PNG Gold Corporation: Provides Corporate and Exploration Update

- New Director Appointed and $9.3 Million Budget Approved
- 17.75 g/t Au Over 0.6 Metres Reported

VANCOUVER, Oct. 14, 2011 - PNG Gold Corporation (TSX VENTURE: PGK) ("PNG Gold" or the "Company") issues an update on corporate developments and initial exploration results of the continuing diamond drilling program and other operational activities at the Imwauna Project, Normanby Island, Milne Bay Province, Papua New Guinea.


Corporate

PNG Gold is pleased to announce the appointment of Mr. John Detmold to the Board of Directors. Mr. Detmold has over 30 years of corporate finance, banking, leasing and manufacturing experience. He is the founder of Invecture Group, S.A. de C.V. that acts as the holding company for Frontera Copper Corporation. He also serves as Chief Financial Officer of Frontera. Mr. Detmold is the Chairman of Communicacion Xersa, S.A. de C.V., an FM radio broadcaster based in Mexico serving the San Diego market. He is a director of Black Iron Inc. and chair of its Audit Committee. He is an active member of the Young Presidents Organization and the World Presidents Organization. Mr. Detmold graduated from McGill University with an honours Bachelor degree in Economics.

Mr. Dick Whittington, President and CEO of PNG Gold Corp., comments; "We are very pleased to have someone with John's background and experience join our Board. His appointment will greatly assist us in developing the Company going forward and we look forward to working with him in his new capacity."

The Company is also pleased to announce that The Board of Directors has approved the operating budget for the final 4 months of 2011. The budget has been established at $Cdn 9.3 million to focus on exploration, and improvements to site infrastructure, at the Company's Imwauna project site on Normanby Island as well as to support the Company's ongoing corporate activities. This level of expenditure is expected to allow the Company to exercise its option to acquire the remaining 50% ownership of the Normanby property it does not already control, prior to the end of the year.


Exploration Update

Diamond drilling was initiated on Normanby Island in January, 2011. The program has continued with two rigs during the intervening months and to the end of August, 2011, 6852 m have been completed in 44 drill holes. The holes have been designed to in-fill existing shallow drilling on a maximum 50 m grid spacing and to explore the vein system below the previous 100 to 150 m vertical depth of drilling. The next phase of the program will continue to explore the vein system at depth and provide additional detail in the higher grade parts of the deposit.

Additionally, two geotechnical holes totalling 398 m were drilled into a rock face to evaluate its suitability for collaring an underground portal. One hole was drilled horizontally, the second at -20° through the footwall of the vein system to the approximate position of veins. No significant faulting was intercepted in either hole at least as far as the mineralized zone and the vein intercepts were in the locations expected.

The Company has a few assay results to hand at the present time. A summary of the initial assay results from 203 samples cut from the first 7 holes are presented in the following table. The analysis of the major components of the drilling programme are pending (see below). The best results from the first batch of samples were in hole IMH 181 in which a 0.6 m vein contains 17.75 g/t Au and in hole IMH 184 in which the Main vein assays 5.13 g/t Au over 1.8 m.


Table 1: Imwauna assay results

Hole ID Easting Northing Elev (m) Dip Azimuth From (m) To (m) Vein Length (m)* Au (g/t) Ag (g/t)
IMH 179 289155 8887307 460 -60 106 nsv
IMH 180 289169 8887302 460 -75 106 nsv
IMH 181 289107 8887063 449 -55 106 34 34.9 0.9 1.46 2.8
and 37 42.6 5.6 3.07 11.4
Including 42 42.6 0.6 17.75 71.6
IMH 182 289107 8887063 449 -70 106 83.6 84.6 1.0 1.51 1.6
IMH 183 289079 8887005 482 -75 106 108.3 110 0.4 2.855 11.5
IMH 184 289039 8886968 489 -45 106 45 47.6 1.8 5.13 14.7
IMH 185 289042 8886947 488 -60 106 52.7 53.6 0.5 4.44 7.8
and 84.7 85.7 0.5 4 18.9

*reported widths are core lengths and not the true width of the veins
nsv – no significant values

A second shipment of samples containing 1768 core samples from 36 drill holes is currently in Townsville, Queensland where they will be prepped and assayed at the ALS-Chemex laboratory. Results are expected towards the end of October and into November. The Company will issue new results as they become available.

