Kootenay Drills 146 gpt Silver eqv over 234m as 10,000 Meter Drill Program Concluded; Major 25,000 Meter Multi-Phase In-Fill Drilling and Resource Definition Program to Commence at Promontorio Silver Project

Tuesday,31 May 2011Kootenay Gold Inc.

http://www.kootenaygold.ca/s/NewsReleases.asp?ReportID=459865&_Type=News-Releases&_Title=htmlFONT-COLORFF6600bPROMONTORIO-bfonthtmlKootenay-Drills-146-gpt-Silver-eq...

Vancouver, B.C. - Kootenay Gold Inc. TSX.V: KTN ("Kootenay")is pleased to announce it has successfully concluded the final holes ofits 10,000 meter drill program on its Promontorio Silver project inSonora, Mexico, highlighted by a 234 meter intersection grading 146 gpt silver equivalent*.Based on the success of the 10,000 meter program Kootenay reports ithas entered into a contract with BDW Drilling to immediately commence aminimum 25,000 meter multi-phase diamond drill program at Promontorio.The in-fill drilling and resource definition program will be theCompany's single largest and most expansive drill campaign everconducted at Promontorio.

*See 10,000 meter drill highlights below - Visit www.kootenaygold.ca for complete Drill Results and Map

States James McDonald, President and CEO of Kootenay: "Hittingexcellent grades of silver mineralization over a broad 234 meter intersection is further testimony to the success of our 10,000 meter drilling program on Promontorio. Paramount to its success, we confirmed that high and medium grade silver occurs along the entire 1.0 kilometer long mineralized corridor that hosts the current resource. Equally important broadly spaced holes indicate continuity of silver mineralization over 300 meters of strike in the North East Zone, which is double the strike length of our current 43-101 silver resource."

25,000 Meter Multi-Phase Drilling Program to Commence

Kootenay reports final mobilization is underway in preparation for the current multi-phase program. Drilling is scheduled to commence with two drills June 2, 2011 and will continue into the fall 2011. With the planned addition of a third rig, a total of three diamond core drills will be working on site and a minimum of 25,000 meters of drilling is budgeted. The program is designed to substantially expand the current43-101 resource conducted on the project by AGP Mining Consultants in2010. Included in the program will be extensive infill and step out drilling to define continuity between silver intercepts and to test the limits of silver mineralization.

Further adds McDonald "Clearly, the upcoming 25,000 meter drill program is a major step forward and a much anticipated milestone in the development of Promontorio. A primary focus for the program will be to dramatically boost the size of our current silver resource with in-fill and step out drilling within multiple zones of widespread silver mineralization identified outside of the Pit Resource along Promontorio's 1.0 kilometer long mineralized corridor. More than 55 holes will be dedicated to these areas."

Drilling will test new areas of mineralization and test the current resource boundaries at depth where previous drilling bottomed out in silver mineralization. Infill drilling will also focus on establishing the continuity and size of the high and medium grade silver domains now established within and outside of the silver resource.

Updated NI 43-101 Resource Calculation to Commence at Conclusion of Program

Kootenay reports an updated NI 43-101 resource calculation on Promontorio is planned to commence at the conclusion of the program. In anticipation of further advancing the development of Promontorio, theCompany reports preliminary work for baseline, further metallurgical and scoping studies will be initiated concurrent with the drilling program.

Highlights of Mineralized intercepts include:

*Note: PC denotes RC holes and DH denotes core holes. All holesshould be taken in context of their locations which are given in table and map form on the Company website. All silver equivalent values are calculated using silver + lead + zinc at $15.00/ oz,
.97/lb. Pb and
.91/lb. Zn respectively

Highlights of final holes of 10,000 meter drill program include:

PC 53

• 234 meters of 146 gpt Ag equivalent including; 70 meters of 236.3 Ag equivalent including 27 meters of 338.6 gpt Ag equivalent or 121.7 gpt Ag and 5.50 % Pb +Zn.

PC 52

• 10.5 meters of 174.2 gpt Ag equivalent or 64.1 gpt Ag and 2.57 % Pb +Zn.

PC 48

• 92 gpt Ag equivalent over 90 meters including 39 meters of 153.2 gpt Ag equivalent or 63.7 gpt Ag and 2.08 % Pb +Zn.

PC 50

• 76.5 meters of 61 gpt Ag equivalent or 24 gpt Ag and 0.87 % Pb +Zn

PC 47

• 36 meters of 82 gpt Ag equivalent including 12 meters of 183.9 gpt Ag equivalent or 125.5 gpt Ag and 1.36 % Pb +Zn.

Details of the 10,000 meter drill program are as follows:

Pit Zone and Area

Hole DH 53

• Grading 234 meters of 146 gpt Ag equivalent or 58 gpt silver 2.06% Pb +Zn.
• Includes 70 meters of 236.3 Ag equivalent or 91.4 gpt Ag and 3.37 % Pb +Zn and 27 meters of 338.6 gpt Ag equivalent or 121.7 gpt Ag and 5.50 % Pb +Zn.
• DH 53 is an infill hole within the resource drilled to better define the hangwall and footwall contacts and to test the extension of high grade zones within the resource. It shows significant extensions to the high grades. For example:
  • the internal intercept of 236gpt silver equivalent over 70 meters is a 25 meter step out from KP 25 that hit 100.4 gpt silver and 3.24% Pb+Zn over 97.67 meters within a wider intercept of 62.4 gpt silver and 2.1% Pb +Zn (see news release dated July 22, 2008) and a 80 meter step out from KP 26 where 87.11 gpt silver and 2.93 % Pb+Zn over 29.90 meters occurs within a wider lower grade intercept of 36.94 gpt silver and 1.31 % Pb+Zn over 187.8 meters (see news release dated July 22, 2008).
  • Further it indicates good potential for an un-quantified higher grade domain. This holds potential for upgrading the resource size internally and may of course have a positive impact on project economics.

