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AM Gold Demonstrates Large Volumes Of Gold-Bearing Rock Through Extensive Drilling On Red Mountain Dome, Yukon Territory, Canada

January 23, 2012

AM GOLD INC. (TSXV: AMG; FRANKFURT: AMX) (“AM Gold” or the "Company") has demonstrated through its 2010-2011 drill programs, that Red Mountain is comprised of an extensive gold-mineralized Tombstone intrusive rock complex enveloped by a carapace-like zone of altered sedimentary rocks which are also mineralized with gold.  The Company has established the potential for extensive tonnages of material extending to depth from surface that will require additional drilling to delineate its overall distribution.

Red Mountain is a dome rising 500 meters above the surrounding valley elevation of 1,000 meters. Geological, geophysical and geochemical data together with 16,572 meters of drilling in 61 diamond drill holes to date show that much of Red Mountain is prospective for gold mineralization.  A volume of prospective rock measuring 3.5 by 2 kilometers in surface extent and extending to at least 500 meters depth has been established from the geological and geochemical data framework. Geophysical data indicates the intrusive rock forms the core of the dome extending to over 1000 meters in depth. The prospective intrusive host rock is interpreted to comprise a volume potentially exceeding 5 cubic kilometers.

This news release includes a comprehensive tabulation summarizing the previously disclosed intervals identified from the completed 2010 and 2011 diamond drill holes - all of which exhibit gold mineralization.  In total, the Company drilled 35 holes at Red Mountain in 2010 and 2011.  The results from the 35 drill holes were disclosed in the Company’s news releases dated October 5, 2010, October 25, 2010, November 4, 2010, November 16, 2010, November 30, 2010, November 22, 2010, September 12, 2011, October 3, 2011, November 21, 2011 and January 11, 2012, copies of such news releases are available under the Company’s SEDAR profile at www.sedar.com.  A chart summarizing a comprehensive list of all the holes drilled by the Company to date at Red Mountain will be posted on the Company website at amgold.ca.

The Company expects to file an updated National Instrument 43-101 technical report for its Red Mountain property in the first Quarter of 2012. The updated technical report is expected to incorporate the results from the Company’s 2011 drill program. The current inferred mineral resource estimate for Red Mountain is 79 M tonnes @ 0.52 g/t gold containing 1.32 M troy ounces of gold, utilizing a cut-off grade of 0.2 g/t gold (see the Company’s news release of December 2, 2010 for the first time disclosure of the inferred resource estimate).

Significant Intervals from the 2010 & 2011 Diamond Drill Holes
2010 to 2011 - 12,043 metres


