Redstar Gold Corp.
TSX VENTURE : RGC

Redstar Gold Corp.

January 30, 2006 08:30 ET

Redstar Options Pine Nut Project to SMB

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 30, 2006) - Redstar Gold Corp. (TSX VENTURE:RGC) (the "Company") has a letter agreement with Strategic Merchant Bancorp Ltd (TSX VENTURE:SMB) ("SMB") giving SMB the right to earn up to 70% of the Company's Pine Nut project. This is the second Nevada project SMB has optioned from the Company (see news release dated January 27th, 2006). Redstar believes SMB will be aggressive in exploring both the Pine Nut and Dry Gulch properties with drill programs for both projects planned this spring or early summer.

To acquire a 60% interest in the Pine Nut project, SMB must pay $90,000 in cash, issue 450,000 shares and make expenditures of $2,000,000 over four years. SMB must spend an additional $1,000,000 to earn an additional 10% interest. Redstar will remain as operator during the life of this option agreement.

The Pine Nut project covers a large gold bearing vein system in the Walker Lane belt, in western Nevada. Previous surface work has defined the vein system for over 2.5 kilometres with sampling returning values up to 37.7 g/t gold over 3.0 metres. Only a small portion of the vein system has been explored and a program of surface sampling, structural mapping and diamond drilling is recommended.

The Pine Nut project was acquired based on data made available to Redstar through an exclusive agreement between Redstar and AngloGold Ashanti. This agreement (previously announced Oct. 6, 2005) gives Redstar the exclusive rights to AngloGold Ashanti's entire Nevada database. Redstar is confident that its extensive Nevada database and the Strategic Alliance with SMB will result in a continuous pipeline of projects being developed in Nevada.

Scott Weekes, president of Redstar states: "This second property deal with SMB solidifies our relationship with a very aggressive junior exploration company. Redstar will act as operator in both the Pine Nut and Dry Gulch agreements giving the company control over the technical aspects of the programs. SMB is committed to first phase exploration programs that include drilling. Redstar is actively searching for additional property acquisitions and hopes to have five or six active exploration programs in Nevada. Redstar is moving forward with a strategy of exploration through partnerships in Nevada, with its Strategic Alliance with SMB, and is planning a winter drill program on its 100% owned Newman Todd project in Red Lake."

In connection with this agreement and the agreement announced January 24, 2006, these are not arms length transactions as the Company and SMB have two directors in common.

The foregoing is subject to regulatory acceptance.

On Behalf of the Board,

Redstar Gold Corp

Doug Fulcher, Director

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

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