PC 48

• Encountered 92 gpt Ag equivalent over 90 meters or 38 gpt Ag, 1.36 % Pb +Zn including 39 meters of 153.2 gpt Ag equivalent or 63.7 gpt Ag and 2.08 % Pb +Zn. Mineralization started at 45 meters.
• PC 48 tested the northeast Pit Resource extension with a 20 meter off set to the northeast.

PC 47

• Encountered 36 meters of 82 gpt Ag equivalent or 54 gpt Ag and 0.65% Pb +Zn including 12 meters of 183.9 gpt Ag equivalent or 125.5 gpt Ag and 1.36 % Pb +Zn. Mineralization started at 24 meters.
• PC 47 tested the northeast Pit Resource extension with about a 70meter step out.

PC 49 did not reach target depth and bottomed in weakly anomalous mineralization at 156 meters.

PC 50

• Intersected 61 gpt Ag equivalent over 76.5 meters or 24 gpt Ag and 0.87 % Pb +Zn. Drilled about 75 meters northeast of the Pit Resource.

PC 51 No significant results.

PC 52

• Intersected 10.5 meters of 174.2 gpt Ag equivalent or 64.1 gpt Ag and 2.57 % Pb +Zn.

Pit South West Area:

PC 12

• PC 12 was deepened with core extending the mineralized zone a further 44 meters of hole length for a composited interval of 36 gpt Ag, 0.62 % Pb and 0.68 % Zn for 92 gpt Ag equivalent over 114.5 meters.

PC 11

• PC 11 was deepened with core extending the mineralized zone a further 89 meters of hole length for a composited interval of 12 gpt Ag, 0.18 % Pb and 0.20 % Zn for 28 gpt Ag equivalent over 150 meters.

North East Zone and Trend

PC 30 through PC 38 were drilled along the northeast trend betweenthe Pit Resource and the North East Zone. These holes did not reachplanned depths with PC 35, 36, and 37 just beginning to enter the target zones. These targets will be tested with core drilling which has a much higher success rate at Promontorio.

PC 30 to PC34 did not reach target depth, no significant results.

PC 35 did not reach target depth bottoming in anomalous mineralization at 294 meter depth with the best intercept being 6 meters of 92.4 gpt Ag equivalent or 42.3 gpt silver and 1.16% Pb+Zn.

PC 36 did not reach target depth but bottomed in anomalous mineralization at 264 meters with the best intercept being 48 meters of 20.6 gpt Ag equivalent or 14 gpt Ag and .15% Pb +Zn

PC 37 bottomed in 12 meters of 93.4 gpt Ag or 38.3 gpt Ag 1.294 % Pb+Zn.

PC 38 and PC 29 no significant interval.

Ranch EM Anomaly

Holes PC 39 through to PC 46 were shallow RC holes drilled to test a peripheral target called the Ranch EM zone. It is outside of the main mineralized 1.0 kilometer long corridor and was tested to take advantage of the RC rig before it was released from the project. These holes showed:

PC 39 intersected 4.5 meters of 307.7 gpt Ag equivalent or 101.3 gpt silver and 6.3 % Pb+Zn.This was drilled about 80 meters and in the opposite direction of previously released KP 64 which hit 3.0 meters of 551 gpt Ag and 20.27%Pb + Zn.

PC 40 to 46 hit no significant mineralization.

QA/QC

All holes marked PC were drilled using reverse circulation and marked DH were drilled with HQ core. RC samples were split using riffle orrotary splitters to make representative composites. All samples are over1.5 meter intervals. Core samples were cut using a core saw at 1 to 2meter intervals. All mineralized intercepts are drill hole lengthdrilled across a vertically inclined breccias system at 60 degreeangles. Further Quality Assurance and Quality Control procedures areposted on the Kootenay Gold website.

The foregoing geological disclosure has also been reviewed andverified by Kootenay's CEO, James McDonald, P.Geo (a qualified personfor the purpose of National Instrument 43-101, Standards of Disclosurefor Mineral Projects). Mr. McDonald is a director of Kootenay.

ABOUT KOOTENAY

Kootenay Gold is actively developing mineral projects in the SierraMadre Region of Mexico and in British Columbia, Canada. The Company'sflagship property is the former producing Promontorio Silver mine inSonora State, Mexico. The Company's objective is to develop near termdiscoveries and long term sustainable growth. Kootenay's management andtechnical team are proven professionals with extensive internationalexperience in all aspects of mineral exploration, operations and venturecapital markets. Multiple, ongoing J/V partnerships in Mexico andCanada maximize potential for additional, new discoveries whilemaintaining minimal share dilution