Drilling is continuing and the program will be increased to 4 drills in the near future. One drill will be designated to test other prospects on the property, primarily the Kela's vein system which occurs 650 m west of the Imwauna deposit. The Kela's prospect is an exciting new opportunity for the Company. The following description is given in the Company's Technical Report from last November:

"The Kela's vein prospect, when compared to the Imwauna prospect, has a stronger and more continuous anomalous soil response. Of 58 float and sub-outcrop samples reported by Macmin/NGG (Second Quarter Technical Report, 1995) 12 contained over 7 g/t gold with assays of 33.60 g/t, 35.70 g/t and 41.52 g/t Au suggesting the possibility of localized, high grade gold-vein mineralization in the Kela's system."

Kela's has not previously been drilled although surface rock and soil sampling as well as trenching have indicated gold-mineralized veins occur over a total strike length of 1800 m and at least intermittently across a width of 300 m. Individual veins average about 1 m in thickness. An initial program of 5000 m of drilling is planned for Kela's veins.


Logging, sampling and assaying procedures

All holes drilled by PNG Gold are collared using HQ triple tube drill tools. A few holes have been reduced to NQ size at depth in the hole in order to continue the hole. Geotechnical measurements such as core recovery, fracturing and veining, rock quality designations (RQD's), hardness and photographic logging are performed systematically prior to sampling and assaying. The core is logged, samples selected by PNG Gold geologists then systematically sawn in half at the site. The one half core sample is numbered then sealed in a bag and delivered by PNG Gold to its base in Alotau where the samples are palletized and placed in a container for shipment to ALS Chemex in Townsville, Australia. The other core half is retained on the site.

Core samples are dried, crushed and pulverized to 85% passing through a 75 micron mesh. The pulps are assayed for gold using a 50 g split, Fire Assay (FA) and AA finish.


Quality assurance / Quality control (QA/QC)

The ALS Chemex lab is an ISO 9001:2008 qualified assayer that performs and makes available internal assaying controls. Duplicates, certified blanks and standards are systematically used as part of PNG Gold's QA/QC program. The Company also inserts blind standards with each sample batch at the rate of about 1:10. Rejects and pulps are stored at the lab for future reference.


Qualified Person

Mr. Ian Taylor, MAusIMM(CP) is the independent qualified person in accordance with National Instrument 43-101, is responsible for establishing and overseeing QA/QC procedures for the Imwauna drilling program and has approved the technical information contained in this news release.


Other Activities

A pre-feasibility study is in progress under the supervision of Lycopodium, a Brisbane-based mineral engineering group. Other principal consultants to the study are Australian Mine Design and Development (AMDAD) and Mining Associates, also of Brisbane. Objectives of the study are to incorporate the new drill information in a mineral resource estimate in order to underpin a mine plan and schedule, the design of the process plant, tailings storage, roads, marine facilities and other supporting infrastructure as well as the related capex and opex estimates. The study is expected to be completed in the Q2 – 2012.

In conjunction with the PFS an environmental and social impact assessment contract has been awarded to Eco-Care Engineering of Port Moresby, PNG.

A priority for the remainder of the year is to improve infrastructure on the Imwauna Project site. Discussions are ongoing with local contractors to enhance the marine access and offloading capability, upgrade the 4 km tote road from the coast to the camp, and install a new accommodations facility. The Company has also made improvements to the Sehulea airstrip, 10 km to the east of the site, and is working with the PNG aviation authority to re-certify it for use.

