Klondike Gold Reports Lone Star Property Rock Sample Assays

Vancouver, British Columbia, January 14, 2015, Klondike Gold Corp. (TSX.V:KG) (“Klondike Gold” or the “Company”) announces recently received rock assays from 212 prospecting samples on the Lone Star Property collected during the 2014 field program as part of a broader program evaluating the Lone Star, Dominion, and Gold Run Properties totalling 22,500 hectares area located near Dawson, YT, Canada.  Klondike Gold owns a 100% interest in 1,228 quartz claims and 14 crown grants covering the western half of the Klondike placer goldfields.

Summary:

• Prospecting samples at the Boulder Lode prospect from a newly uncovered quartz vein (“Vein 1”) yield gold assays of 1,766 g/t Au, 1,007 g/t Au, and 831 g/t Au with corresponding silver assays of 400 g/t Ag, 237 g/t Ag, and 205 g/t Ag respectively. (Prospecting samples are selective in nature; systematic test results may vary significantly.)
• Prospecting samples of bedrock quartz veins from the Nugget to Buckland prospect areas assayed between 1.0 g/t Au and 19.4 g/t Au including six samples with visible gold identified in outcrop.
• Prospecting identified 19 geographically diverse previously undocumented sites of visible gold in outcropping bedrock quartz veins.
• Analysis of historical aeromagnetic surveys from Klondike Gold and the Geological Survey of Canada (“GSC”) has identified a shear fault array comprised of a main dextral shear fault with associated secondary pinnate and horsetail extensional faults interpreted to transect the Klondike goldfields.  Portions of this fault network have been identified previously as “D4” faults and this fault array appears to be a primary control on “D4” gold-bearing quartz veins in Klondike area.

Regional Structure:

In 2014, Klondike Gold recognized and field mapped a new shear fault array of regional importance.  This fault array was identified through the analysis of historical detailed airborne magnetic surveys flown by Klondike Gold over small portions of the Company’s Lone Star and Dominion Claim Blocks, in 1987, 1996, and 1999. By integrating these surveys with a regional aeromagnetic survey flown for the GSC in 2000 (500m line spacing), Klondike Gold’s geologists were able to identify and extend portions of the fault network throughout the Klondike region. Follow up field mapping at Lone Star and Dominion Properties demonstrates that portions of this fault network, ascribed by academic and government geologists as so-called “D4” faults, are extensional in nature and are thought to control the emplacement of Klondike area gold-enriched “D4” age veins.

Prospecting:

Prospecting in 2014 was guided by interpreted magnetics and investigated areas of faulting, with the objective of documenting gold-enriched quartz veins and distinguishing them from unmineralized quartz and carbonate veins.  A total of 212 prospecting samples of all rock types were collected throughout the 182 square kilometer Lone Star Property and submitted for analysis following the end of the field season.  Thirty of these prospecting samples had a gold assay result ranging from greater than 1 g/t Au to 1,766 g/t Au.

Historically over the past ten years, workers had documented six individual sites containing visible gold from nine samples.  During 2014, prospectors identified 21 new sites of visible gold in outcropping bedrock quartz veins.

Boulder Lode aka “Lone Star Mine” Area:

The Boulder Lode prospect was staked in 1897, excavated and explored between 1898 and 1903, then developed with an open-cut 105 meters long and 10 meters deep and underground to a vertical depth of 30 meters with 225 meters of lateral drifting and mined between 1909 and 1914.  Historically, Boulder Lode/Lone Star Mine is one of only two prospects in the Klondike that reached production.  Quartz veins at Boulder Lode cross-cut foliation at a high angle, have shallow dips, are typically 5 to 40 cm wide, and have demonstrated lateral and dip continuity on the order of 10’s of meters.  Multiple stacked veins and vein arrays are common.

