Majestic Gold Corp.
TSX VENTURE : MJS

Majestic Gold Corp.

January 05, 2007 17:00 ET

Majestic Gold Corp.: Option Agreement With Central China Goldfields plc

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 5, 2007) - On November 28, 2006 Majestic Gold Corp. ("Majestic") (TSX VENTURE:MJS) announced that it had entered into an agreement with Central China Goldfields plc. ("CCG") pursuant to which CCG was granted an option (the "Option") to acquire a 50% interest in Majestic China Mining Corp. ("MCMC"), a wholly-owned subsidiary of Majestic. To maintain its Option, CCG was required to advance CAD$1.5 million on or before November 30, 2006 (the "First Payment") and CAD$1.5 million on or before December 31, 2006 (the "Second Payment"). CCG advanced the First Payment but did not advance the Second Payment. Consequently, the Option has lapsed.

Majestic will seek other financing options including the possible re-negotiation of its agreement with CCG to further develop its two advanced-stage exploration properties in China, Song Jiaguo (Shandong Province) and Sawayaerdun (Xinjiang Province), both of which have initial NI 43-101 resource estimates completed.

On Behalf of the Board of Directors

Rod Husband, P.Geo., Director, President and CEO

This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

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

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