KGC Kestrel Gold Inc

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UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A
VIOLATION OF U.S. SECURITIES LAWS.


Kestrel Gold Inc. ("Kestrel" or the "Company") (TSX VENTURE:KGC) is pleased to
announce that it has entered into a binding letter of intent (the "LOI") with
respect to the acquisition of an option (the "Option") to earn an undivided one
hundred (100%) percent interest in 12 properties (the "Properties") totalling
approximately 22,065 hectares, from Bernie Kreft ("Kreft" or the "Optionor").


The Properties

The Properties that are to be acquired pursuant to the LOI are located in
British Columbia (nine (9) properties and thirty eight (38) Mineral Title
Tenures) and the Yukon Territory (three (3) properties and six hundred and
twenty four (624) Quartz Claims). The Properties range from being grassroots to
very close to drill ready in exploration status, and cover targets that include
epithermal, intrusion-related and orogenic gold types as well as porphyry copper
type models.


The more advanced projects include Ten Mile Creek, Clear Creek and Barney Ridge,
all of which are located in the Yukon beside placer gold mining camps. The Yukon
projects lie within the prolific gold producing Tintina gold province, home to
the large Alaskan gold mines and deposits such as Fort Knox, Pogo and Donlin
Creek. Vallaeu Creek, in central British Columbia is situated in the Quesnel
Trough, a regional geological Terrane belt extending from southern to northern
British Columbia hosting many of the provinces larger gold and copper deposits.


An initial geological compilation of existing exploration data for all Yukon and
British Columbia Properties has begun and prioritized field exploration is
expected to commence shortly. In addition, the Properties will have an area of
common interest surrounding them, whereby the Company will pay the Optionor all
costs associated with the acquisition of additional mineral properties within
the area. 


The Acquisition

Subject to the terms of the LOI and upon entering into a definitive option
agreement (the "Definitive Agreement") between the Company and Bernie Kreft,
Kestrel will be granted the exclusive Option to acquire a one hundred (100%)
percent interest of all mineral rights in respect of the Properties. To fully
exercise the Option, Kestrel will be required to issue an aggregate of
11,100,000 common shares in the capital of the Company ("Common Shares") to the
Optionor and to make staged payments totalling $500,000 to the Optionor to be
used for exploration programs on the Properties. Upon exercise of the Option,
the Optionor shall receive a 1.5% NSR on each of the Properties, 0.75% of which
can be purchased by the Company for $1,000,000 (other than with respect to the
NSR on the Ten Mile Creek property).


The cash payments are to be made in two separate instalments of $250,000, the
first instalment to be paid on or prior to the first anniversary of the
effective date of the Definitive Agreement and the second instalment on or prior
to the third anniversary of the effective date of the Definitive Agreement.


The Common Shares are to be issued to the Optionor in three separate instalments
of 3,700,000 Common Shares, to be paid on or prior to each of: (i) the execution
of the Definitive Agreement; (ii) January 31, 2015; and (iii) the first
anniversary of the effective date of the Definitive Agreement. The Common Shares
will be subject to a four (4) month hold period from the date of issuance.


Kevin Nephin, the Company's Chief Executive Officer, states: "Having worked with
Bernie over the past 4 years on other projects we are very excited to solidify
our relationship with him by moving ahead with this acquisition. Bernie is one
of Canada's top prospectors. His work ethic, discipline, prospecting abilities
and big picture approach are ingredients critical to the discovery of new
deposits, highlighted by his numerous previous industry successes. Working with
Bernie and his team will allow Kestrel to quickly and effectively explore these
highly prospective Properties in a cost effective manner."


Bernie Kreft states, "I look forward to working with Kevin and the Kestrel team.
Combining Kestrel's financial and geological support with my prospecting and
field exploration skills should yield an aggressive acquisition as well as
discovery-based mineral exploration company."


The acquisition of the properties is subject the parties entering into the
Definitive Agreement and the receipt of all required regulatory approvals,
including the acceptance of the TSX Venture Exchange ("TSXV"). The acquisition
will constitute a "reviewable transaction" pursuant to the policies of the TSXV
and as such, TSXV approval will be subject to a review by the TSXV of the
proposed acquisition and may include the requirement for a title opinion on the
properties and the provision of NI 43-101 compliant technical reports with
respect to the Properties. In accordance with Exchange policy, the Common Shares
are currently halted from trading and will remain halted until further notice.


