Otis Gold Corp.

Otis Gold Corp.

December 16, 2010 08:01 ET

Otis Drills 87.8 Metres of 1.26 g/t Au Including 32.0 Metres of 3.46 g/t Au at Kilgore

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 16, 2010) - Otis Gold Corp. (TSX:OOO) ("Otis" or the "Company") is pleased to announce the receipt of additional significant drill results comprising potentially bulk-mineable, open-pittable intercepts from the third set of logged and processed holes of its 2010, 35-core hole, 6,657-metre, Kilgore Mine Ridge Gold Project ("Kilgore") drill program located in Clark County, Idaho. Highlights of this third grouping of seven holes, listed in Table 1 below, include intercepts of 87.8 metres (m) of 1.26 grams per tonne gold (g/t Au) that further includes 32.0 m of 3.46 g/t Au in hole 10 OKC-228, 45.7 m of 1.22 g/t Au in hole 10 OKC-226, 30.5 m of 1.28 g/t Au in hole 10 OKC-218, 30.5 m of 1.24 g/t Au in hole 10 OKC-227, and 27.5 m of 1.72 g/t Au in hole 10 OKC-245. All holes encountered mineralization and were drilled as infills or extensions of areas where historic wide-spaced drilling resulted in gaps and/or areas of open-ended mineralization.

Table 1. Otis Gold 2010 Kilgore Gold Project Drill Highlights – Third Grouping

Hole    Number From (metres) To   (metres) Thickness (metres) Grade      (g/t Au)
10 OKC-218 138.1 168.6 30.5 1.28
10 OKC-219 182.3 183.8 1.5 1.47
  45.1 46.6 1.5 3.58
10 OKC-226 68.0 72.5 4.5 1.21
  214.3 260.0 45.7 1.22
includes 246.3 257.0 10.7 3.53
10 OKC-227 87.8 118.3 30.5 1.24
includes 98.5 107.6 9.1 2.47
10 OKC-228 11.9 99.7 87.8 1.26
includes 64.6 96.6 32.0 3.46
10 OKC-229 15.8 18.8 3.0 1.14
  60.4 93.9 33.5 0.58
10 OKC-245 2.4 29.9 27.5 1.72
  104.5 113.7 9.2 1.09

Most importantly, hole 10 OKC-228 containing 87.8 m @ 1.26 g/t Au is directly on strike from and appears geologically associated with Otis' hole 08 OKC-191 that contains 55.4 m @ 6.15 g/t Au (Otis October 7, 2009 News Release). Specifically, Otis geologists believe these two mineralized intercepts, some 75 metres apart and open-ended along strike to the northwest and southeast for at least 250 metres, are associated with the same mineralized, northwest-trending dike sequence that occurs throughout the higher-grade core of the Kilgore Mine Ridge deposit. This highly prospective area will require detailed follow-up drilling in 2011 that could likely add additional resource ounces along the open-ended extent of its strike length.

These new intervals, along with those from the first thirteen core holes reported on from Otis' 2010 Kilgore drill campaign (Otis September 2 and October 10, 2010 News Releases) and from other significant bulk-tonnage intercepts determined for a number of the Company's core holes drilled during 2008 and 2009 in the nearby higher-grade Mine Ridge core area of the deposit (Otis October 7 and December 16, 2009 and March 23, 2010 News Releases), all support a high degree of confidence concerning continuity of mineralization throughout the deposit. These intervals further indicate the presence of mineralized thicknesses that are noticeably greater than those constituting the majority of the intervals comprising the historic Kilgore NI 43-101 compliant resource (Otis March 2, 2009 News Release). Based on results to date, Otis expects that there is a strong possibility to increase the overall size and economic viability of the Kilgore deposit. Three dimensional computer modeling of the deposit is being initiated and is expected to be completed 2011 after all the 2010 drill results have been obtained and incorporated into the database. Assays from the remaining 15 core holes will be released as they become available.

As a continuation of Otis' successful 2008 and 2009 drilling programs, this year's aggressive drill program, completed in late October, was conducted as first-round in-fill and extension of the much larger 800-metre-long and 400-metre-wide Kilgore deposit area surrounding the deposit's higher-grade, 200-metre wide, Mine Ridge core area. Historically, much of the surrounding area was drilled on extremely wide, 60- to 120-metre-spaced centers, with in-fill and extension drilling necessary to more fully and clearly evaluate the deposit. Historic drilling was conducted by Bear Creek, Pegasus Gold, Placer Dome U.S., and Echo Bay Mines from 1983-1996, while exploring the property for a bulk-tonnage gold deposit (Otis June 10, 2008 News Release).

Locations of this third grouping of seven holes, which total 1,380 metres of drilling, and their corresponding assay intercepts, are shown in a drill-hole location map available on the Otis Gold Corp. website at www.otisgold.com/projects/kilgore/.

Analysis and Otis QA/QC Program

All assay work was performed by ALS Chemex Labs, Vancouver, B.C., which has ISO 9001:2008 quality management system certification and ISO 17025:2005 Vancouver Lab technical capability accreditation. A 50-gram pulp of all samples was assayed for gold by Fire Assay/AA finish methods. Certified reference materials, duplicates, and blanks were inserted into the sample stream for quality control.

True bulk-tonnage widths are estimated to be between 90% and 100% of the drilled interval, based on their estimated dip, association with diking, and continuity of mineralization between drill holes. The HQ3-size core drilling was performed by Timberline Drilling, Inc., Coeur d'Alene, Idaho, employing two Sandvik DE-140 core drills outfitted with a triple-tube core recovery system and face-discharge bits. Drilling results will be reported throughout Winter 2011 as they are received.

John R. Carden, Ph.D., Lic. Geo., a Qualified Person as defined by National Instrument Policy 43-101, is responsible for the technical information contained in this News Release.

About the Company

Otis is a resource company focused on the acquisition, exploration, and development of precious metal deposits in Idaho, USA. Otis is currently developing its flagship property, the Kilgore Gold Project, located in Clark County, Idaho.


Craig T. Lindsay, President and CEO

This news release does not constitute an offer to sell or a solicitation of an offer to sell any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

The TSX Venture Exchange has neither approved or disapproved of the contents herein.

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