------------------------------------------------------------------------
    KP-58-09    628480    3110710    -60     335    453.5     Main Pit Zone
    -------------------------------------------------------------------------
    KP-59-09    628430    3110815    -60     335      459     Main Pit Zone
    -------------------------------------------------------------------------
    KP-60-09    627803    3111144    -60      60      300    "Ranch EM" Zone
    -------------------------------------------------------------------------
    KP-61-09    627680    3111075    -60      60      347    "Ranch EM" Zone
    -------------------------------------------------------------------------
    KP-63-09    627555    3111002    -60      60      303    "Ranch EM" Zone
    -------------------------------------------------------------------------
    KP-64-09    627442    3110942    -60      60      300    "Ranch EM" Zone
    -------------------------------------------------------------------------
    KP-65-09    627442    3110942    -60     100      300    "Ranch EM" Zone
    -------------------------------------------------------------------------
    KP-66-09    626851    3111540    -60      30      232        Dorotea
    -------------------------------------------------------------------------
    KP-67-09    626851    3111540    -45      30      198        Dorotea
    -------------------------------------------------------------------------
    KP-68-09    627008    3111484    -50      30      231        Dorotea
    -------------------------------------------------------------------------
                                                              Copper zone -
    KP-69-09    626936    3111350    -60     225      198      Dorotea SW
    -------------------------------------------------------------------------
                                                               Dorotea NW -
                                                              chargeability
    KP-70-09    626186    3112304    -70     135      441        anomaly
    -------------------------------------------------------------------------
    KP-71-09    626371    3111818    -45      30      211      Dorotea NW
    -------------------------------------------------------------------------
    KP-72-09    626371    3111818    -65      30      300      Dorotea NW
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                  4,273.5m
    -------------------------------------------------------------------------
    

UPDATED 43-101 REPORT

Highlights from the updated 43-101 report include recommendations that, "Future exploration efforts should focus on defining a 43-101 Resource Estimate for the Main Pit Zone, infill drilling on the Dorotea Prospect, continued exploration drilling along mineralized northeast and northwest trending structures and follow up ground exploration surveys to the north of the Yaqui River over areas where base and precious metal showings have been found."

The report goes on to recommend that, "The following work is recommended for the Promontorio Property with the main focus directed at assessing the economic potential of the Main Pit Zone, infill drilling on the Dorotea Prospect, and additional exploration surveys over the areas where new mineralization and or alteration zones have been outlined".

RECOMMENDED WORK PROGRAM

Phase I:

Exploration work directed at evaluating the surface extensions of the mineralized zones along northeast and northwest trending structures that bisect the Main Pit Zone and the Dorotea Prospect. In addition selected airborne EM anomalies would be tested. Ground surveys would include: geochemical sampling, three dimensional induce polarization, and trenching. A total of 5,000 meters of drilling would be required to test mineralized targets.

Phase II:

Would consist of delineation drilling and metallurgical testing of the Main Pit Zone in order to better define mineralization and produce a NI 43-101 compliant Resource Estimate. Drilling would consist of approximately 30 reverse circulation (RC) and 5 HQ core holes, totaling 15,000 meters and be focused on the area bounded between 628250E and 628650E and 3110800N and 3111000N. Reverse circulation drill-holes would target gaps within the present Main Pit Zone drilling and be angled between 70 to 90 degrees. Additional reverse circulation drilling would test the Main Pit Zone to the northeast of holes KP-11-07 and PK-53-08 and to the southwest of KP-13-07 and KP-46-08. Mineralized zones would be sampled at 1 to 1.5 meter intervals.

Phase III:

Work would focus on geological mapping, soil geochemical, geophysical, and trenching surveys to the north of the Yaqui River where new mineralization and or alteration zones have been located. A total of 3,000 meters of drill core will be required to test targets generated from this work. In addition a regional gravity survey is recommended to cover all areas and trends associated with mineralizing events. The purpose of the survey would be to define gravity targets suggestive of large hidden sulphide bodies and or hidden high level porphyries.

The updated 43-101 Technical Report will be filed shortly and available on SEDAR.

Drilling

Drilling is all core and has been contracted to BDW International out of Guadalajara Mexico and all core has been HQ sized. Drill hole coordinates can be viewed at www.kootenaygold.ca

Sampling and Assaying

All core samples are cut by a rock saw with one half being returned to the core box for reference and the other being bagged in a plastic sample bag which is labeled, tagged, documented and sealed with wire. Each sample is placed in a rice sack and sealed with a zip tie. All samples are recorded and delivered to International Plasma Labs Ltd. ("iPL") sample preparation lab in Hermosillo, Sonora, Mexico. Receipt of the samples is signed off at the preparation lab. Pulps of each sample are then prepared and sent to iPL Laboratories in Richmond B.C. Canada an ISO 9001-2000 certified full service laboratory. All of the samples referred to herein are core samples. A QA/QC program which includes the regular insertion by the Company of duplicates, blanks and standards has been instituted. iPL Laboratories also has its own system of replicate analysis and blanks which it provides to the Company. Each pulp is analyzed using iPL's AU(FA/AAS) Ag/Ore-Grade by Multi acid digestion ICP (Cu/Pb/Zn/Ag) assay package. This is a multi acid digestion with gold analyzed with an AA finish with over limits done with gravimetric finish and silver analyzed by ICP (inductively coupled plasma) and a gravimetric finish on over limits while zinc was analyzed by ICP and lead by fire assay. Sample lengths vary from 0.5 to 2.0 meters in width with the majority being 1.5 or 2.0 meters.

The foregoing geological disclosure has been reviewed and verified by Kootenay's CEO, James McDonald, P.Geo (a qualified person for the purpose of National Instrument 43-101, Standards of Disclosure for Mineral Projects). Mr. McDonald is a director of the Company. The 43-101 Technical Report was authored by Guy Mac Gillivray, P.Geo (a qualified person for the purpose of National Instrument 43-101, Standards of Disclosure for Mineral Projects) who was contracted independently to write the report.

ABOUT KOOTENAY

Kootenay is an emerging exploration Company actively developing several mineral projects in the Sierra Madre Region of Mexico and in British Columbia, Canada. Numerous joint-venture partnerships maximize the potential for new discoveries. The Company's top priority remains the ongoing development of its Promontorio Silver project in Sonora State, northwest Mexico, which encompasses the former producing Promontorio Silver Mine.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.

Cautionary Note to US Investors: This news release may contain information about adjacent properties on which we have no right to explore or mine. We advise U.S. investors that the SEC's mining guidelines strictly prohibit information of this type in documents filed with the SEC. U.S. investors are cautioned that mineral deposits on adjacent properties are not indicative of mineral deposits on our properties. This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

SOURCE Kootenay Silver Inc.

For further information: For further information: James McDonald, CEO and President at (403) 238-6986; or Ken Berry, Chairman at (604) 601-5652, 1-888-601-5650; www.kootenaygold.ca

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Kootenay Silver Inc.

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