Mr. Kosta Tsoutsis reports

K9 GOLD ENTERS INTO AN EXPLORATION AND OPTION TO PURCHASE AGREEMENT FOR NEWMONT'S TRINITY SILVER PROJECT

K9 Gold Corp. has entered into an exploration agreement and an option to purchase and sales agreement with Newmont USA Ltd., a wholly owned subsidiary of Newmont Corp., regarding the Trinity silver project in Pershing county, Nevada. The project covers approximately 14,523 acres (5,881 hectares) of owned and leased land. The project is the site of a historic open-pit, heap-leach silver mining operation.

Jeff Poloni, chief executive officer of K9, commented: "We are extremely pleased with the opportunity to enter into an option to purchase agreement on an excellent brownfield exploration project. With improving silver prices, the Trinity silver project (which includes the historic Trinity mine) gives us the ability to potentially develop a promising asset in a mining-friendly jurisdiction."

The exploration agreement

The agreement grants K9 a lease to the exclusive right to conduct exploration work for minerals on the project lands currently owned by Newmont and a sublease for lands currently leased by Newmont. The terms of the agreement are as follows:

1. On the effective date, K9 shall pay $50,000 (U.S.) to Newmont and issue 100,000 common shares of K9 as rental payment for the properties during the first 12-month period of the agreement.
2. On or before the first anniversary of the effective date, K9 shall pay $100,000 (U.S.) to Newmont and issue 300,000 common shares of K9 as rental payment for the properties during the second 12-month period of the agreement.
3. These payments shall not be offset or credited against any production royalty.

The purchase and sale option for the properties

Subject to the conditions set out in the exploration agreement, the agreement states that Newmont will sell, assign, transfer, convey and deliver to K9 all of its right, title, interest and obligations in both the owned properties and the leased properties. The payment for the purchase shall be:

1. A one-time payment to Newmont of $350,000 (U.S.);
2. The issuance to Newmont of 700,000 common shares of K9;
3. The agreement is subject to a mineral production royalty at a rate of 2 per cent (net smelter return). K9 shall have the option, at any time prior to commercial production, to purchase one-half of the royalty for a payment of $3.5-million.

The performance of this agreement is subject to the approval of the TSX Venture Exchange.

A finder's fee, subject to the approval of the TSX Venture Exchange, is payable in regard to this transaction.

About the Trinity silver project

The Trinity silver project is located about 23 miles northwest of Lovelock in Pershing county, Nevada. The property lies on the west flank of the Trinity range in northern Nevada. Landholdings include 1,280 acres of land owned by Newmont and 18,350 acres in five separate leases. U.S. Borax and Chemical and a joint venture partner operated the Trinity open-pit, heap-leach mine from September, 1987, to August, 1988. U.S. Borax reported that it mined a total of 1,085,790 tons of silver oxide mineralization at an average grade of 6.32 ounces per ton (oz/t), recovering approximately five million ounces of silver.

The identified mineralization includes both oxide and sulphide material. A National Instrument 43-101 report ("Updated Technical Report on Resources, Trinity Silver Project, Nevada," prepared by SRK Consulting and dated Feb. 26, 2013) reported mineral resource estimates. The resources are reported separately for the oxide and sulphide material, as detailed in attached tables.

An historical stockpile exists on the property with a reported content of:

These estimates are considered to be historical in nature. Although these estimates were made by a well-established international engineering consultancy group, the company is not treating these historical estimates as a current resource. The qualified person has not done sufficient work to classify the estimates as a current resource and there is no guarantee that further work will convert these historical estimates to current resources. Additional work to upgrade to a current estimate for the in-place mineralization will include a detailed review of historical drilling to evaluate its validity, twinning of selected drill holes and possibly additional drilling. For the stockpile, a program of test hole drilling will be required.

The Trinity project lies on the western flank of the Trinity range, one of the generally north-trending ranges formed during Tertiary extension of the Basin and Range province.