Effect of Acquisition on Outstanding Securities of Kestrel

Kestrel currently has 11,095,842 Common Shares issued and outstanding. Upon
closing of the acquisition, the Company will be required to issue 3,700,000
Common Shares to Mr. Kreft, which represents approximately 33% of the currently
outstanding Common Shares.


In addition, further to the news releases of the Company dated April 21, 2014
and May 1, 2014, the Company plans to complete non-brokered private placement of
up to 10,000,000 units of the Company (the "Private Placement") and to issue an
additional 500,000 Common Shares as payment of certain debts of the Company (the
"Debt Settlement"). Assuming the completion of the acquisition, the completion
of a fully subscribed Private Placement and the completion of the Debt
Settlement, the Company will have up to a total of 21,595,842 Common Shares
outstanding at the time of completion of the acquisition, of which Mr. Kreft
will hold approximately 17%. 


In order to exercise the Option, the Company will be required to issue Mr. Kreft
up to a total of approximately 50% of the outstanding Common Shares, excluding
the Private Placement and Debt Settlement, which amounts to approximately 34% of
the Common Shares assuming completion of a fully subscribed Private Placement
and Debt Settlement and no other issuances of Common Shares.


In the event that Mr. Kreft will acquire greater than 20% of the outstanding
Common Shares as of the date of closing of the acquisition of the Option, the
Company will be required to obtain the consent of at least 50% of the
shareholders of the Company pursuant to the policies of the TSX Venture
Exchange.


Bernie Kreft

Mr. Kreft has been a full time prospector in the Yukon Territory since 1988. He
manages an active and aggressive family run exploration and development company
with numerous projects throughout British Columbia and the Yukon. Mr. Kreft has
a history of acquiring and advancing mineral prospects ranging from grassroots
to advanced projects, and has made several mineral discoveries over the course
of his career. In addition, Mr. Kreft has years of experience in the area of
placer mining. Bernie was named Yukon Prospector of the Year for 1998 by the
Yukon Prospectors Association.


About Kestrel Gold Inc.

Kestrel Gold Inc. is a gold exploration Company headquartered in Canada. Kestrel
(KGC) is listed on the TSX Venture Exchange and explores primarily for gold in
Canada. The Company has ongoing exploration projects in the famed Klondike Gold
Fields just south of Dawson City, Yukon Territory.


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


For further information, please visit our website at www.kestrelgold.com.

Cautionary Statements

This news release contains "forward-looking statements" within the meaning of
applicable securities laws relating to the acquisition of the Properties, the
completion of the Private Placement and the Debt Settlement, and the future
interest of Mr. Kreft in the Company. Readers are cautioned to not place undue
reliance on forward-looking statements. Forward-looking statements are based on
certain key assumptions made by the Company, including assumptions regarding the
satisfaction of conditions and completion of the acquisition, the ability of the
Company to raise maximum amount pursuant to the Private Placement, the
satisfaction of the conditions to the completion of the Debt Settlement, the
receipt of all regulatory and stock exchange approvals related to the
acquisition, the Private Placement and the Debt Settlement and with respect to
the future proposed exploration activities on the Property. Actual results and
developments may differ materially from those contemplated by these statements
depending on, among other things, the risks that the transactions will not be
successfully completed for any reason, including the failure to obtain the
required approvals or clearances from regulatory authorities, stock exchanges
and shareholders or the failure by any party to complete the acquisition, the
Private Placement or the Debt Settlement on terms acceptable to the Company. The
forward-looking statements in this news release are made as of the date of this
release and the Company undertakes no obligation to update publicly or revise
any forward looking statements whether as a result of new information or
otherwise, except as required by applicable securities laws. The Company
undertakes no obligation to comment on analyses, expectations or statements made
by third-parties in respect of the Company or its financial or operating results
or (as applicable) their securities.


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


FOR FURTHER INFORMATION PLEASE CONTACT: 
Kestrel Gold Inc.
Kevin Nephin
President & CEO
(604) 824-6056
kvnephin@gmail.com
www.kestrelgold.com

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