Hole
From (m)
To (m)
Interval (m)
Au (g/t)
**ICE10028
0.0
526.6
526.6
0.75
Including
48.5
149.9
101.4
1.41
Including
87.5
102.0
14.5
4.23
Including
446.0
475.1
29.1
1.25
Including
488.4
508.8
20.4
1.83
**ICE10029
4.5
455.5
451.0
0.58
Including
59.0
97.0
38.1
1.02
Including
365.2
426.2
61.0
0.81
**ICE10030
26.0
294.5
268.5
0.72
Including
27.0
158.8
131.8
0.93
Including
27.0
54.0
27.0
1.37
Including
74.0
111.6
37.6
1.26
**ICE10030
333.5
367.9
34.4
0.32
ICE10031
2.0
169.5
167.5
0.26
Including
2.0
27.0
25.0
0.42
**ICE10032
23.1
342.9
319.8
0.34
**Including
214.5
342.9
128.4
0.23
Including
340.5
342.9
2.4
0.94
**ICE10033
38.1
267.0
228.9
0.57
Including
45.3
57.0
11.8
1.41
Including
130.9
146.0
15.2
1.21
Including
240.0
264.0
24.0
0.89
**ICE10034
19.5
293.0
273.5
0.37
Including
75.4
135.9
60.5
0.57
**ICE10034
365.5
384.7
19.2
0.50
ICE10035
10.5
219.5
209.0
0.21
Including
98.5
147.0
48.5
0.34
**ICE10036
118.0
215.6
97.6
0.39
Including
165.2
199.0
33.8
0.51
ICE10037
20.0
253.0
233.0
0.36
Including
52.0
61.0
9.0
1.44
ICE10037
188.5
253.0
64.5
0.45
Including
247.5
252.98
5.48
0.83
**ICE10038
4.6
368.8
364.2
0.46
Including
124.0
362.0
238.0
0.60
Including
124.0
194.5
70.5
1.16
Including
124.0
144.5
20.5
3.03
**ICE10039
9.5
237.0
227.5
0.34
ICE11040
60.5
157.5
97.0
0.41
Including
62.5
83.5
21.0
0.67
ICE11040
244.8
325.7
80.9
0.47
Including
244.8
282.5
37.7
0.59
ICE11041
2.1
292.5
290.4
0.24
Including
82.5
110.5
28.0
0.56
ICE11042
0.0
287.0
287.0
0.25
Including
63.0
119.5
56.5
0.44
Including
98.0
119.5
21.5
0.74
ICE11043
46.5
387.0
340.5
0.39
Including
300.5
387.0
86.5
0.66
Including
344.7
387.0
42.3
1.07
ICE11044
92.5
120.5
28.0
0.61
Including
92.5
101.5
9.0
1.60
ICE11045
0.0
419.4
419.4
0.38
Including
0.0
323.5
323.5
0.42
Including
8.0
158.5
150.5
0.58
Including
49.5
81.5
32.0
0.69
ICE11046
0.0 
342.9
342.9
0.37
Including
145.0
200.0
55.0
0.60
ICE11047
0.0
350.5
350.5
0.25
Including
7.5
173.0
165.5
0.32
Including
52.5
74.5
22.0
0.51
ICE11048
0.0
160.0
160.0
0.33
Including
81.0*
104.5
23.5
0.66
Including
94.5
104.5
10.0
0.94
ICE11048
120.0
146.5
26.5
0.46
ICE11048
274.0
340.0
66.0
0.31
ICE11049
3.0
57.5
54.5
0.48
ICE11049
116.0
160.0
44.0
0.30
ICE11049
297.0
382.5
85.5
0.48
Including
308.5
329.5
21.0
0.93
ICE11050
12.0
28.5
16.5
0.38
ICE11050
147.0
162.0
15.0
0.67
ICE11050
171.0
201.0
30.0
0.31
Including
171.0
183.7
12.7
0.38
ICE11050
230.5
243.0
12.5
0.43
ICE11050
270.2*
279.5
9.3
0.42
ICE11051
7.5
62.0
54.5
0.44
ICE11051
116.0
128.0
12.0
0.49
ICE11051
174.5
182.0
7.5
0.76
ICE11052
1.5
25.5*
24.0
0.51
ICE11052
96.0
115.0
19.0
0.62
ICE11052
135.5
137.0
1.5
4.10
ICE11052
175.0
184.0
9.0
0.46
ICE11053
1.5
234.0
232.5
0.57
Including
5.5
76.0
70.5
0.74
Including
172.5
199.5
27.0*
1.05*
Including
195.0
196.5
1.5
11.10
ICE11054
1.5
72.3
70.8
0.32
Including
26.0
32.0
6.0
0.60
ICE11054B
27.0
36.0
9.0
0.50
ICE11054B
67.5
117.0
49.5
0.44
Including
96.0
106.5
10.5
0.71
ICE11054B
127.5
145.5
18.0
0.43
Including
127.5
132.0
4.5
0.37
ICE11054B
159.0
181.9
22.9
0.37
ICE11055
4.6
238.2
233.6
0.57
Including
4.6
65.5
60.9
1.06
Including
175.5
193.5
18.0
0.61
ICE11056
0.0
245.5
245.5*
0.36
Including
132.5
245.5
113.0
0.49
ICE11057
38.0
59.0
21.0
0.55
ICE11057
85.5
232.0
146.5
0.39
Including
145.5
212.0
66.5
0.44
ICE11058
3.0
164.0
161.0
0.38
Including
24.0
81.5
57.2
0.50
Including
122.0
146.5
24.5
0.43
ICE11059
3.8
300.2
296.5
0.32
Including
52.5
57.0
4.5
3.83
Including
80.0*
153.0
73.0
0.39
Including
80.0
99.5
19.5
0.47
Including
114.5
147.0
32.5
0.43
ICE11060
19.5
95.0
75.5
0.44
Including
61.0
74.5
13.5
0.63
ICE11060
122.5
201.0*
78.5*
0.45
ICE11061
10.5
41.0
30.5
0.38
Including
13.5
24.0
10.5
0.49
ICE11061
66.5
72.5*
6.0
0.46
ICE11061
98.0
113.0
15.0
0.39
ICE11061
125.0
131.0
6.0
1.56
ICE11061
167.0
253.0
86.0
0.33
Including
171.5
188.0
16.5
0.53
Including
170.0
177.5
7.5
0.77
ICE11061
244.0
253.0
9.0
0.48
ICE11062
42.0
58.5
16.55
0.67
ICE11062
79.0
114.0
35.0
0.38
Including
86.5
94.0
7.5
0.71
Note: Reported Widths Are Drilled Thicknesses.  True Widths Are Not Known.
** Hole Included in the December 2, 2010 inferred mineral resource estimate calculation.
* Revised from the date of initial dissemination to correct non-material adding errors or rounding errors, as the case may be.