The Company is continuing to evaluate the timing of an underground exploration program. Discussions with qualified mining contractors are well advanced on the scope of work to develop two portals and access drifts on two levels and the related costs. The permitting and approval process with the PNG government is also in progress.

Mr. Dick Whittington, President and CEO of PNG Gold Corp., commented that, "I am pleased to see the progress made towards the implementation of our business plan. We are looking forward to the results of the recent exploration drilling at Imwauna and are excited about starting to drill the Kelas prospect. Exploration drilling will continue apace and will remain the prime focus of the Company for the immediate future; however, we will continue to monitor world markets and will be exercising caution in our spending until market stability is restored."


About the Imwauna Gold Deposit

The Imwauna exploration license is located on the north side of Normanby Island approximately 80 km northeast of Alotau, the provincial capital of Milne Bay Province, Papua New Guinea. Alotau is serviced by daily flights from Port Moresby the national capital and scheduled coastal freighters. PNG Gold maintains a logistics base in Alotau to supply the Normanby Island site.

The Imwauna prospect is an epithermal, low sulphidation quartz vein system comprising two principal veins, the thicker, more continuous Main vein and the East vein. These may be accompanied by a network of narrower veins and veinlets as intersected in drill hole IMH 181 (see Table 1). The mineralized veins consist of finely crystalline quartz, white to grey in colour and display typical epithermal textures such as vugs, dog tooth crystals and fine, chalcedonic layering. Sulphides are rare to absent although some deeper intersections contain a few per cent of fine pyrite. Vein margins are often brecciated and re-sealed with silica.

Past exploration drilling in some 178 drill holes (see PNG Gold Corp. Technical Report, November 30, 2010 on SEDAR) has outlined a narrow zone of gold mineralization over a strike length of at least 900 m to an average vertical depth of about 100 m. Widths are usually 1 to 3 m in the Main vein but less in the East vein.


Imwauna Option Agreement

PNG Gold currently has title to 50% of the Imwauna property (Exploration License 1091) and is earning the remaining 50% from New Guinea Gold Corp. by spending $Cdn 8 million in exploration over a three year period. To the end of August, PNG Gold has spent in excess of $5 million and expects to be in a position to exercise the option by the end of this year.


About PNG Gold Corporation

PNG Gold Corporation is the new name of International Silver Ridge Resources Inc., following its business combination with NMC Mining Corp. completed on June 7, 2011. PNG Gold holds a 50% interest in the Imwauna and Sehulea properties on Normanby Island, Milne Bay Province, Papua New Guinea, and an option to acquire the remaining 50%. PNG Gold trades on the TSX Venture Exchange under the symbol PGK. PNG Gold's mission is to become the premier exploration and development company in Papua New Guinea.

For further details, please visit the Company's website at www.pnggold.com.


ON BEHALF OF THE BOARD OF DIRECTORS

J.R.H. (Dick) Whittington
President & CEO



Forward-Looking Statements

Certain information set forth in this news release contains forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements relate to matters such as results of exploration and development of the Normanby Property and completion of financing and are subject to numerous risks and uncertainties, certain of which are beyond the control of PNG Gold, including, but not limited to, the impact of general economic conditions, industry conditions, financial market conditions, dependence upon regulatory and shareholder approvals, and the uncertainty of completing intended financing and obtaining additional financing. Exploration of mineral properties is subject to the inherent risk that it may not result in commercial discovery. Readers are cautioned that the assumptions used in the preparation of forward-looking statements, although considered reasonable at the time of preparation, may prove to be incorrect and, as such, undue reliance should not be placed on forward-looking statements. PNG Gold expressly disclaims any obligation to update forward-looking statements contained herein except as required by applicable law.

No regulatory authority has approved or disapproved the information contained in this news release. 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.

NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. NEWSWIRE SERVICES



Contact Information

PNG Gold Corporation
Dick Whittington, President and CEO
604-669-4899
604-685-2345 (FAX)
www.pnggold.com