Release: Kalimantan Gold: Drill programme defines new mineralised areas at Jelai

(November 19, 2007) - Kalimantan Gold is pleased to report on drilling at its Jelai gold property in East Kalimantan, where the Company has drilled 16 scout holes of a 4,000 metre programme and achieved a number of promising results.

Working closely with the specialist mining consultancy, GMT Indonesia, KGC has so far completed a total of 1200 metres of drilling on the programme using an 80 metre capacity scout rig.

The scout drilling has successfully identified mineralised structures at shallow levels, outlining a series of new mineralized targets for deeper drilling into the gold system as part of the next phase of the programme. The scout drilling has also extended the preliminary drilling conducted by Indochina Goldfields (now Ivanhoe Mines) along the Mewet Vein and has identified new mineralised zones in the under-explored Sembawang and Lipan Vein systems which also form part of the property

Several of the other holes completed also intersected anomalous gold mineralised structures at shallow levels with strongly anomalous arsenic. In particular, extensions to the Mewet Vein have been delineated as far as 1,200 metres along strike from the Ivanhoe drilling and the Sembawang Vein scout drilling has proved the existence of gold mineralisation up to 800 metres along strike from the Ivanhoe drilling.

'We are very keen to start deeper drilling below the scout holes currently being completed as the Ivanhoe data indicates the vein structures widen and become more consistent at depth, particularly in areas such as the Mewet Vein,' commented CEO Rahman Connelly. 'The identification of new mineralized shoots along the Sembawang Vein also indicates that much further work is required to completely explore the vein systems mapped on surface,' he added.

The gold veins in the Jelai project are typical low sulphidation quartz-adularia veins with gold mineralisation concentrated in a series of interpreted 'mineralised shoots' along the various vein structures. When Ivanhoe Mines drilled the property in the late 1990's they identified extensive epithermal vein systems, which are the focus of the current drilling. The mineralisation and alteration within the project area is extensive and several vein systems, including undrilled veins to the east of the present drilling, remain untested. It is intended to systematically test a number of new targets within the next quarter to expand the number of follow-up targets and the use of the scout drill rig, which is highly mobile and has proved to be extremely effective in cheaply testing a wide variety of targets in a short period of time.

KGC geologists are continuing to refine further targets along the Sembawang Vein and scout drilling will be used to test both the Balangan Structure, a large silicified zone southeast of the Sembawang Vein with zones of quartz stockworks, and the southern extents of the Nyabi Vein in the near future. (end of edited release)