INDIAN RIVER PLACER GOLD MINE CONCLUDES CONSTRUCTION ON-SCHEDULE AND PREPARES  

FOR GOLD PRODUCTION

On July 7th, 2012 the 50/50 joint venture between Klondike Gold Corp. and 46799 Yukon Inc. was formed to operate a placer mining operation on 188 claims on the Indian River in Yukon Territory.  

(See News Release of July 26, 2012).  

Work on the site commenced on July 27th and the company is pleased to announce that in the short period since that date the operating company, KG46 Holdings Ltd., has not only built the complete infrastructure (roads, waterlines, settling ponds, camp) but also purchased and placed the complete 200 cubic-yard-per-hour operating facility (dirt moving equipment, processing plants, power generation, pump stations).  During the process of building the infrastructure selected gravel zones were excavated and approximately 25,000 m3 of gravels were stockpiled as pay dirt. Processing some of the material from that stockpile resulted in the recovery of approximately $70,000 worth of gold which, excluding any capital costs, substantially covers the costs of developing the infrastructure. The efficient completion of this work allows the company to sluice more material and fine tune operations over the next few weeks while assuring full production at start up of the 2013 season.

The Indian River Placer Project compliments the Company's near-by Lonestar Gold Project where the Company is compiling, for the first time, all available geological data that enhances the understanding as to the gold source of the very rich placer claims made famous by the Klondike Gold Rush of 1896.