GOLCONDA RESOURCES LTD.
TSX VENTURE : GA

GOLCONDA RESOURCES LTD.

December 16, 2008 21:31 ET

Golconda Resources Ltd. Announces Acquisition of Lyncorp Drilling Services Inc.

CALGARY, ALBERTA--(Marketwire - Dec. 16, 2008) - Golconda Resources Ltd. (TSX VENTURE:GA) (the "Corporation" or "Golconda") is pleased to announce that it has completed the acquisition (the "Acquisition") of Lyncorp Drilling Services Inc. ("Lyncorp") as contemplated in the Corporation's press releases dated May 12, 2008 and November 21, 2008. Pursuant to the acquisition agreement dated November 4, 2008 (the "Acquisition Agreement") among Golconda, Lyncorp and David Mullen, sole shareholder of Lyncorp, Golconda acquired of all of the issued and outstanding securities of Lyncorp for an aggregate purchase price of $6,500,000, subject to adjustment, payable by the issuance of:

(a) 32,500,000 common shares of Golconda ("Common Shares"), at a deemed price of $0.10 per Common Share; and

(b) a 10% secured debenture in the principal amount of $3,250,000, subject to adjustment, to be repaid in full on the earlier of (i) the closing date of Golconda's first equity financing after the completion of the Acquisition or (ii) 24 months from the closing date of the Acquisition. The principal amount of the secured debenture shall be increased or decreased on a dollar for dollar basis to the extent that the value of the net tangible assets of Lyncorp as at the closing date of the Acquisition is greater than or less than $4,000,000.

Lyncorp, a private company incorporated under the laws of Alberta and headquartered in Calgary with its operations center in Smithers B.C., provides diamond core drilling services to the exploration industry in Western Canada and Western United States. Lyncorp has eight drilling rigs capable of fly and deep hole drilling. David Mullen, the sole shareholder of Lyncorp, prior to the issue of the 32,500,000 Common Shares pursuant to the Acquisition held an aggregate of 7,740,000 Common Shares, representing 13.7% of the issued and outstanding shares of Golconda; therefore, the Acquisition was a non arm's length transaction. David Mullen now holds a total of 40,240,000 Common Shares, representing 42.9% of the issued and outstanding shares of Golconda.

In conjunction with the Acquisition, $483,125 of debt owed by Golconda to Lyncorp (or its assignees) was repaid and cancelled by the issuance from treasury of 4,831,250 Common Shares, each having a deemed value of $0.10 per Common Share (the "Debt Settlement") (collectively, the Acquisition and the Debt Settlement are referred to herein as the "Transactions").

Following completion of the Transactions, each of Terry S. Chan, Reynoudt W. Jalink and Lyle Pederson resigned as directors of Golconda and David E. Mullen, Gerald N. Gilewicz and Thomas E. Callicrate were appointed to the Golconda board. Robert Gillies was also appointed the Chief Financial Officer of the Corporation. As such, the senior executives and the board of directors of Golconda are as follows:

Sid Dutchak (President and Chief Executive Officer)

Mr. Dutchak, an independent businessman, is the Corporation's President and Chief Executive Officer. Mr. Dutchak was previously the President of Cordy Oilfield Services Inc. (formerly QCC Technologies Inc.) from March 2001 to July 2007. Prior to that, Mr. Dutchak was a director of QCC Technologies since 1999. Mr. Dutchak has served on several public company boards, and within the past five years served on the boards of West Mountain Capital Corp., How To Web TV Inc., Ergo Ventures Inc. and Maple Leaf Reforestation Inc.

Robert Gillies (Chief Financial Officer)

Mr. Gillies is the Corporation's Chief Financial Officer. Mr. Gillies was previously the Chief Financial Officer of Cordy Oilfield Services Inc., a public company listed on the TSX Venture Exchange ("TSX-V"). Mr. Gillies is a Chartered Accountant with 30 years experience as a Partner in accounting firms and as a Chief Financial Officer in several public companies listed on the TSX-V and the Toronto Stock Exchange ("TSX"). He has spent considerable time working with start-up and emerging businesses.

Howard G. Coopersmith, R.P.G. (Director)

Mr. Coopersmith has over 30 years experience in diamond deposits and project evaluation, feasibility and development, including projects in North America, South America, southern Africa, West Africa, Australia, India and Europe. Previously an officer/director of several diamond explorers and miners, he currently consults for select clients and various international engineering consultancies, investment bankers and brokerage houses and is frequently an invited speaker at conferences.

David Mullen (Director)

Mr. Mullen is a director of Shear Minerals Ltd. and Copper Fox Metals Inc., which are publicly traded mineral exploration companies. Mr. Mullen is the Chief Executive Officer of Cordy Oilfield Services Inc., a publicly traded oilfield services company. Mr. Mullen has also been a director of Rocky Mountain Dealerships Inc., a TSX listed company, since December, 2007. Previously, Mr. Mullen served in various capacities, including Senior Vice President of Mullen Trucking LP, a wholly-owned subsidiary of Mullen Group Income Trust.

Gerald N. Gilewicz (Director)

Mr. Gilewicz has served as Vice-President of Finance and Chief Financial Officer of Vero Energy Inc. since November 2005. Previously, Mr. Gilewicz was the Vice President of Finance and Chief Financial Officer of Dual/Devlan Exploration Inc. from 1999 to November 2005 and a Senior Manager with Deloitte & Touche LLP.

Thomas E. Callicrate (Director)

Mr. Callicrate, P.Geol., has over 28 years of experience in domestic and international mineral exploration and specializes in generating and evaluating a variety of quality precious and base metal, gemstone, industrial and mineral exploration properties, as well as managing reconnaissance and advanced level exploration programs. He is the Co-Founder of Consolidated Goldfields Inc. and currently serves as its Chief Executive Officer and President. Mr. Callicrate has also served as Vice President, Exploration of Consolidated Goldfields Inc., since August 2006. He served as Vice President, Exploration of Western Goldfields Inc., from November 2003 to October 10, 2005 and also served as a director of Western Goldfields Inc., from August 2002 to October 25, 2005.

At the shareholders meeting held on December 16, 2008, all matters placed before the shareholders were approved including the Transactions. Please refer to the management information circular (the "Circular") of Golconda dated November 4, 2008 for additional information and disclosure regarding the Transactions and the other matters noted above. The Circular is also available on Golconda's SEDAR profile at www.sedar.com.

Following the completion of the Transactions, the Corporation has 93,743,484 Common Shares issued and outstanding. The Transactions are subject to final TSX-V acceptance.

THE TSX VENTURE EXCHANGE HAS IN NO WAY PASSED UPON THE MERITS OF THE TRANSACTIONS AND HAS NEITHER APPROVED NOR DISAPPROVED THE CONTENTS OF THIS PRESS RELEASE. NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

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