Kootenay Gold Inc. - Surface Samples Indicate Potential for Multiple
Mineralized Zones at Promontorio Silver/Gold Project

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VANCOUVER, July 21 /CNW/ - Kootenay Gold Inc. ("Kootenay") (KTN: TSX.V) is pleased to report surface samples for the "Gringo", "Vineteria" and "Rico" Zones at the Promontorio Silver Project. These Gold/Silver assays represent results from just three of the 30+ High-Priority EM Targets undergoing exploration at Promontorio. Highlights include:

    
    Vineteria Zone
                 Gold     8.06 g/t; 3.40 g/t; 2.27% g/t; 2.08 g/t
                 Copper   10.95%; 12.8%; 3.5%
    Gringo Zone
                 Gold     8.80 g/t; 3.2 g/t; 3.0 g/t; 2.53 g/t
                 Copper   11.2%; 3.4%; 1.1%
    Rico Zone
                 Silver   895 g/t
                 Copper   8.0%

        For complete results visit: www.kootenaygold.ca
    

Jim McDonald, CEO of Kootenay Gold commented, "Sampling Results and Airborne data define a belt of gold/silver and polymetallic mineralization which can be inferred to extend from the Promontorio Pit area in the south for some 25 km to the northwest. These high grade sampling results outline the presence of anomalous mineralization with similarities to the Pit Discovery zone where drilling has encountered high-grade silver-gold polymetallic breccias with drill hole intersections that include 18.4 meters grading 950 g/t and 151 meters grading 162 g/t silver-equivalent."

    
    Highlights of previous Drilling at the Pit Discovery, N.E. and Dorotea
    Zones

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    Area           Drill     From       To  Interval   Silver   Gold   Pb+Zn
                    Hole       (m)      (m)       (m)    (g/t)  (g/t)     (%)
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    Pit Zone    KP-09-07    61.85    80.25     18.40      366   3.54    6.74
    -------------------------------------------------------------------------
                KP-25-08     2.01   388.65    386.64    46.15   0.44    1.54
    -------------------------------------------------------------------------
                KP-22-07    45.47   196.85    151.38     46.0   0.48    1.56
    -------------------------------------------------------------------------
    NE Zone     KP-80-10    88.00   117.00     29.00       78   1.17    1.43
    -------------------------------------------------------------------------
                KP-81-10   190.50   207.00     16.50      144   0.88    1.97
    -------------------------------------------------------------------------
                   Incl.   195.00   199.50      4.50      364   1.26    2.91
    -------------------------------------------------------------------------
    Dorotea     KP-56-08        0    34.50     34.50    74.83   1.73    2.42
    -------------------------------------------------------------------------
                   Incl.     9.00    18.00      9.00   173.40   3.28    5.24
    -------------------------------------------------------------------------
                KP-55-08     3.00    16.50     13.50    77.39   2.78    1.08
    -------------------------------------------------------------------------
                   Incl.     3.00     9.00      6.00   167.20   5.92    1.62
    -------------------------------------------------------------------------
        For complete results visit: www.kootenaygold.ca
    

This phase of exploration investigated 10 anomalies/target areas. Sampling and mapping was conducted with grab samples ranging from background to the above noted highs. Results outlined the presence of three areas of anomalous mineralization with similarities to the Promontorio Pit and Northeast Zones, and appear to be controlled by a regional structural setting that also controls the mineralization of the Pit Zone.

Vinteria Zone

The most encouraging of the three areas is a coincident EM target located 5 km northwest of the Pit Zone. This EM anomaly is coincident with intense argillic, sericitic and silicified alteration hosted in faulted and sheared Triassic sandstones (Area A007 Vineteria showing). Preliminary prospect sampling identified precious metal mineralization with of 2.27, 1.2, 1.1, 0.95 and 0.85 g/t gold and 74 g/t silver in association with highly anomalous copper, lead, and zinc (See accompanying map). This mineralized alteration zone is hosted within a 300-400 meter wide shear zone traceable northwesterly for over 1000 metres, open to the north and south. Named Vineteria this target is similar to the Promontorio Pit showing in that it has the same magnitude of gold and silver geochemistry, hosts strong argillic alteration and has a similar EM signature.

Comparing the two areas; Vinteria returned an average from 130 samples of 0.299 g/t gold,, 5 g/t silver, 0.89 % copper, 0.05 % lead and 0.014% zinc compared to 0.245 g/t gold, 26 g/t silver, 0.05% copper, 0.35% lead and 0.1% zinc from 609 samples taken from the Pit zone area.

Gringo Zone

The second promising area is two to five km to the northwest of Vineteria. Here a northwest trending coincident EM/resistivity anomaly (area A009 - Gringo zone) similar to the Pit Zone contains quartz veins and stockworks in Tertiary volcanics and manganese/iron carbonate veins within the fault trace. Immediately peripheral to the geophysical anomaly, anomalous gold and silver traceable for over 400 metres with values from background to 8.8g/t gold and silver to 170 g/t is hosted in veins, breccias and shear zones associated with quartz, sericite and tourmaline alteration (See accompanying map).

Rico Zone

The third area, two km northeast of Vineteria, is a circular EM anomaly (A016) over zones of intense tourmaline-propylite alteration of Cretaceous volcanics. To the immediate northwest of anomaly A016, isolated veins of quartz, chalcedony and calcite with minor copper and local gold (to 0.87 g/t) and silver (to 895 g/t) were noted along a northwest trending fault structure.

Other EM/resistivity anomalies investigated in the area are underlain by propylite altered Cretaceous andesitic volcanics with local, isolated veins, few with noted anomalies, mainly copper and appear to be of low potential (areas A011, 012, 017, 012, and south part of A008).

It is apparent that the geologic setting and controls of the mineralization define a belt of gold/silver and polymetallic mineralization and alteration that can be inferred to extend from the Promontorio Pit area in the south for some 25 km to the northwest.

The second phase of this EM target program is now underway and is focused on the next set of uninvestigated EM "look a like anomalies" further north.

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 Kootenay.

SAMPLING, ASSAYING AND QA/QC

Samples were placed in labeled rice sacks and sealed. All samples were recorded and delivered to the ALS Chemex sample preparation lab in Hermosillo, Sonora, Mexico. Receipt of the samples was signed off at the preparation lab. Pulps of each sample were prepared in Hermosillo and sent to ALS Chemex, North Vancouver, B.C., Canada, an ISO 9001-2000 certified full service analytical laboratory.

ABOUT KOOTENAY

Kootenay is actively developing mineral projects in the Sierra Madre Region of Mexico and in British Columbia, Canada. The Company flagship property is the former producing Promontorio Silver Mine in Sonora State, Mexico.

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.

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