Two new veins, “Vein 1” and “Vein 2”, were identified in 2014 located on the northeast wall of the Boulder Lode open-cut.  The veins were exposed by clearing bedrock obscured by gravel debris stacked on top by previous excavation efforts.  Vein 1, a 10 to 40 cm wide quartz vein, was sampled along a 5 meter length (sample ID # 1961631 to 1961634) and had a high assay of 1,766 g/t gold (see on-line Photo P1000178: https://www.klondikegoldcorp.com/wp-content/uploads/NR14Jan15-BoulderLodeVein1.pdf). Vein 2, a 2 to 10 cm wide vein, was sampled along a 4 meter length (sample ID # 1961651 to 1961656) and had a high assay of 67.2 g/t Au (see on-line Photo P1020604 https://www.klondikegoldcorp.com/wp-content/uploads/NR14Jan15-BoulderLodeVein2.pdf). Vein 2 is located 12 meters along strike from Vein 1 and these represent individual veins in the locally developed vein array.

Assays from ten prospecting samples collected from Vein 1 and Vein 2 at the Boulder Lode are listed in Table 1.  Prospecting samples are selective in nature, non-representative rock grab samples of bedrock. Systematic additional test results may vary significantly. Replicate analysis of samples 1961632 and 1961654 yielded consistent results.

Table 1: Boulder Lode Veins Assay Results

The exceptional gold-grade of Vein 1 in the kilogram per tonne gold range demonstrates the prospectivity of the structure which generated it.

The Boulder Lode has formerly been interpreted to have a west-northwest trend to mineralization, although this trend is not confirmed by considerable previous exploration.  The distribution of gold-bearing quartz veins is now interpreted by Klondike Gold to be controlled by a north-trending “D4-related” extensional fault evident in magnetic data which transects the Boulder Lode.  Historic drilling of approximately 100 core and reverse circulation holes in the Boulder Lode area have all had southerly azimuths, near-parallel to the plane of the “D4” fault, which may explain the sporadic nature of gold ‘hits’ in drill results.

Nugget to Buckland Prospects Area:

The Nugget and Buckland prospect area is sporadically exposed over a 1,500 meter strike length situated at a structural intersection where the main NNW-trending shear fault (magnetic ‘break’) steps to the north as an extensional pinnate fracture fault.  Individual quartz veins in the Nugget – Buckland area cross-cut foliation at a high angle, have variable dips, are typically 5 to 40 cm wide and up to 3 m wide, with demonstrated lateral and dip continuity on the order of 1 to 10’s of meters.  Multiple stacked veins and vein arrays are common.

Fourteen prospecting samples from bedrock (ID # 1961502, 1961508, 1961513, 1961519, 1961536 to 1961539, 1961609, 1961650, 1961891 to 1961894) assayed between 1.0 g/t Au and 19.4 g/t Au including eight samples with visible gold identified in outcrop (and removed from the sample prior to assay and retained as hand specimen).  A further 12 bedrock occurrences of visible gold in quartz veins were identified and not assayed.

Prospecting and mapping in 2014 in the Nugget and Buckland prospect area has shown that the intersection of the main NNW-trending shear fault with associated north-trending pinnate extensional fractures is a potential locus for gold-bearing quartz veins.  The structural style and inferred age relationships are analogous to that reported for gold mineralization discovered at Kinross Gold Corp’s Golden Saddle prospect located 50 km to the south.

Violet Prospect Area:

The Violet prospect was staked in 1901, excavated to a vertical depth of 47 meters with 133 meters of lateral drifting, and mined between 1903 and 1907.  Historically, Violet is the second prospect (the other is Boulder Lode/Lone Star Mine) in the Klondike that reached production.  Individual quartz veins at Violet are typically 10 cm to 2 meters wide, dip steeply, and have demonstrated lateral and dip continuity on the order of 10’s to 100’s of meters.  Multiple parallel quartz veins are inferred along the 3,500 meter length of the target area.  The prospect is very poorly exposed and has never been drill tested.

A total of seven prospecting samples collected from the Violet prospect and related known showings along a 3.5 km strike length assayed between 1.4 g/t Au and 13.9 g/t Au.  All samples had anomalous silver assays between 5 g/t and 95 g/t Ag.  Visible gold was identified in three limonitic quartz vein cobbles picked from the Violet mine dump retained for reference and not assayed.

Geotechnical Information

Sample ID #, corresponding gold and silver analyses, and UTM coordinates (NAD83) and a map are tabulated and shown for prospecting samples in this news release and posted to the Company’s website here (https://www.klondikegoldcorp.com/wp-content/uploads/NR14Jan15-LoneStarResults.pdf).

