Redstar Gold Corp.

Redstar Gold Corp.

January 18, 2012 08:00 ET

Redstar Identifies New High-Grade Gold Vein System With 94.7 g/t Au and 1840 g/t Ag at Surface, Unga Project Alaska

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 18, 2012) - Redstar Gold Corp. (TSX VENTURE:RGC) is pleased to report surface sample results from the Unga Project in western Alaska. In the fall of 2011, Redstar completed its first round of drilling and surface exploration on the Unga project with initial drill results confirming a high-grade, bonanza type gold system at the Shumagin target. As reported in late 2011, highlights from the ten core holes drilled on the Shumagin include wide zones of gold mineralization, such as 21 metres of 4.02 g/t gold containing a bonanza-grade interval of 1.0 metre of 43.90 g/t gold in hole 7, and 30 metres of 14.98 g/t gold containing 738 g/t gold over 0.55 metres in hole 10. Additional surface sampling of several other areas returned significant gold assays over a broad area, including 13.2 g/t Au over 2 metres with an internal vein separate containing 94.7 g/t gold at the historic Sitka mine. Additionally reconnaissance exploration several kilometers to the northwest of the Shumagin system in the Zachary Bay target defined what appears to be a major copper-gold porphyry system with a historic trench for the 1970's returning 46 metres of 0.36% copper and 0.550 g/t gold. Redstar is currently compiling all historic exploration and geologic data from the project ahead of a major exploration program planned for this summer.

Sitka Gold Vein System

The Sitka gold vein system is part of the extensive +5,000-foot long Apollo-Sitka vein system about 3.2km south of the Shumagin gold vein on the southern part of the Unga Island. Historic work at Sitka included underground development to 250 feet below surface, with 7,000 tons of ore reportedly mined and included within the overall Apollo-Sitka production of 500,000 tons grading approximately 10 g/t gold. Historic reports document shallow high-grade gold mineralization, including 2,000 tons grading 18.6 g/t gold above the 60-foot level and 8,150 tons grading 4 g/t gold between the 150 and 250 foot levels. These tonnages are based upon limited drifting of less than 750 feet along the vein. In 2011, Redstar collected several samples from the area of the historic shaft and obtained high-grade Au-Ag values across the vein of 13.2 g/t Au and 398 g/t Ag over 2metres** in outcrop that includes a vein which assayed 94.7 g/t Au and 1840 g/t Ag. Also, a sample of vein material from the mine dump returned 15.2 g/t Au and 316 g/t Ag. Mineralization occurs in an east-northeast-trending galena-rich quartz vein stockwork zone within volcanic rocks. The width of the mineralization is not known; however, an extensive quartz-stockwork vein zone is exposed in a series of trenches indicating a minimum width of at least 50 metres. Modern exploration work at Sitka is limited to an early 1980's effort by Alaska-Apollo Gold Mines, who completed underground sampling and drilling of an unknown number of holes. High-grade mineralization was reported, including 31.82 g/t gold over 1.8 metres on the 150 level, 15.08 g/t gold over 1 metre in one of the trenches and 22.63 g/t gold over 0.6 metres in a drillhole from the 150 level (The Mining Record, July 7, 1982 and September 7, 1983). Redstar has not been able to verify these results, but they are consistent with Redstar's limited sampling completed in 2011.

Zachary Bay Copper-Gold Porphyry System

The Zachary Bay porphyry copper-gold target is located approximately 7 kilometres northwest of the Shumagin gold vein. Surface rock-chip sampling in 1974 returned 46 metres of 0.36% copper and 0.550 g/t gold. Four shallow (<120 metres) drillholes completed in 1975 by Quintana Minerals Corp and Duval Corp intersected disseminated Cu-Au mineralization in intrusive rocks. The deepest drillhole (Z1, 117 metres) was mineralized over its entire length, with 107 metres grading 0.11% copper and 0.280 g/t gold. These assays were completed by Resource Associates of Alaska in 1981, who re-assayed the original core. Samples of the core are preserved at the Alaska Division of Geological and Geophysical Surveys's Geologic Material Center at Eagle River, Alaska, and were inspected by Redstar. The core samples are consistent with classic porphyry copper-gold mineralization, with abundant disseminated hydrothermal biotite, magnetite and chalcopyrite within a quartz-diorite intrusion with pink potassium feldspar phenocrysts. The strong correlation between copper and gold is also indicative of a porphyry system. There has been no exploration at Zachary Bay since 1975. Redstar plans to aggressively evaluate the area in 2012.

