Kestrel Gold Inc. Announces Completion of Acquisition of Condoryacu and Maria Amalia Properties in Argentina

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Kestrel Gold Inc. ("Kestrel" or the "Corporation") (TSX VENTURE:KGC) is pleased
to announce that it has completed the previously announced acquisition of a one
hundred percent (100%) interest in the mineral rights to the Condoryacu and
Maria Amalia mining concessions (the "Properties") in North-western Argentina
(the "Acquisition"), subject to post closing registrations. 


As stated in news releases of the Corporation dated December 11, 2011 and
January 16, 2012, the Corporation, through its wholly owned subsidiary Rio
Diablillos S.R.L, has acquired from Condoryacu S.R.L. (the "Vendor") a one
hundred percent (100%) interest in the Properties in exchange for cash
consideration in the aggregate amount of USD$4,000,000 to be paid over a period
of 36 months, subject to completion of registration of various transfers of
titles to the Properties in Argentina which are anticipated to be completed by
mid March, 2012. The Corporation has also granted to the Vendor a net smelter
royalty equal to 1.5% of the net smelter returns from production of metals from
the Properties.


Highlights of Properties 

The Properties, consisting of approximately 400 hectares, are located in
northwestern Argentina in the physiographic region known as the "Puna",
characterized by a high plateau and an arid desert climate that facilitates
almost year-round mineral exploration and access by four-wheel drive vehicles.
Salta, approximately 150 kilometres east-north-east, is the nearest significant
sized city and has daily air service by several carriers.


At the Properties, the main mineralized zone comprises a low outcrop of strongly
silicified and locally brecciated granodiorite. Vuggy, intensely silicified
(often chalcedonic) and locally brecciated fault controlled zones exhibit high
grade gold, silver and copper mineralization. Limonite, malachite and pyrite are
present, with the sulphides at surface being mainly oxidized.


High grade, at surface precious metal and copper mineralization is believed to
be related to a complex structural environment that separates the areas referred
to as the Northern Outcrop and Southern Outcrop - the two most important regions
of the Condoryacu property found to date, which are some 300 metres apart. 


In April 2011, Kestrel collected three selective check surface grab samples that
returned up to 30.93 g/t Au and greater than 200 g/t Ag in sheared silica and
clay altered breccia from the "Southern Outcrop" and collected a selective check
surface grab sample at the "Northern Outcrop" of silica and clay altered
brecciated quartz feldspar porphyry, that returned 4.63 g/t Au. 


Drill programs in the early 2000's, were carried out by Cardero Resource Corp.
and Maximus Ventures Ltd. at the Southern Outcrop, which have returned estimated
true thicknesses of up to 12.23 metres of 14.15 g/t Au, 129.3 g/t Ag. 


Drill hole CY01-01A drilled down plunge intersected 76.39 metres of 18.03 g/t
Au, 115.3 g/t Ag and 2.16% Cu. This result indicates continuous mineralization
from surface to a depth of at least 75.2m below collar.


The mineralized zone has been demonstrated to extend from surface to a depth of
110 metres and is open at depth.


The Properties lie approximately 2 kilometres south-southwest of "Diablillos",
an advanced gold-silver project owned by Silver Standard Resources Inc.
currently at pre-feasibility mine stage. Kestrel believes that the structural
features controlling the distribution of gold-silver and base metals are related
in the two regions. 


About Kestrel Gold Inc.

Kestrel is a gold exploration company headquartered in Canada. Its two principal
projects are the King Solomon's Dome property in Canada's Yukon Territory and
the Huachi property in Argentina. Kestrel (KGC) is listed on the Exchange. 


Technical aspects of this news release have been reviewed and approved by
William Taylor, P.Geo., designated as a qualified person under National
Instrument 43-101.


Cautionary Statements

This news release contains "forward-looking information" within the meaning of
applicable securities laws. These statements relate to future events or future
performance. The use of any of the words "could", "intend", "expect", "believe",
"will", "projected", "estimated" and similar expressions and statements relating
to matters that are not historical facts are intended to identify
forward-looking information and are based on the Corporation's current belief or
assumptions as to the outcome and timing of such future events. Actual future
results may differ materially. In particular, this release contains
forward-looking information relating to the completion of registration of the
transfers of the Properties with Argentina authorities. Various assumptions or
factors are typically applied in drawing conclusions or making the forecasts or
projections set out in forward-looking information. Those assumptions and
factors are based on information currently available to the Corporation. The
material factors and assumptions include that the transfers will be registered
by the required authorities in Argentina in a timely fashion. Risk Factors that
could cause actual results or outcomes to differ materially from the results
expressed or implied by forward-looking information include, among other things
failure to complete the registrations in a timely fashion. The Corporation
cautions the reader that the above list of risk factors is not exhaustive. The
forward-looking information contained in this release is made as of the date
hereof and the Corporation is not obligated to update or revise any
forward-looking information, whether as a result of new information, future
events or otherwise, except as required by applicable securities laws. Because
of the risks, uncertainties and assumptions contained herein, investors should
not place undue reliance on forward-looking information. The foregoing
statements expressly qualify any forward-looking information contained herein.