Kootenay Announces Three Diamond Drill Rigs Now Operating on Promontorio

VANCOUVER, June 29, 2011 /PRNewswire/ --

Shares Outstanding: 44,958,100

Kootenay Gold Inc. (TSX VENTURE: KTN.V) is pleased to announce it now has three core drills operating at the Company's Promontorio Silver Project in Sonora, Mexico with the recent commencement of drilling of the third diamond drill rig.

As previously announced on May 31, 2011, the drills are executing a 25,000 meter diamond drill program to follow up on the success of the Company's recently concluded 10,000 meter drill program on Promontorio. The current drill program represents the single largest and most expansive drilling campaigns conducted on Promontorio to date. The multi-phase step out and in-fill drilling program at Promontorio will be ongoing for the next several months.

The three core drills will be concentrating on step out holes and in-fill drilling to determine continuity between the numerous medium to high-grade silver intercepts encountered along Promontorio's 1.0 kilometer mineralized corridor. This corridor includes the Pit Resource, Pit NE zone, Northeast Zone and the Southwest zone.

The objective of the program is to define Promontorio's mineralized boundaries and to determine the continuity and grade of silver mineralization between individual drill intercepts at surface and at depth to begin establishing the overall size and scope of the contained silver resource.

The Company plans to provide an updated NI 43-101 resource calculation at the conclusion of the program. To further accelerate the future permitting and feasibility process on Promontorio, preliminary work for baseline, further metallurgical and technical studies have been initiated in conjunction with the current drilling program.

The foregoing geological disclosure has also been reviewed and verified by Kootenay's CEO, James McDonald, P.Geo (a qualified person for the purpose of National Instrument 43-101, Standards of Disclosure for Mineral Projects). Mr. McDonald is a director of Kootenay.

ABOUT KOOTENAY

Kootenay Gold is actively developing mineral projects in the Sierra Madre Region of Mexico and in British Columbia, Canada. The Company's flagship property is the former producing Promontorio Silver mine in Sonora State, Mexico. The Company's objective is to develop near term discoveries and long term sustainable growth. Kootenay's management and technical team are proven professionals with extensive international experience in all aspects of mineral exploration, operations and venture capital markets. Multiple, ongoing J/V partnerships in Mexico and Canada maximize potential for additional, new discoveries while maintaining minimal share dilution.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.
Cautionary Note to US Investors: This news release may contain information about adjacent properties on which we have no right to explore or mine. We advise U.S. investors that the SEC's mining guidelines strictly prohibit information of this type in documents filed with the SEC. U.S. investors are cautioned that mineral deposits on adjacent properties are not indicative of mineral deposits on our properties. This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

2011 number 14

For further information:

James McDonald, CEO and President at +1-403-238-6986
Ken Berry, Chairman at +1-604-601-5652; +1-888-601-5650
or visit:  http://www.kootenaygold.ca