Canada Gold Receives Conditional TSX Venture Exchange Approval for the acquisition of 700km2 of Prospecting Licenses in Tanzania

Vancouver, October 12, 2011 - Canada Gold Corporation (TSX-V: CI, Frankfurt: T9N, OTC-BB: CNGZF) (“Canada Gold“ or the “Company“) is pleased to announce that it has received conditional TSX Venture Exchange approval for its option to acquire a 100% interest in the Sindeni Project (the “Sindeni Project“) in North-Eastern Tanzania, Africa. Pursuant to the option agreement (the “Option Agreement“) with Falco Goldfields Limited (“Falco“), dated July 27, 2011, and amended September 23, 2011, the Company can acquire a 100% interest in 4 prospecting licenses, potentially hosting gold and other minerals, totaling approximately 702 square kilometers, by meeting the requirements outlined below. Falco will also be retaining a 2.5% net smelter return royalty, of which 1.5% can be purchased for US $2,000,000 at any time, once all considerations have been satisfied.

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|Payment Date           |US Cash    |?|Shares    |Work Commitment|
|----------------------------------------------------------------|
|On TSX Filing (paid)   |$ 50,000   |?|-         --              |
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|On TSX-V Approval      |$ 100,000  |?|1,000,000 |-              |
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|On 6 month Anniversary |$ 150,000  |?|500,000   |-              |
|----------------------------------------------------------------|
|On 12 month Anniversary|$ 150,000  |?|500,000   |-              |
|----------------------------------------------------------------|
|On 18 month Anniversary|$ 150,000  |?|500,000   |-              |
|----------------------------------------------------------------|
|On 24 month Anniversary|$ 150,000  |?|500,000   |$ 2,000,000    |
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|On 30 month Anniversary|$ 150,000  |?|500,000   |-              |
|----------------------------------------------------------------|
|On 36 month Anniversary|$ 150,000  |?|-         |$ 2,000,000    |
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|Total                  |$ 1,050,000|?|*3,500,000|$ 4,000,000    |
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* All shares issued are subject to a minimum 4 month hold from the date of issuance or as directed by the TSX-V


About The Sindeni Project

The Sindeni Project consists of 4 prospecting license, covering approximately 702 square kilometers, potentially hosting gold and other minerals. The Sindeni Project is located within the Mozambique Geological Belt, approximately 40 kilometers from the northeastern boundary of Canaco Resources Inc. (TSX-V: CAN), Magambazi Property, in the Handeni district in the Tanga region, northeastern Tanzania. The Mozambique Belt is highly deformed with shear zones developed on a north-eastern and mostly west north-western trend. Folding is present at both regional and local scale. These structures are an important target area for gold mineralization within the fold hinge zones, while erosion of the latter results in numerous small-scale alluvial workings within the Handeni District. The Canaco Magambazi Property is located on a northwest-southeast trending structure with artisanal gold workings nearby. The Sindeni Property has similar northwest-southeast trending structures, also with artisanal gold workings nearby. Canada Gold's initial exploration focus will be on two large areas near these artisanal workings.

As the Company does not have any work commitments for the first year of the Option Agreement, Canada Gold is currently reviewing potential exploration plans to determine the timing and amount of capital required for the initial exploration program. Further, the Company is currently in negotiations to acquire additional prospecting licenses in other areas of Tanzania, Africa, including the Sindeni/Handeni area in order to further enhance its holdings in this rapidly expanding gold district. The Company will provide additional information on these acquisitions as applicable.

Meanwhile, the Company has retained Mr. Paul Lemmon, P.Geo, FGS, Pr.Sci.Nat as Chief Geologist as well as the Qualifying Person under NI 43-101 for the Company. Paul, a professional geologist licensed by the Association of Professional Engineers and GeoScientists of New Brunswick, has held directorships of several exploration companies and is currently President of Northern Lights Exploration Services Corp., an exploration services consulting company based in New Brunswick, Canada; and Chief Geologist of CopperZone Resources Ltd. (Zambia), DiaGeo Resources Ltd. (Tanzania), and GWN Gold Inc. (Mali). Mr. Lemmon, a Professional Graduate of United Kingdom's Institute of Materials, Minerals, and Mining, is a member of several professional associations, a Fellow of the Geological Society of London UK, and was educated at Mt. Allison University in New Brunswick, and Universite de Strasbourg, France.

David McMillan, President and CEO of the Company comments “with Paul's extensive exploration experience and knowledge in Tanzania, we are pleased to welcome him to our team. The Company anticipates moving forward quickly with its exploration programs and evaluation of new acquisitions, with Paul directing our exploration programs and directly supervising our contract geologists in Tanzania“.

The company also announces that it has entered into an investor relations agreement (the “Agreement“) with Trident Financial Corp. (“Trident“) pursuant to which Trident will provide investor relations services to the Company. The Agreement is for a term of one year, effective October 15, 2011, during which time Trident will effect communications between the Company, its shareholders and prospective investors, and develop an investor relations program designed to raise awareness of the Company's business among prospective investors and the investment community.

Under the terms of the Agreement, the Company will compensate Trident $7,500 per month for the one year term of the Agreement. Pursuant to the Agreement, the Company has agreed to grant Trident incentive stock options to purchase up to 260,000 common shares of the Company at a price of $0.17 per share, exercisable until August 26, 2013. The options are subject to vesting provisions pursuant to which 25% of the options granted will vest in each quarter over 12 months.

The Company also announces that, in addition to the grant to Trident noted above, it has granted 1,281,111 incentive stock options, under the Company's 2011 stock option plan, to various directors, officers, and consultants at a price of $0.17, exercisable until August 26, 2013.

Mr. Nico Scholtz, Pri. Sci. Nat., principal geologist of Scarab, a qualified person under NI 43-101 has reviewed and approved the technical content of this news release.

The transactions contemplated herein are subject to final TSX Venture Exchange approval.

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


On behalf of the Board,

“Dave McMillan“
Dave McMillan, President & CEO



Neither 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.

Cautionary Note Regarding Forward-Looking Statements: Certain disclosure in this release, including statements regarding the Company's plans for and intentions with respect to exploration of the Sindeni Project, constitutes “forward-looking statements“ within the meaning of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities legislation. In making the forward-looking statements in this release, the Company has applied certain factors and assumptions that the Company believes are reasonable, including that the Company is able to obtain any required government or other regulatory approvals and any required financing to complete the Company's planned exploration activities, that the Company is able to procure equipment and supplies in sufficient quantities and on a timely basis and that actual results of exploration activities are consistent with management's expectations. However, the forward-looking statements in this release are subject to numerous risks, uncertainties and other factors relating to Canada Gold's operation as a mineral exploration company that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Such uncertainties and risks may include, among others, actual results of the Company's exploration activities being different than those expected by management, uncertainties involved in the interpretation of drilling results and geological tests, delays in obtaining required government or other regulatory approvals or financing, inability to procure equipment and supplies in sufficient quantities and on a timely basis, equipment breakdowns and bad weather. 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. Readers are cautioned not to place undue reliance on forward-looking statements. Canada Gold does not intend, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.