Klondike Gold Corp.
TSX VENTURE : KG

Klondike Gold Corp.

January 12, 2006 19:40 ET

Klondike Gold Corp.: More 2005 Drilling Results from the Klondike; Klondike Star Intersects 1.91 g/t Gold Over 15.7 Metres

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 12, 2006) - KLONDIKE GOLD CORP. (TSX VENTURE:KG) is pleased to announce that it has received from Joint Venture partner, Klondike Star Mineral Corporation, assay results from holes 16 to 23 of an HQ diamond drilling program conducted in 2005 on the Klondike property. Additional assay results will be released as assays are received, verified and compiled. Klondike Star has the option to earn up to 75% of the Klondike Project by brining it into production. At present they have earned a 51% working interest.

The 2005 diamond drilling program began at the Lone Star zone, near the open pit of the former producing Lone Star mine. Pairs of holes were drilled spaced 50m apart along the length of the Lone Star zone. Holes 16 to 18 were drilled northwest of all previous drilling, and have successfully extended the zone 250m beyond previous detailed drilling. Highlights from these holes, tabulated below, include 6.79 g/t gold over 3.5m, including 38.57 g/t gold over 0.6m in hole 05LS-17. True widths of the mineralized horizons have yet to be determined.

Holes 19 to 23 were drilled to the east of the open pit, in an area with little previous drilling. Highlights from this area include 1.91 g/t gold over 15.7m, including 24.05 g/t gold over 1.0m in hole 05LS-23, the easternmost hole drilled on the Lone Star zone. The distance between holes 18 and 23 is approximately 800 metres, and the Lone Star zone remains open to extension in both directions along strike, to the north, and down-dip to the northeast. Previous drilling conducted in the period between 1986 and 1993 was mostly limited to about 60m depth, and was a combination of reverse circulation, percussion and diamond drilling.

Hole locations for the first 27 holes are shown on a map of the Lone Star zone available on the Klondike Star website (www.klondikestar.com); the final 5 holes were drilled at the Dysle and Veronika zones near Eldorado Creek. The holes reported here all successfully delineated low grade mineralization over substantial widths, many of which contain narrower intervals of higher gold grade. Gold on the property is present as coarse free gold, with pyrite in disseminations, and locally is associated with narrow discordant quartz veins. The mineralized zones are associated with quartz-carbonate-pyrite alteration, and are hosted by felsic metavolcanic schist. The mineralized horizon at Lone Star trends northwest and dips gently to the northeast.



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Assay Table
-------------------------- From To Interval GOLD
HOLE No. Azimuth DIP metres metres metres grams/tonne
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Lone Star Zone
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05-LS-16 approx. -90 60.00 88.00 28.00 0.23
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including 60.60 61.00 0.40 2.23
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including 68.75 76.00 7.25 0.48
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and 121.00 132.00 11.00 0.46
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including 130.00 130.40 0.40 3.59
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05-LS-17 200 -50 32.00 40.00 8.00 0.28
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and 54.00 57.50 3.50 6.79
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including 55.00 55.60 0.60 38.57
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05-LS-18 approx. -90 14.50 16.70 2.20 0.63
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and 85.90 91.00 5.10 0.78
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including 85.90 86.90 1.00 3.52
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and 120.90 123.40 2.50 1.06
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including 121.80 122.40 0.60 2.96
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05-LS-19 approx. -90 63.25 70.00 6.75 0.30
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and 107.20 111.55 4.35 0.53
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and 125.05 148.20 23.15 0.55
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including 125.05 127.55 2.50 1.32
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including 138.55 139.55 1.00 1.90
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05-LS-20 183 -50 4.88 12.10 7.22 0.13
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and 53.34 84.00 30.66 0.17
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and 93.00 103.00 10.00 0.46
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including 102.10 102.60 0.50 4.88
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and 127.00 141.10 14.10 0.43
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including 133.50 134.20 0.70 2.92
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05-LS-21 approx. -90 56.50 84.40 27.90 0.13
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and 122.50 156.25 33.75 0.52
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including 137.00 137.90 0.90 3.90
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including 142.10 142.80 0.70 4.60
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05-LS-22 210 -50 15.00 16.00 1.00 1.91
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and 29.60 61.00 31.40 0.72
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including 49.35 53.00 3.65 4.73
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and 110.00 134.40 24.40 0.62
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including 116.60 117.80 1.20 2.06
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including 133.80 134.40 0.60 11.96
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05-LS-23 approx. -90 53.30 54.00 0.70 1.37
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and 69.60 85.30 15.70 1.91
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including 76.50 77.50 1.00 1.98
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including 82.50 83.50 1.00 24.05
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and 114.00 132.89 18.89 0.26
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including 118.00 119.00 1.00 3.44
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HQ size drill core is delivered to the core shack by the drill contractor, Advanced Drilling Ltd., where the geological staff photographs and logs the core for geological and geotechnical details. The core is then sawn in half lengthwise using a diamond saw, with half core retained for future examination. The half core samples are sealed and shipped via surface freight to Acme Analytical Laboratories Ltd. of Vancouver, B.C., an ISO 9001:2000 accredited facility, where the core is dried, crushed and sampled by analytical procedure 1DX for 36 elements by ICP-MS. Where gold is found to be greater than 100ppb by ICP-MS, the samples are reprocessed using the metallic sieve fire assay procedure on a 500 gram split.

T. Trygve Hoy, PhD., P. Eng., a consultant to the Company, is serving as the Company's Qualified Person for the purposes of the Klondike Project. Mr. Hoy has reviewed and approved this news release.

ABOUT KLONDIKE GOLD CORP.

Klondike Gold is a junior mining exploration company run by the Richard Hughes, a Canadian mine finder who has several discoveries to his credit including the Golden Giant Mine at Hemlo, Ontario. Klondike Gold is looking for gold in Yukon and southeastern British Columbia; Lead/Zinc/Silver also in southeastern British Columbia, and diamonds in the Chapleau/Wawa area in Ontario.

KLONDIKE GOLD CORP.

On behalf of the Board of Directors

Richard Hughes, President

This document contains certain forward looking statements which involve known and unknown risks, delays and uncertainties not under the corporation's control which may cause actual results, performance or achievements of the corporation to be materially different from the results, performance or expectation implied by these forward looking statements.


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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