Vancouver, B.C., December 31, 2009 – Newstrike Capital Inc. (“Newstrike” or the

“Company”) – www.newstrikecapital.com – is pleased to announce it has entered into a

definitive share purchase agreement dated December 31, 2009 to acquire 21.2% of the

Morelos Project from Desarrollos Mineros San Luis, S.A. de C.V. (“DMSL”), a wholly owned

subsidiary company of Goldcorp Inc. (TSX:G, NYSE:GG) for a purchase price of

not less than $52 million comprised of $44.5 million in cash and 15 million common

shares in Newstrike.

Closing of the transaction is expected in early 2010 and is subject to receipt of all

required shareholder, regulatory and third party consents, satisfaction of customary

closing conditions and the completion by Newstrike of a financing to raise net proceeds

of $50 million. In addition, Gleichen Resources Ltd. has a right of first refusal in respect

of DMSL’s interest in the Morelos Project, exercisable for 90 days from the date it is

advised of the terms of the Newstrike agreement.  Further particulars regarding the transaction are disclosed in the Company’s December 1, 2009 press release.

It’s easy to forget that that the silver found in the ring around your finger, the arm of your eyeglasses, or the spoon you use at dinner is part of a rich history reaching back to the ancient civilizations of Greece and Rome who used silver to control bodily infection and prevent food spoilage. In the fifth century B.C., Hippocrates (known as the Father of Medicine) used silver to heal wounds. In the same century, the King of Persia used a silver container to carry water to prevent contamination. Before the advent of modern germicides and antibiotics, it was known that disease-causing pathogens could not survive in the presence of silver. Consequently, silver was used in dishware, drinking vessels and eating utensils. Approximately seven decades before the birth of Christ, the Roman scholar Pliny the Elder wrote of the ability of silver to heal wounds by preventing infection. In the 8th through 10th centuries, silver became a very popular treatment in the Middle East for many ailments, from cardiovascular disease to bad breath.

It wasn’t until the late 1800′s did western scientists re-discover what had been known for thousands of years – that silver is a powerful germ fighter. Medicinal silver compounds were then developed and silver became commonly used as a medicine. By the early part of the 1900s, Silver leaf was used to combat infection in wounds sustained by troops during World War I and the use of silver as an antibacterial substance was becoming widespread. By 1940 there were approximately four dozen different silver compounds on the market being used to treat every known infectious disease. During the 1930s, synthetically manufactured drugs began to make their appearance and the profits, together with the simplicities of manufacturing this new source of treatment, became a powerful force in the marketplace. There was much excitement over the new ‘wonder drugs’ and at that time, no antibiotic-resistant strains of disease organisms had surfaced. However, over the next few decades silver quickly lost its status to modern antibiotics.

The return of silver to conventional medicine began in the 1970s. The late Dr. Carl Moyer, chairman of Washington University’s Department of Surgery, received a grant to develop better methods of treatment for burn victims. Reviewing earlier medical literature, Dr. Margraf found continual references to the use of silver. However, since concentrated silver nitrate is both corrosive and painful, he diluted the silver to a .5 percent solution and found that it killed invasive burn bacteria and permitted wounds to heal. Importantly, resistant strains did not appear. But, silver nitrate was far from ideal. So research continued for more suitable silver preparations. Silver sulphadiazine is now used in 70 percent of burn centers in America.

Information Sourced from: www.purestcolloids.com/ and www.thesilverinstitute.org

There’s an old saying that goes “gold is where you find it.” This may seem overly simplistic, but it makes sense when considering that many companies have had success recently by exploring near and beneath past workings in Mexico. After all, historic mining regions are historic for a reason. Spanish conquistadors mined metal deposits in Mexico for over 300 years, but thanks to modern exploration technologies Mexico still offers tremendous discovery opportunities.

Veins of gold and silver have stretched their way across the history of Mexico since Columbus discovered this “New World.” Mexico is home to many historic mining districts, one of which is the Valley of Oaxaca. Located at the convergence of the Sierra Madre Oriental and the Sierra Madre del Sur mountain ranges, the history of Oaxaca traces its roots as far back as seven thousand years, when the land was occupied by as many as 18 diverse ethnic groups. Three of the most dominant groups were the Mixtecs, the Mixe and the Zapotecs. During the Zapoteca era, economic activity flourished with increasing hunting, fishing, mining, and artisan work fashioning silver and gold. Along with its ideal location as the gateway to Central and South America, the abundance of gold in Oaxaca is the reason for Oaxaca’s colonial era gain in prominence.

In the mid 1500’s, Hernán Cortés sent men into the Oaxaca region in search of gold and a waterway to the Pacific Ocean. They never found the waterway, but gold would serve as a driving force throughout Cortés’ life and Oaxaca’s history.  In the late 1800’s, over 50 near surface mines were in production as the area grew into one of Mexico’s most important gold producers.

Newstrike is the largest holder of mineral claims in Oaxaca, the key assets being 74,000 hectares in Taviche, Lachigalla, and Ejutla mining districts. Recent discoveries in Oaxaca have been sizable, Newstrike’s claims are in proximity to Fortuna Silver’s San Jose project, which contains over 124 million ounces of silver and 1.05 million ounces of gold. Newstrike’s Etujla II claim  is also contiguous on its southern boundary with Aura Silver’s Alma Delia property, host to a recently discovered Higo Blanco silver mineralized jasperoid breccia which occurs in one of the many veins of the Taviche system.