Midway Gold Corp.

Midway Gold Corp.

January 07, 2005 17:46 ET

Midway Updates Projects Progress


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: MIDWAY GOLD CORP.

TSX VENTURE SYMBOL: MDW

JANUARY 7, 2005 - 17:46 ET

Midway Updates Projects Progress

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 7, 2005) - Midway Gold
Corp. (the "Company") (TSX VENTURE:MDW) announces that drilling
continues at the Spring Valley (Pershing Co., Nevada) and the Goldstrike
project (Washington Co., Utah). A drill test was completed at the Pioche
project, Lincoln Co., Nevada.

New Gold Zone Discovered at Spring Valley Project

Midway has completed 4190 feet (14 holes) of a planned 10,000 feet of
reverse circulation drilling at the Spring Valley project. Preliminary
assays indicate a zone of 60 feet of 0.034 ounces per ton (opt) gold
(18.3m of 1.16 grams per ton (g/t) gold) in an angle hole (-60) from 95
to 155 feet in a rhyolite sill with quartz-tourmaline veins. This is a
new gold zone, 500 feet east of the Pond zone, in a shallower structural
block. A second drill hole encountered 5 feet of 0.076 opt gold (1.5 m
of 2.6 g/t gold) at the alluvium-bedrock contact suggesting a nearby
buried gold source. The hole was lost due to poor drilling conditions
before the target horizon was reached. A third drill hole encountered 50
feet of 0.62 opt silver (15.2m at 22g/t) and 10 feet of 0.018 opt gold
(in the edge of a newly identified breccia pipe 2000 feet) east of the
Pond zone. These assay results are preliminary and because of the course
nature of the gold, additional check assays are being conducted to
verify these results. Drilling has been hampered by extremely wet and
muddy conditions in Nevada the last three months. Additional drilling is
planned in early 2005 to test some of the thicker breccia targets, which
are not currently accessible. An updated NI 43-101 Report on the Spring
Valley project, by Mine Development Associates of Reno, Nevada, is being
filed on SEDAR with this release.

Midway Engineering Reviews

At the Midway project, in Nye County, Nevada, pre-feasibility
engineering studies are being completed on three of the six known gold
zones. "These studies will give us an inferred gold resource and
preliminary economic parameters necessary to put the project into
production. We also will use a 3-D model, to plan drill holes that will
expand these zones and explore the known targets around these deposits,
during the first quarter of 2005," says Alan Branham, president of
Midway.

In order to allow Midway to take ownership of the project and hold off
larger royalty payment until the property is put into production, the
original property lease with the underlying owners was renegotiated on
the Midway project. In the new lease, Midway Gold Corporation may
acquire title to the Midway property upon making a $200,000 property
payment August 15, 2005. The owners will waive the $3 million cash
payment due in 2006 in exchange for $250,000 advance royalty payments in
2006 and 2007, increasing to an annual advance royalty payment $300,000
in 2008. The owners also now have a sliding royalty on all precious
metals from production tied to the gold price. The royalty will range
from 2% at gold less than $300/ ounce (London Metal price) and go as
high as 7%, at $700/ounce gold, with increases of 1% for every $100
greater than $300.

Salt Lake Pioche Silver Drill Test Completed

"At Pioche Midway discovered the offset of the high-grade Salt Lake
Pioche Vein and one new vein. However, this portion of the vein had not
experienced the secondary supergene enrichment that produced the
high-grade values of the historic mine," says Alan Branham, President of
Midway. The down dropped portion of the vein had been covered with a
shale and post-mineral volcanic tuff. Preliminary assays indicate that
these drilled veins and replacement zones contain up to 5 feet of 0.146
opt gold (1.5m of 5 g/t gold) and 35 feet of 2.16 opt silver (10.7m of
72 g/t silver). These assays are being verified by a second assay lab.

Drilling at Goldstrike, Utah

Drilling is continuing at the Mineral Mountain and Red Hollow projects,
in the Goldstrike District, Washington County, Utah. Approximately 12 to
15 holes are planned to test Carlin style gold discovered in Tertiary
siltstone with gold values of 0.03 to 0.05 opt (1-2 g/t) gold collected
from surface sampling. A new NI 43-101 report on the Goldstrike property
has been completed by Mine Development Associates and is being filed on
SEDAR with this release.
Midway Gold Corp. is a mineral exploration company, listed as a Tier 1
issuer on the TSX Venture Exchange under the symbol "MDW". Details of
Midway Gold's projects are available on the Company's website at
www.midwaygold.com.

ON BEHALF OF THE BOARD

Alan Branham, President and CEO


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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Midway Gold Corp.
    Ron Cooper
    Toll Free: 1-877-692-8288
    Website: www.midwaygold.com
    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release.