Kootenay and Arctic Hunter enter into option agreement to drill the Santa
Lucia gold property in Mexico

VANCOUVER, Dec. 10 /CNW/ - Kootenay Gold Inc. ("Kootenay") (KTN: TSX.V) and Arctic Hunter Uranium Inc. ("Arctic") (AHU: CNSX) are pleased to announce they have entered into a Letter Agreement, whereby Arctic has the right to earn 60% interest in the Santa Lucia Property, Sonora Mexico. Kootenay has granted Arctic the right to earn an undivided 60% interest in the Property in exchange for US$25,000 on signing of the Agreement; issuing an aggregate of 750,000 common shares of Arctic to Kootenay; and funding an US$1,000,000 of exploration expenditures on the Property within a four years period.

Drill Targets Identified

During the last several years Kootenay has conducted extensive exploration on the Santa Lucia Property which includes prospecting, mapping, sampling, Airborne Mag and EM work. In addition, a complete historic Data Package was purchased in 2009. The Data contains information from more than US$1 million of exploration expenditures conducted in the 1990's. Based Kootenay's exploration and drill intercepts contained within the Data Package, several compelling Drill Targets have been identified. Planning and permitting is now underway for a comprehensive diamond drilling program at Santa Lucia.

Geological Information

The Santa Lucia project consists of a very large concession, extending about 16.5 km north-south x 11.5 km east-west. The project area contains several styles of precious-metals mineralization including: 1) coarsely crystalline, deep-seated, gold-silver +/- minor base metals quartz veins in Mesozoic plutonic rocks, 2) vuggy finely crystalline quartz-breccia veins and stockworks in Tertiary volcanics, 3) barren sulfide-deficient hairline quartz veinlets in Tertiary volcanics, 4) barren sulfataric (argillic and silicic) alteration in andesitic volcanics.

Terms of Agreement

To fulfill the terms of the option agreement Arctic must spend US$1 million on exploration over four years and issue up to 750,000 shares with 150,000 shares due on execution of the Letter Agreement and 150,000 common shares of Arctic on or before the first year anniversary and each of the second, third and forth anniversaries thereafter, of the Execution Date. Subsequent to exercise of the earn-in, Arctic and Kootenay will form a 60/40 joint venture. Funding of further work on the Santa Lucia Property will be on a proportional basis under the direction of a management committee with voting rights proportional to ownership percentage. Either party may be diluted on the basis of a standard formula if they do not contribute to the planned programs. If either party is diluted below 10%, their interest will convert to a 1.5% NSR royalty. The Santa Lucia Property currently has an underlying NSR of 2.5% of which 1.25% can be purchased for US$1 million.

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.

About Kootenay

Kootenay is an emerging exploration Company actively developing mineral projects in the Sierra Madre Region of Mexico and in British Columbia, Canada. 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.

About Arctic

Arctic Hunter is involved in the acquisition, exploration and development of mineral properties. The Company has acquired a 100% interest in a uranium prospect comprised of eight mineral claims of approximately 6,270.83 hectares, located near Lever Lake, Northwest Territories, and known as the Lever Lake Property to determine if economic quantities of minerals exist on the property. The Company also intends to devote a portion of its efforts to the assessment and acquisition of additional mineral exploration properties and will consider the acquisition of such properties if opportunity to acquire properties of value and interest to the Company arises.

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

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