Within the Trinity Ranger the basement rocks comprise the Middle Triassic to Early Jurassic near-shore deltaic deposits of the Auld Lang Syne Group, which are represented by phyllite, argillite, quartzite and dirty limestone at the Trinity project. The best-represented pre-Cenozoic deformation in this portion of the Trinity range is the Jurassic and Cretaceous Nevadan orogeny, which resulted in low-grade regional metamorphism, variably directed folding and thrust faulting. A Cretaceous intrusive episode culminated the Nevadan orogeny and is exemplified by a Cretaceous granodiorite stock just northeast of the Trinity project.

Tertiary volcanic and sedimentary rocks and Quaternary sediments are abundant in the Trinity project area. There is a thin Tertiary rhyolite sequence along the central north-south axis of the property that includes the resource area. These volcanic rocks overlie the Mesozoic phyllite and argillite, exposed to the east, but are separated by an argillite breccia that is closely associated with faulting. The rhyolite includes interbedded rhyolitic flows, welded tuffs, air-fall tuffs, epiclastic tuffs and lacustrine deposits. Several rhyolite domes, dikes and sills have also been identified on the property, some of which may be related to mineralization. Early Tertiary north- to northwest-trending faults are present in the Trinity project area, as are younger north- to northeast-trending normal faults. Late Tertiary and/or Quaternary bench and channel gravel deposits and Quaternary alluvium and outwash unconformably overly the rhyolites and cover the western part of the property.

Rhyolite porphyry, aphanitic rhyolite and volcaniclastic rocks are the principal host rocks for mineralization in the Trinity mine area. Silicification and quartz-adularia-sericite alteration are associated with the mineralization. Tertiary rhyolitic tuffs and flows were extensively altered and form a halo extending 1.6 miles beyond the main mineralized area. This alteration affected the Auld Lang Syne Group only locally along faults and breccia zones.

Mineralization at the Trinity project is controlled by a northeast-trending zone of normal faults. Silver, lead and zinc mineralization occurs in fractures and bedding planes in Tertiary rhyolite in the hangingwall block of the fault zone. Although mineralization continues downward into the underlying Triassic rocks, it is more tightly constrained to fractures that host higher-grade vein mineralization. The original Trinity silver deposit can generally be divided into two parts: a sulphide zone below the current pit and to the northeast, and an overlying oxide zone. Borax's mining in the late 1980s focused on a portion of the oxide zone.

Mineralization occurs as oxidized and unoxidized sulphides in veinlets, as fracture-controlled mineralization and as disseminations within the host rocks, including breccia matrix. Sulphide mineralization consists mainly of pyrite, sphalerite, galena, marcasite and minor arsenopyrite with various silver minerals, including tetrahedrite-freibergite, pyrargyrite, minor argentite and rare native silver, with traces of gold, pyrrhotite, stannite and chalcopyrite. Low-grade lead and zinc have the potential to add value as byproducts.

Next steps

The company plans to immediately commence work on a review of all historic data and to create an updated database for the project. Artificial intelligence will be incorporated to review all geological, geophysical and geochemical data with the objective of creating an updated deposit model. A review of structural patterns is also planned, using satellite imagery and other geospatial information. Fieldwork will include sampling of the historical stockpile and drilling to twin key historical drill holes.

This will be followed by additional drilling leading to an updated mineral resource estimate.

About K9 Gold Corp.

K9 Gold has assembled a highly experienced and dynamic team to explore the Trinity silver project. K9 also operates the Stony Lake gold project in central Newfoundland. The project has been acquired from District Copper Corp. by an option agreement, whereby K9 can earn up to a 100-per-cent interest in the project (see the company's news release dated July 30, 2020).

Chris M. Healey, PGeo, chief geologist and a director of K9 Gold, is the qualified person under National Instrument 43-101, who is responsible for the technical content of this news release and approves its release.

The company is listed on the TSX Venture Exchange.

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