Kestrel Gold Inc. Announces Private Placement Of Up To $4,000,000

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VIOLATION OF U.S. SECURITIES LAWS.


Kestrel Gold Inc.("Kestrel" or the "Corporation") (TSX VENTURE:KGC) is pleased
to announce that the Corporation proposes to complete a non-brokered private
placement of up to 10,000,000 units ("Units") of the Corporation at a purchase
price of $0.40 per unit for total proceeds of $4,000,000 (the "Offering"). Each
Unit shall consist of one common share in the capital of the Corporation
("Common Share") and one half of one Common Share purchase warrant of the
Corporation ("Warrant"). Each full Warrant will be exercisable into one Common
Share at a price of $0.60 per Common Share for 12 months from the date of
issuance subject to earlier expiry in certain circumstances. 


The closing of the Offering is expected to occur prior to the end of February,
2012 and is subject to the completion of formal documentation and receipt of
regulatory approval, including the conditional approval of the TSX Venture
Exchange Inc. (the "Exchange").


If at any time prior to the expiry of the Warrants the trading price of the
Common Shares on the Exchange exceeds $0.80 for a period of 20 consecutive
trading days, the Corporation may, in its sole discretion, within five (5) days
after such an event, provide notice (a "Notice") to the warrant holders of early
expiry of the Warrants. The Notice would provide that the Warrants would expire
at 3:30 p.m. (Calgary time) on the date which is twenty one (21) days after the
date of the Notice.


Kestrel intends to use the proceeds from the Private Placement to fund a portion
of its exploration activities with respect to its mining properties in Argentina
and the Yukon Territory and for other working capital requirements.


In certain instances, the Corporation may pay finder's fees to eligible persons
on a portion of the Offering consisting of a cash payment equal to 7% and the
issuance of finder's warrants ("Finder's Warrants") equal to 7% of the gross
proceeds raised from applicable subscriptions in the Offering. Each Finder's
Warrant will entitle the holder to acquire one additional Unit at a price of
$0.40 for 12 months following the date of issuance. 


All Common Shares, Warrants, Finder's Warrants and any Common Shares into which
such securities may be converted shall be subject to a four (4) month hold
period from the closing date of the Offering. 


About Kestrel Gold Inc.

Kestrel is a gold exploration corporation 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. 


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 and timing of the
Offering and the use of proceeds of the Offering. 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 management will be able to raise
gross proceeds of $4,000,000, that the Corporation will obtain all necessary
regulatory approvals and that the board of directors will not determine that it
is in the best interests of the Corporation to change the intended use of
proceeds. 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: the failure to obtain the required approvals to the
Acquisition in a timely fashion or at all, general economic conditions and
market risks relating to the mining industry.. 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.