PNG Gold Corporation Provides Exploration and Project Development Update on Imwauna Gold Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 23, 2012) -

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

PNG Gold Corporation ("PNG Gold" or the "Company") (TSX VENTURE:PGK) provides exploration and project development updates for the Imwauna Gold Project and nearby Sehulea property, both located on Normanby Island, Milne Bay Province, eastern Papua New Guinea with highlights as follows:

• Renewal of exploration licenses EL 1091 and EL 1069 anticipated in normal course of business
• Drill hole assay results from Imwauna drill program expected by February 2012
• Drill program on previously undrilled Kela's prospect to commence in Q1 2012
• Design and fabrication contract awarded for on-site operations offices and staff quarters and site construction underway
• NI 43-101 complaint mineral resource estimate on track for Q2 2012
• Open pit mining potential in conjunction with U/G mining now
• Being reviewed and re-assessed as part of the preliminary feasibility study

EXPLORATION PROGRAM UPDATE:

Exploration Licenses:

PNG Gold owns 100% of the 68 km² Exploration License (EL) 1091, which encompasses the Imwauna Project as well as the nearby 30 km² Sehulea property, Exploration License (EL) 1069 (see PNG Gold news release, October 31, 2011). The Company has submitted an application to the Mineral Resource Authority, the government agency responsible for mineral rights and mining in Papua New Guinea, to have the full ownership of the licenses transferred to PNG Gold's local operating subsidiary, Normanby Mining PNG Ltd. Requisite renewal applications have also been submitted to extend the exploration licences on both properties for a further two years. The Company anticipates that both licences will be renewed in the ordinary course of such applications.

Exploration Update - Imwauna Gold Project:

During the 2011 calendar year, the Company completed 12,089 m in 71 drill holes. The holes were designed to provide additional information in shallow depths of the mineralized zone and to explore the extension of the vein system at depths below 100 m from surface. Assays have previously been released for 38 drill holes (see PNG Gold news releases, October 13, 2011 and November 17, 2011) and another 33 drill holes totalling 6,531 m (Table 1) have been sampled. Samples cut from holes IMH217 to IMH237 (21 holes) are currently at ALS-Chemex in Townsville, Queensland, awaiting sample prep and analysis. The lab experienced a larger than expected influx of samples at year end but expects to have the backlog processed by the end of January. The remaining samples, cut from holes IMH238 to IMH251 (12 holes), are currently en route to ALS Chemex.

In addition to further drilling on the Imwauna deposit, approximately 5000 m of drilling is planned for the first phase of drilling on the Kela's vein system commencing in Q1 2012. The Kela's vein system is sub-parallel to and approximately 650 m west of the Imwauna deposit and no previous drilling has been done on the prospect. Prior to PNG Gold's acquisition of the property, Kela's was explored by New Guinea Gold primarily using soil and rock geochemistry and surface trenching. Previous results demonstrated the presence of gold mineralized veins in float and bedrock in the trenches all within an extensive gold-in-soil anomaly. Trench assays can be viewed at: http://www.pnggold.com/i/maps/imwauna_trench_results.jpg. The Kela's veins occur over a strike length of at least 1 km and appear to trace an arcuate outcrop pattern which joins the southern extension of the Imwauna vein system.

Exploration Update - Sehulea Property:

The Company also completed 3 holes of a planned 4-hole program on the Sehulea property (EL) 1069, approximately 10 km northeast of Imwauna. The holes were targeted on strong IP anomalies on Lataona Hill and adjacent the previously drilled Weioko gold prospect. Sampling completed has been sent for analysis. Once the 4-hole drill program has concluded, the drill will be returned to the Imwauna property to continue drilling on the Imwauna and Kela's prospects.

Exploration Update - Site Construction:

In December 2011, the Company executed a contract with PNG Forest Products Ltd. to supply pre-fabricated accommodations and kitchen/dining buildings for the Imwauna project. The buildings will provide improved dwelling and support facilities for project personnel and visitors. All design and fabrication of the structures will be carried out in the supplier's manufacturing facility in Bulolo, Papua New Guinea. This is in line with the Company's desire to significantly enhance the on-site facilities in preparation for future underground exploration and mine development activities.

On January 16, 2012, the Civil Aviation Authority of Papua New Guinea completed an inspection of the Sehulea Aerodrome, located on Normanby Island, and declared it be in satisfactory condition for aircraft operations. Availability of the Sehulea airstrip will now increase the transportation options open to PNG Gold and improve logistical efficiency of the transport of both personnel and supplies to and from the Imwauna Gold Project and Sehulea property.

