Kenai Resources Ltd.

Kenai Resources Ltd.

December 19, 2011 09:00 ET

Kenai Resources to Acquire 100% of Sao Chico Gold Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 19, 2011) - Kenai Resources Ltd. ("Kenai") (TSX VENTURE:KAI). Mr. Daniel Kunz, Chairman of Kenai, announced today that Kenai has entered into a letter agreement (the "Agreement") with ASX-listed Gold Anomaly Ltd ("GOA") to acquire GOA's wholly-owned subsidiary, Gold Aura do Brasil Mineração Ltda ("GOAB"), which holds 100% of the Sao Chico gold project mineral rights. The consideration payable by Kenai includes: a) forgiveness of an existing loan of AUD$3,500,000 due to Kenai from GOA which is part of cash advances made by Kenai for the Sao Chico gold project; b) issuance of 10 million common shares of Kenai following regulatory and related approvals, with such shares subject to a 12 month non-trading hold period; and, c) the issuance of an additional 6 million Kenai common shares when one of several development milestones are achieved for the Sao Chico project such as completion of a bankable feasibility study. Under the terms of the Agreement, Kenai has no other obligations to GOA for royalty, net profit interest or similar payments in the future.

Mr. Kunz said, "This acquisition simplifies the ownership structure to allow Kenai to focus its efforts on further exploration and a development plan at Sao Chico. Kenai will be releasing all the drill hole and official assay results for the recently completed 3,268 meter drill program when they become fully available within the first quarter of 2012."

Upon completion of definitive documentation, the Agreement will replace an existing Option and Loan Agreement with GOA under which Kenai forwarded AUD$4,150,817 in anticipation of exercising an option that would have resulted in Kenai acquiring 75% of GOAB.

The Agreement provides Kenai with full ownership of Sao Chico and an oxide ore treatment plant that GOA recently constructed. Kenai will evaluate the usefulness of the plant which is currently on care and maintenance. Kenai drilling confirmed the discovery of two high grade gold zones containing sulphide mineralization. Kenai has drilled 3,268 meters in 22 core holes completing the Stage One diamond drilling program. Almost every drill hole intercepted significant gold bearing structures. Currently, the deepest intercept is 220 meters from surface. The drilling has successfully identified high grade gold mineralization over a 650 meter strike length. To date, the gold bearing structures have vein true widths from just less than 1 meter to greater than 2.5 meters.

Official gold assays reported in the November 28, 2011 Kenai news release include Drill Hole 002 with an true vein width of 1.12 meters and an official grade of 17.7 grams per tonne gold ("g/t"); Hole 004 intercepted a 2.64 meter wide vein containing 35.9 g/t; Hole 005 hit a 0.95 meter vein width with 115.9 g/t; and Hole 006 intercepted a 1.29 meter vein width containing 73.1 g/t. For cross sections and plan view drawings of the drilling program please see our website at Current exploration activity is confined in a 56 hectare ("Ha") area of a 1400 Ha exploration lease and GOAB has applications for over 8,000 additional Ha of exploration land.

About Kenai Resources Ltd.

Kenai is a Canadian company focused on precious mineral project exploration and development, towards early significant gold production. In addition to the Sao Chico gold project in Brazil, Kenai is also involved in exploration of the wholly-owned Quartz Mountain and Hope Butte gold epithermal gold projects in South-Eastern Oregon, both located in Malheur County, close to the Oregon border with Idaho.

Forward-Looking Statements: Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed and elsewhere in the company's periodic filings with Canadian securities regulators. The economic viabilities of the resources estimates discussed in the release have not been established and may not be. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The company does not assume the obligation to update any forward-looking statement.

Kenai's Vice President Technical Services, Neil Cole, is responsible for technical information in this release. Mr Cole has sufficient experience which is relevant to the style of mineralization under consideration and to the activity which is being undertaken and planned to qualify as a Qualified Person under NI 43-101. Mr Cole has verified the technical data disclosed in this release, including references to planned exploration and operational activities, and the sampling of the gold-bearing reef structures. Mr Cole has consented to the inclusion in this release of such technical information in the form and context in which it appears.

Shares Outstanding: 62,406,734

Neither the 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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