New Gold Intersects 278 Metres of 2.8 Grams per Tonne Gold at Blackwater Project

08/09/2011

VANCOUVER, Aug. 9, 2011 /CNW/ - New Gold Inc. ("New Gold") (TSX:NGD)(NYSE AMEX:NGD) today announces the drill results for 12 additional holes and four metallurgical holes on its Blackwater Project in central British Columbia. The latest results are a continuation of New Gold's aggressive drill program at Blackwater where the company now has assays for a total of 66 additional holes since the completion of the project's initial March 2011 resource estimate. Today's results include infill and step-out holes drilled within and around the currently defined mineral resource. Highlights include:

"The latest results are a continuation of our efforts to identify the edges of the deposit while also focusing on infill drilling in the core of the already established resource," stated Mark Petersen, Vice President, Exploration. "We are excited about the results, in particular the higher grades seen in holes 176 and 179 and the extension of significant gold grades to the southwest as identified in hole 180."

The four metallurgical holes completed were drilled in four separate areas of the deposit to generate representative bulk samples for testing. A detailed map highlighting the latest 12 holes and four metallurgical holes is available on New Gold's website at www.newgold.com.

As previously announced New Gold has increased the drill program for the project and plans to drill 40,000 to 50,000 metres, or approximately 100 holes, in the second half of 2011. New Gold's exploration program will target both the 100%-owned southern portion of the project and the 75%-owned northern portion, where Silver Quest Resources Ltd. owns the remaining 25%. The planned camp expansion is progressing on schedule to support as many as eight to ten drills by the middle of the fourth quarter of 2011. There are currently five drills active at site. In addition to the ongoing drilling, the company plans to complete a detailed IP-Resistivity Survey in the fall to explore for extensions to the deposit.