Tagish Lake Gold Corp.
TSX VENTURE : TLG

Tagish Lake Gold Corp.

September 14, 2005 13:39 ET

Tagish Lake Gold Corp.: Management Comments on the Silver Denominated Debentures

RICHMOND, BRITISH COLUMBIA--(CCNMatthews - Sept. 14, 2005) - Tagish Lake Gold Corp. (TSX VENTURE:TLG) - Overall, the response to the launch of Silver Denominated Convertible Debentures has been positive.

Management believes that it is important to undertake work on the program at Skukum Creek as soon as possible in order to be in position to benefit from the anticipated higher precious metal prices. The Company choose to undertake the Silver Denominated Debenture financing in order to raise the significant amount of funds required for the program leading to production without excessive dilution for existing shareholders. Management has taken the view that the dilution suffered from issuing 50,000,000 shares at C$0.10 per share in order to raise C$5,000,000 is not an option at this time. Since the Company anticipates that it could be in production well before maturity in October 31, 2010, redemption of the Debentures would be funded with cash from the silver produced at Skukum Creek.

As shown on the Balance Sheet, the Company has a Net Asset Value in excess of C$15,000,000. The tangible assets include underground workings at Skukum Creek (also at Goddell Gully and Mt. Skukum), the processing plant and ancillary facilities required for production.

The Silver Denominated Debentures provide the Company with flexibility that is not available with equity financing. If it is attractive, early redemption could also be undertaken from production revenue. Conversion of the debentures is an option available to the Company or the Debenture Holder after the first anniversary. Neither early redemption nor conversion is an obligation, and the debentures do not, therefore, automatically lead to dilution of the stock.

For the investor, the Silver Denominated Debentures offer the opportunity to participate in higher silver prices, while earning interest at a rate that also varies with the price of silver.

Mr. T. Gregory Hawkins, Chairman of the Company stated "Tagish Lake Gold Corp. finds itself at the phase of development that bridges exploration and production. There are not many mineral exploration companies that reach production. As such, we are fortunate in holding a Mineral District that is both a pure exploration play and a mineral deposit that is moving to production.

In the longer term, the future of the company rests with the exciting upside of finding more gold and silver ounces, but the immediate potential must be realized through production from the known resource.

Our position requires that we pursue innovative methods of finance in order to minimize dilution both in the Company's equity and in the interest in the property. Income trusts, royalties and debentures are among the options open to us to secure the financing to move to production while controlling our own destiny. Although this may limit us in terms of the "audience", we feel that it is in the best interests of our loyal shareholders and in the promising future that we believe exists for Tagish Lake Gold Corp."

The Offering is being made through an Offering Memorandum to those persons qualified under applicable securities law in their respective jurisdiction of residence. A copy of the Offering Memorandum and the Subscription Agreement is available by request from the Company at the contact name and address below.

About Tagish Lake Gold Corp.

Tagish Lake Gold Corp. is focused on exploration and development of high grade silver and gold mineral deposits in the Yukon territory of Canada, in particular the Skukum Mineral District (covering 178 km2) that is owned by Tagish. The Skukum Mineral District, located 80 km by road south of Whitehorse, hosts the Skukum Creek silver-gold deposit, and the Goddell Gully and Mt. Skukum gold deposits.

Cautionary Note regarding Forward Looking Statements

This news release includes certain "forward looking statements". Without limitation, statements regarding exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. Factors, such as changes in the world price for precious metals, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements.


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

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