PROJECT DEVELOPMENT UPDATE:

Project Development Update - Imwauna Gold Project:

PNG Gold's revised project development timeline is attached (Table 2). While the timeline outlines specific dates and activities that may change over time, it does provide target dates that management is working towards. The first key date is for the release of a NI 43-101 compliant mineral resource in Q2. The Company is on track to meet that target.

Preliminary engineering analysis by PNG Gold's engineering consultant has highlighted the potential for an open pit along the strike of the Imwauna vein system in conjunction with or preceding underground development. In order to better understand the development trade-offs, the Company is deferring its plans to immediately develop underground workings pending the results of the NI 43-101 mineral resource work.

Given the potential economic benefits of an open pit versus commencing operations underground, the Company wishes to fully evaluate the size, scope and location of an open pit relative to any underground workings and to do so prior to initiating any underground development work. This will be reassessed as part of the preliminary feasibility study which will incorporate the NI 43-101 mineral resource estimate expected in Q2.

Conference:

PNG Gold will host a booth at the Vancouver Cambridge Investment Conference, January 22 and 23, 2012. All shareholders and investors are cordially invited to visit the Company's booth and to meet with management and our Investor Relations Manager.

Qualified Person:

Mr. Colin McKenzie, P.Geo and COO of PNG Gold, is a qualified person in accordance with National Instrument 43-101 and has reviewed and approved the technical information contained in this news release.

About the Imwauna Gold Project

The Imwauna exploration license covers an area 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. 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 percent of fine pyrite. Vein margins are often brecciated and re-sealed with silica.

Historic exploration drilling in 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. The drilling program is designed to extend the deposit to depth and obtain sufficient information to support an initial NI 43-101 compliant mineral resource estimate, now scheduled for the second quarter 2012.

About PNG Gold Corporation

PNG Gold Corporation is an exploration company with an advanced stage drilling program in Papua New Guinea. PNG Gold holds a 100% interest in the Imwauna and Sehulea properties on Normanby Island, Milne Bay Province, Papua New Guinea, and 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

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

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.

Table 1: Imwauna drill holes with assays pending

Hole ID	Easting	Northing	RL	Dip	Azimuth	EOH
IMH217	288791.3	8886577.5	566.3	-60	100	220.0
IMH218	288848.0	8886663.3	537.1	-70	100	270.4
IMH219	289052.9	8886881.3	498.5	-55	100	81.0
IMH220	289282.6	8887088.3	396.7	0	260	247.0
IMH221	289073.9	8886953.5	482.2	-50	100	84.0
IMH222	289282.6	8887088.3	396.9	-20	260	151.3
IMH223	289073.0	8886953.9	482.3	-70	100	89.6
IMH224	289122.9	8887254.9	468.2	-75	100	299.8
IMH225	288912.4	8886772.9	551.0	-70	100	254.3
IMH226	288936.0	8886765.0	549.1	-60	100	260.6
IMH227	289049.0	8886759.0	529.0	-70	100	200.8
IMH228	288931.0	8886759.0	556.0	-50	280	261.0
IMH229	288965.0	8886879.0	523.0	-70	100	177.0
IMH230	289072.0	8887111.0	527.0	-50	100	196.0
IMH231	288977.0	8886867.0	512.0	-70	100	225.0
IMH232	289081.0	8887005.0	504.0	-50	100	200.8
IMH233	289081.0	8887006.0	504.0	-70	100	181.2
IMH234	289063.0	8887120.0	527.0	-70	100	201.4
IMH235	288989.0	8886984.0	503.0	-70	100	252.0
IMH236	0289282	8887088	397.0	-20	280	200.9
IMH237	0288905	8886657	560.0	-70	100	206.6
IMH238	0288911	8886618	547.0	-70	100	157.9
IMH239	0289282	8887088	397.0	-40	280	210.9
IMH240	0289341	8887186	418.0	-52	280	288.8
IMH241	0289080	8886881	572.0	-70	100	149.8
IMH242	0289272	8887032	431.0	-55	280	287.5
IMH243	0289253	8887167	426.0	-60	280	201.0
IMH244	0289080	8886881	572.0	-70	280	189.6
IMH245	0289253	8887167	419.0	-20	280	115.0
IMH246	0289246	8886963	483.0	-45	280	287.4
IMH247	0288859	8886475	537.0	-50	280	196.6
IMH248						Not yet drilled
IMH249						Not yet drilled
IMH250	0289265	8886984	455.0	-46	280	296.9
IMH251	0289274	8887041	443.0	-40	280	113.6

To view Table 2, click on the following link: http://media3.marketwire.com/docs/p120.pdf