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Kestrel Gold Announces Closing First Tranche of Private Placement

October 29, 2010

Kestrel Gold Inc.(the "Corporation") (TSX VENTURE:KGC) is pleased to announce that it has successfully completed the first tranche of its previously announced private placement (the "Offering") in respect of 4,553,000 units ("Units") of the Corporation at a purchase price of $0.40 per Unit for total proceeds of $1,821,200.

Each Unit consists of one (1) common share ("Common Share") and one (1) Common Share purchase warrant ("Warrant") of the Corporation. Each Warrant entitles the holder to purchase one (1) Common Share at a purchase price of $0.60 per Common Share exercisable on or before one (1) year from October 29, 2010, (the "Closing Date").

The Offering was conducted on a non-brokered basis. However, the Corporation paid $53,550 and granted 141,550 Common Shares and 295,550 broker's warrants ("Broker's Warrants") to certain arms length finders in connection with the Offering. Each Brokers Warrant entitles the holder to purchase one (1) Unit at a purchase price of $0.40 and is exercisable on or before one (1) year from the Closing Date. 

All Common Shares, Warrants, Broker's Warrants and any Common Shares into which such securities may be converted shall be subject to a four (4) month hold period ending on March 2, 2011. 

The net proceeds of the Offering shall be used for general working capital purposes. The second and final tranche of the Offering is expected to close on or around November 3, 2010. The Offering is subject to final approval by the TSX Venture Exchange (the "Exchange"). 

About Kestrel Gold Inc.

Listed on the Exchange, Kestrel is committed to acquiring, exploring and development precious metal projects in North and South America. It has an experienced and committed board of directors and the financial ability to aggressively meet its objectives.

Cautionary Statements

Except for statements of historical fact, all statements in this news release, without limitation, regarding new projects, acquisitions, future plans and objectives are forward-looking statements which involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those expressed or implied by such forward-looking information. Risks include delays in obtaining or failure to obtain regulatory approval. Except as required by applicable securities legislation, the Company undertakes no obligation to publically update or revise forward-looking information, whether as a result of new information, future events or otherwise.

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