Prospecting samples are selective in nature, non-representative rock grab samples of bedrock or boulders collected to test for the presence or absence of gold and other ‘economic’ minerals.  Systematic additional test results may vary significantly.  Samples are usually 0.5 kg to 2.0 kg in weight.  The Company’s samples are spatially located to within 5 meters using a hand-held Global Positioning System (“GPS”) in NAD83 datum, assigned a unique assay tag, described, photographed using a GPS-enabled camera, then placed in a plastic bag and sealed.  Groups of sealed sample bags are aggregated in large fiber bags then security sealed for shipment.  For samples in this news release, the fiber bags were retained in locked storage in the Company’s Dawson office until after the end of the field season before being delivered by Company personnel directly to the lab.  Samples were submitted to Bureau Veritas Mineral Laboratories (“BV Labs”) (formerly Acme Labs) preparation facility in Whitehorse, YT with chemical analysis of sample pulps completed in Vancouver, British Columbia.  Bureau Veritas Labs is an accredited ISO 9001:2008 full-service commercial laboratory.

As per Klondike Gold’s instructions, at BV Labs each 1 kg rock sample is crushed to 80% passing 2 mm size.  A 250 g subsample is pulverized to >85% passing -75 microns size (Code PRP70-250).  A 30 g (1 assay ton) subsample is assayed for gold by fire assay (“FA”) fusion with an atomic absorption (“AA”) finish (Code FA430).  All over-limit results in excess of 10 ppm (10 g/t) for both silver and gold are re-assayed.  The re-assay uses a 30 g subsample and is assayed by FA with a gravimetric finish (Code FA530-Au/Ag).  Samples were also analyzed for multi-element chemistry by ICP-MS analysis (AQ200+U code).   Samples over-limit in lead are rerun by a high-detection limit ICP-ES procedure (Acme code MA370).

In addition to analyses of 2014 prospecting samples, there were analyses completed on 41 duplicates, 51 blanks, 32 Au-only standards, 33 Ag-Au standards, 6 Pb standards, and 28 ICPMS standards as part of QA/QC process.

Peter Tallman, Klondike Gold’s President and CEO, a Qualified Person as defined by NI43-101, has supervised, reviewed and approved the scientific and technical information contained within this news release.  Mr. Tallman is not independent of the Company as he is an Officer, Director, and shareholder.

ABOUT KLONDIKE GOLD CORP.

Klondike Gold Corp. is a Canadian exploration company with offices in Vancouver, British Columbia, and Dawson City, Yukon Territory.  The company is focused on exploration and development of its Yukon gold projects located in the historic Klondike region covering 25,000 hectares of hard rock and 2,000 hectares of placer claims including “McKinnon Creek” leased to Todd Hoffman/Jerusalem Mining LLC and featured on the Discovery Channel show “Gold Rush”.

On behalf of Klondike Gold Corp.

“Peter Tallman”

President and CEO
(604) 559-4440
E-mail: info@klondikegoldcorp.com
Website: www.klondikegoldcorp.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Disclaimer for Forward-Looking Information

“This press release contains “forward-looking information” and “forward-looking statements” within the meaning of applicable securities laws. This information and statements address future activities, events, plans, developments and projections. All statements, other than statements of historical fact, constitute forward-looking statements or forward looking information. Such forward-looking information and statements are frequently identified by words such as “may,” “will,” “should,” “anticipate,” “plan,” “expect,” “believe,” “estimate,” “intend” and similar terminology, and reflect assumptions, estimates, opinions and analysis made by management of Klondike in light of its experience, current conditions, expectations of future developments and other factors which it believes to be reasonable and relevant. Forward-looking information and statements involve known and unknown risks and uncertainties that may cause Klondike’s actual results, performance and achievements to differ materially from those expressed or implied by the forward-looking information and statements and accordingly, undue reliance should not be placed thereon. Risks and uncertainties that may cause actual results to vary include but are not limited to the availability of financing; fluctuations in commodity prices; changes to and compliance with applicable laws and regulations, including environmental laws and obtaining requisite permits; political, economic and other risks; as well as other risks and uncertainties which are more fully described in our annual and quarterly Management’s Discussion and Analysis and in other filings made by us with Canadian securities regulatory authorities and available at www.sedar.com. Klondike disclaims any obligation to update or revise any forward-looking information or statements except as may be required.”