CANADA GOLD COMPLETES SECOND TRANCHE OF PRIVATE PLACEMENT

Dec. 1, 2009 (TheNewswire.ca) --

Vancouver, British Columbia - December 1 2009 - Canada Gold (OOTC:CNGZF) (TSXV:CI) Corporation (TSXV: CI, Frankfurt: T9N, OTC: BB CNGZF)(the "Company") announces that further to its news release dated November 9, 2009, the TSX Venture Exchange has approved the second tranche of the Company's private placement for gross proceeds of $885,000.

These units are subject to a four month hold expiring March 26, 2010.

The Company has issued 2,681,818 common shares and 1,340,909 share purchase warrants, and together with the first tranche, the Company has issued a total of 3,500,000 shares and 1,750,000 warrants for total proceeds of $1,115,000. Each whole warrant entitles the holder to purchase an additional common share of the Company at a price of $0.50 in the first 12 months from closing and $0.65 within the next 12 months of closing. Both time periods are subject to a warrant exercise acceleration clause if the underlying common shares trade at or above $0.80 for a period of 20 trading days.

Hidden Placees - 39

Insider Participation - Andrew Neale - 295,818 units

Finders fees for the placement equaled $70,488 in cash and 187,100 warrants.

Canada Gold is currently developing a mineral processing facility in Northern Peru. The proceeds of the private placement will be used for plant site acquisition costs, initial deposits on long lead time equipment purchases, environmental impact studies, on-site engineering and general working capital.

ABOUT CANADA GOLD

Canada Gold has been formed for the express purpose of developing mineral processing facilities in small-scale (artisanal) mining communities. By providing local miners with access to advanced ore processing techniques, the Company's toll processing model seeks to assist these mining communities establish sustainable socio-economic standards by encouraging entrepreneurship, curtailing health and safety risks, improving access to education and equipment, reducing environmental degradation, and minimizing the pressures contributing to child labour.

Local communities are showing strong support for the project as they understand the local social and economic benefits of having a modern processing facility located within their existing mining areas. Regional and Federal regulators have also voiced strong support for the project. The Canada Gold facility will provide an alternative processing option to the numerous small unregulated mercury amalgamation plants in the area and the associated health and environmental impacts accruing from these small scale processing activities. The start-up and commissioning of Canada Gold's first processing plant in northern Peru is scheduled for late 2010.

ABOUT ARTISANAL SMALL SCALE MINING

Much of the developing world possesses significant informal artisanal small scale mining communities, notorious for their low health, safety and environmental standards, yet recognized for their significant social and economic influence. The organization of Communities and Small Scale Mining ("CASM") suggests between 13 and 20 million men, women, and children from over 50 developing countries are active in small scale activities, with 100 million more dependent on this sector for their livelihood.

For more information, please contact the office or visit www.canadagold.com

On Behalf of the Board,

"Dave McMillan"

Dave McMillan

Executive Chairman

Canada Gold Corporation

Chad McMillan

Vice President, Communications

(604) 685-5851 or Toll Free: (888) 685-5851

Fax: (604) 685-7349

ir@canadagold.caom

http://www.canadagold.com

Corporate Head Office:

Suite 520 - 700 West Pender St

Vancouver, BC CANADA

V6C 1G8

This communication to shareholders and the public contains certain forward-looking statements. Actual results may differ materially from those indicated by such statements. All statements, other than statements of historical fact, included herein, including, without limitations statements regarding future production, are forward looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. 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.

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