Kestrel Gold Inc.
TSX VENTURE : KGC

September 21, 2010 09:25 ET

Kestrel Gold Announces Proposed Private Placement of Up to $4,000,000

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 21, 2010) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.

Kestrel Gold Inc.(the "Corporation") (TSX VENTURE:KGC) is pleased to announce that the Corporation proposes to complete a non-broker private placement of up to 10,000,000 units ("Units") of the Corporation at a purchase price of $0.40 per unit for total proceeds of $4,000,000. Each Unit shall consist of one (1) common share and one (1) share purchase warrant ("Warrant") of the Corporation. Each full Warrant shall entitle the holder to purchase one (1) Common Share of the Corporation at a purchase price of $0.60 per Common Share exercisable on or before one (1) year from the date of issuance of the Warrants. In certain instances the Corporation may pay a 7% cash commission or a 10% commission payable in Common Shares of the Corporation valued at the same price as the private placement plus 10% brokers warrants to purchase Units of the Corporation at the same price of the Units are being purchased for under the private placement.

All Common Shares, Warrants and any Common Shares into which such securities may be converted shall be subject to a four (4) month hold period from the closing date of the proposed private placement.

Proceeds from the private placement shall be used to fund obligations under the previously announced loan arrangement and the Option and Purchase Agreement relating to Rio Diablillos (S.R.L.) and for general working capital purposes.

About Kestrel Gold Inc.

Listed on the TSX-V, Kestrel is committed to acquiring, exploring and development precious metal projects in North and South America. It has an experienced and committed board of directors and the financial ability to aggressively meet its objectives.

Cautionary Statements

This news release contains "forward-looking statements" within the meaning of applicable securities laws relating to a proposal to complete a private placement of Units of the Corporation. Readers are cautioned to not place undue reliance on forward-looking statements. Forward-looking statements are based on certain key assumptions made by the Corporation, including assumptions regarding the ultimate terms of the proposed transaction, completion of definitive agreements, the satisfaction of conditions to the completion of the transaction and the receipt of all regulatory and stock exchange approvals. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the option, that the ultimate terms of the option may differ from those that currently are contemplated, that the option will not be successfully completed for any reason (including the failure to obtain the required approvals or clearances from regulatory authorities. The forward-looking statements in this press release are made as of the date of this release and the Corporation undertakes no obligation to update publicly or revise any forward-looking statements whether as a result of new information or otherwise, except as required by applicable securities laws. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Corporation or its financial or operating results or (as applicable) their securities.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

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