Scott Weeks, Redstar Gold Corp. CEO states, "In addition to aggressively exploring outcropping gold systems, Redstar has been compiling historic exploration results from the 1970-80's to develop an integrated, district-wide geochemical, geological and geophysical model. This represents the first time the large and generally unexplored Unga District has been assessed in its entirety. Given the very encouraging early drill and surface sampling results, the system looks very promising for hosting a major new gold or copper-gold deposit. Redstar will aggressively explore the Unga project and its many targets in 2012."

Key Information from Ongoing Data Completion

  • Compilation of district-wide geophysics shows prominent linear magnetic lows coincident with and extending beyond known mineralized vein systems and their surface expressions.
  • Definition of the Centennial gold deposit (4.34 million tonnes grading 1.44 g/t*) on Popof Island with significant expansion potential. Two kilometers southeast of the Centennial gold deposit, high-grade gold mineralization occurs in quartz veins that have not been drilled, with underground sampling in 1982 returned 21.39 g/t gold over 0.6 metres and 16.11 g/t gold over 0.6 metres. These veins project into the Centennial deposit and could be the feeder system.
  • High-level porphyry related alteration in volcanic rocks has been mapped at Red Cove 5 kilometres southeast of Centennial. Five shallow drillholes completed in 1989 failed to test the porphyry Cu-Au target at depth.
  • An extensive vein system refered to as Norm's Vein 3.7 kilometres northwest of the Shumagin gold vein contains realgar (gold system indicator) and strong hydrothermal alteration over at least one kilometre of strike length. The area has seen limited exploration in the early 1980's, but historic assays returned values to 1.4 g/t gold.

Unga Project

The Unga Project covers approximately 250 square km and contains numerous gold occurrences. In addition to the Shumagin Vein, the project contains the historic Apollo-Sitka mine area, where approximately 150,000 oz of high-grade gold was produced between 1891 and 1922, and the Centennial disseminated gold deposit, which contains a non NI 43-101 compliant resource of 4.35 million tonnes grading 1.5 g/t gold. The Unga Project consists of two properties acquired by Redstar in 2011: the Shumagin Property and the Unga-Popof Property. Redstar is purchasing a 100% interest in the Shumagin Property from Magnum Hunter Resources. The mineral rights to the Unga-Popov Property are held by Full Metal Minerals Inc. under a lease agreement with The Aleut Corporation, an Alaska Native Regional Corporation headquartered in Anchorage, Alaska. Redstar has signed an agreement with Full Metal, giving Redstar the right to earn a 60% in the property by completing $5 million in exploration expenditures by August 1, 2015, making cash payments of $300,000 by August 1, 2014, and issuing 1,000,000 shares by August 1, 2014. Redstar has the option of earning an additional 15% interest by producing a bankable feasibility study and issuing an additional 1 million shares to Full Metal. Redstar will issue an additional 1 million shares in the event of commencement of commercial production. In addition Redstar is finalizing the formal agreement with Full Metals which includes the surface rights held by the Unga Corporation.

Dr. Jake Margolis and Bob Singh P.Geo are the qualified persons as defined by National Instrument 43-101 and have reviewed this news release. Dr. Margolis is the US Exploration Manager for Redstar Gold Corp. and Mr. Singh is the Canadian Exploration Manager for Redstar Gold Corp.

* A qualified person has not done sufficient work to classify the historical estimate as current mineral resources, the issuer is not treating the historical estimate as current mineral resources and the historical estimate should not be relied upon.
** Does not necessarily represent true width of the zone

About Redstar Gold Corp.

Redstar has fourteen gold projects in Nevada, the Unga project in Alaska and the Newman Todd project in the Red Lake district, Ontario. The Unga Project in Alaska includes the high-grade Shumagin gold deposit, the Centennial disseminated bulk-tonnage gold deposit and the Apollo-Sitka high-grade gold vein system, which produced approximately 150,000 oz of gold in the early 20th century. The Newman Todd project contains a 2 km-long corridor of high-grade gold vein mineralization that is similar to that at the nearby world-class Red Lake Mine and has been the focus of an aggressive drilling campaign in 2011. In Nevada, several projects are undergoing active exploration by partners including Newmont Mining Corp. and Centerra Gold Inc.

Redstar would also like to report that Mr. Raymond Mullaney has resigned as a director of the Company due to a business conflict. Mr. Mullaney has served on the board of Redstar since 2009. The Board of Directors wishes to thank Mr. Mullaney for his contribution and service to the Company.

On Behalf of the Board,

Redstar Gold Corp.

Scott Weekes, President

Forward-Looking Information: This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address events or developments that Redstar Gold Corporation (the "Company") expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, and continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. Except as required by applicable securities laws, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.

Neither 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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