All sample preparation and fire assaying work was performed by Eco Tech Laboratory Limited (“Eco Tech”) in Kamloops, British Columbia.  Eco Tech is an ISO 9001:2008 accredited laboratory and subsidiary of the Stewart Group of worldwide laboratories, now owned and operated by ALS. Initial fire assay with atomic absorption finish is completed for all samples.  Those samples running greater than 1g/t Au are automatically rerun.  Those samples assaying in excess of 3g/t Au are rerun using a gravimetric finish.  In addition to the internal laboratory controls, the Company inserts two revolving standards in 3% of the samples, inserts blanks in 4% of the samples, and a duplicate sample is re-split every tenth sample.  Results reported herein have been checked and have undergone quality control review.

About AM Gold Inc.

AM Gold Inc. is a publicly held resource company based in Vancouver, Canada.  The Company is listed on the TSX Venture Exchange under the symbol “AMG” and is quoted on the Frankfurt Exchange under the symbol “AMX”.  The Company is focused on creating shareholder value through the development of the Company’s gold and gold-copper projects in the Yukon and Peru while building a portfolio of quality pipeline projects in North and South America.  The Company’s Red Mountain gold property is located in central Yukon Territory approximately 55 kilometres northwest of the community of Mayo in the Tintina Gold Belt.  The Company’s Red Mountain gold property consists of approximately 3,600 hectares of contiguous quartz claims.  52 of such quartz claims (1,168 hectares) are held 80% by the Company with an option to acquire 100% ownership and are subject to a net smelter returns royalty and 131 quartz claims (2,430 hectares) are held 100% by the Company.  AM Gold’s Pinaya gold-copper project is located approximately 775 kilometres southeast of the city of Lima, Peru in the Tintaya Gold Belt.  The Company maintains 100% ownership of 35 mining concessions covering the 19,200 hectare Pinaya land position.  AM Gold’s corporate offices are located Suite 605 - 369 Terminal Avenue, Vancouver, British Columbia, V6A 4C4 (phone: 604-646-0067).

Dr. Stewart Jackson, P. Geol.  a director of the Company, and a Qualified Person within the meaning of National Instrument 43-101 - Standards of Disclosure for Mineral Projects, has reviewed and approved the technical disclosure contained in this news release.

On behalf of AM Gold Inc.:

“John Fiorino” 
John Fiorino
CEO
AM GOLD INC.
For further information on AM Gold, please contact Murray Caruth at 1-604-646-0067 or by email at , or visit AM Gold’s website at: http://amgold.ca.

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.

Cautionary Statement Regarding “Forward-Looking” Information

Some of the statements contained in this press release are forward-looking statements and information within the meaning of applicable securities laws. Forward-looking statements and information can be identified by the use of words such as “expects”, “intends”, “is expected”, “potential”, “suggests” or variations of such words or phrases, or statements that certain actions, events or results “may”, “could”, “should”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements and information are not historical facts and are subject to a number of risks and uncertainties beyond AM Gold’s control. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this news release. Accordingly, readers should not place undue reliance on forward-looking statements.  The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except as may be required by law.

 
     
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