Avion Gold Corporation
TSX VENTURE : AVR

Avion Gold Corporation

December 21, 2009 16:39 ET

Avion Agrees to Acquire Adjacent Kenieba Concessions with Inferred Resources of 324,000 oz Au for $12/oz

MINERALIZED ZONES OPEN ALONG STRIKE AND DOWN DIP

TORONTO, ONTARIO--(Marketwire - Dec. 21, 2009) - Avion Gold Corporation (TSX VENTURE:AVR) ("Avion Gold") is pleased to announce that it has executed an agreement (the "Acquisition Agreement") with Great Quest Metals Ltd. ('Great Quest') for the acquisition of 100% of Great Quest's interest in the Kenieba concessions.

The Kenieba concessions are located adjacent to the south and west sides of Avion Gold's Tabakoto property and comprise the Kenieba (Sansanto), Kenieba Est and Comifa concessions totaling approximately 32 km2, which increases Avion's local property package by approximately 30%. The Kenieba concession hosts a inferred mineral resource estimate in the Djambaye 2 gold zone of 324,000 ounces of gold, in 2,574,000 tonnes grading 3.92 grams per tonne gold (see Carl Verley (P. Geo.), January 28, 2008 Great Quest news release). This mineralized zone remains open along strike and to depth. The interests of Great Quest in the concessions vary from 95% to 100% and are subject to a carried interest to the Government of Mali ranging between 10% and 20%.

Commenting on the proposed acquisition, Avion's President and CEO, Mr. John Begeman stated: "This acquisition represents an exciting opportunity for Avion to acquire nearby prospective gold projects that could provide additional feed for the Tabakoto mill and to be able now to fully integrate the exploration and potential into Avion's Tabakoto operations".

Avion Gold previously entered into an option agreement in respect of the Kenieba Concessions (see Avion Gold press release dated November 2, 2009) pursuant to which it could earn-in to acquire 75% of Great Quest's interest in the concessions. Pursuant to the Acquisition Agreement, Avion Gold has agreed to pay to Great Quest total consideration of US$4,000,000, which shall be comprised of the payment of US$500,000 in cash and the issue of 7,608,696 Avion Gold common shares. Avion Gold has also agreed to make future contingent payments of up to $2.1 million in the event that it produces more than 400,000 ounces of gold from the Kenieba concessions, payable in increments of 50,000 ounces production. If production from the concessions exceeds 600,000 ounces, Avion would be required to make up to a further $ 1.4 million in payments to complete its obligations under this new agreement.

Don Dudek, P.Geo., the Senior Vice President, Exploration of the Company and a qualified person under National Instrument 43-101, has reviewed the scientific and technical information in this press release.

About Avion Gold Corporation

Avion is a Canadian-based gold company focused in West Africa. The Company holds 80% of the Tabakoto and Segala gold projects in Mali. Gold production at these projects commenced in mid-February, 2009. Avion has provided a 2009 production guidance of 50,000 ounces Au. Avion has a highly skilled management team, with a focus on growth and consolidation within West Africa.

Cautionary Notes

This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, without limitation, statements regarding the impact of the results on the Company; statements with respect to the development potential and timetable of the Mali projects; the future price of gold; the estimation of mineral resources; conclusions of economic evaluation (including scoping studies); the realization of mineral resource estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, geopolitical and social uncertainties; the actual results of current exploration activities; ability to successfully integrate the purchased properties; foreign operations risks; other risks inherent in the mining industry and other risks described in the annual information form of the Company which is available under the profile of the Company on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

To view the map related to the release please follow the link: http://media3.marketwire.com/docs/AVR1221.pdf

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