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Kivalliq Reports 2.24% U3O8 over 1.5 metres from the Lac Cinquante Deposit: New 3-D Model of the Deposit Reveals Potential for Expansion along Trend and at Depth

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January 15, 2009

Vancouver, B.C. - Kivalliq Energy Corporation (KIV: TSX-V) is pleased to report further results of an initial exploration program on the near-surface, historical 11.6 million pound** uranium deposit at Lac Cinquante, Nunavut. Results from logging and assaying of historical drill core as well as new computerized modeling of the deposit are reported here and results from the regional exploration of the greater Angilak property are being compiled and will be released when ready.

2008 Lac Cinquante Highlights

“These results represent some of the highest uranium assays ever reported from the region, demonstrating that Lac Cinquante is one  of  the most exciting, undeveloped, historical uranium deposits in Canada,” stated John Robins, Kivalliq’s President and CEO.  “Kivalliq now has all the tools needed to begin a drilling program in order to bring the deposit compliant with NI 43-101 as well as expand the size of the deposit.”

New 3-D Model

The main objectives of the 2008 field program were to reconstruct previous drilling, confirm reported uranium mineralization and prepare a conceptual 3-D model for the Lac Cinquante Deposit. By re-establishing the original ground grid and locating a number of labelled drill collars, Kivalliq was able to confidently identify 106 of 123 drill collars located in the field. Core for the majority of these holes was found preserved, legible and in good condition at the east end of the grid. Select core was catalogued, logged and the Main Zone was identified by testing previously sampled or mineralized intervals with a GR-135 gamma-ray spectrometer or RS-121 gamma-ray scintillometer.  In order to verify readings and corroborate uranium grades reported for Lac Cinquante, eight samples were selected from six drill holes that intersected the Main Zone.

By combining new ground geophysical data, historical drill information, relocating drill collars and new testing on core, Kivalliq has been able to construct a preliminary 3-D model for the Lac Cinquante uranium deposit.  Core photos, a drill plan, VLF data and the conceptual 3-D model for Lac Cinquante can be viewed at www.kivalliqenergy.com. The model shows the possible extent of uranium mineralization at the Main Zone with mineralization open in all directions.  This model is conceptual in nature and will only be used as a visualization tool to guide future exploration. It is not intended for NI 43-101 reporting, resource calculations or estimates. 

Historical Drill Core 

Historical drill core from the early 1980’s drilling was located in the field and a number of holes were re-logged and sampled. Kivalliq’s team successfully located drill collars and core that were previously assayed and later reported by the Geological Survey of Canada (GSC) in 1986 (CIMM Special Paper #33, p. 263 to 285). Re-assay of these same intervals by Kivalliq corroborated or improved on the previously published GSC results. Table 1 outlines Kivalliq’s 2008 assay results.

Table 1.  2008 Assay Results: Re-Sampling of Historic Lac Cinquante Drill Core

DDH

From (m)

To (m)

Length (m)

*%U3O8

**oz/T Ag

%Mo

%Cu

YUC24

73.0

74.5

1.5

2.24

0.78

0.17

0.03

Including

73.0

73.5

0.5

2.51

0.90

0.22

0.04

and

73.5

74.0

0.5

4.16

1.38

0.27

0.03

and

74.0

74.5

0.5

0.06

0.06

0.03

0.01

YUA50

60.5

61.5

1.0

1.90

1.18

0.33

0.15

YUA104

125.4

126.7

1.3

0.60

0.51

0.07

0.11

YUB17

147.5

148.0

0.5

0.20

0.14

0.03

0.02

YUB23

183.2

184.2

1.0

0.30

0.09

0.06

0.02

YUB55

97.6

98.6

1.0

0.14

0.06

0.00

0.01

*Uranium results reported in ppm.  Calculation used to convert ppm U to % U3O8 is: 10,000 ppm = 1% U = 1.179% U3O8
**Silver results reported in ppm. Calculation used to covert ppm Ag to oz/T Ag is: 1ppm Ag = 1gm/t Ag x 0.029 = troy ounces per short Ton Ag

QA/QC

A total of eight core samples were collected in 0.5 to 1.3 metre intervals from labelled historic split BQ sized core and shipped to Activation Laboratories Ltd. (Actlabs) in Ancaster, Ontario for geochemical analysis. Rock samples were dried, crushed/pulverized, split and analyzed using both total digestion ICP and INAA techniques. Samples with uranium and copper values exceeding initial detection limits (10,000 ppm) were re-assayed using fusion-XRF and ICP-OES methods respectively.  QA/QC was assured by the systematic use of blanks, reference samples and pulp splits. Actlabs is one of only two laboratories in North America with both ISO/IEC 17025 and CAN-P-1579 accreditation.

GeoVector Management Ltd. of Ottawa, Ontario was contracted to oversee technical aspects of the Angilak Project.  Joe Campbell, P.Geo is the Qualified Person for the purposes of National Instrument 43-101 and has reviewed the technical content of this news release. Disclosure of a technical nature contained in this release has also been reviewed and approved by Jeff Ward, P.Geo (Vice President Exploration of Kivalliq) and Rob Carpenter Ph.D., P.Geo (Chairman of Kivalliq) who are also Qualified Persons for the purposes of National Instrument 43-101.

As stated in the November 12, 2008 press release, Kivalliq confirms it has issued 250,000 common shares to Canaccord Capital Corporation in consideration of certain services provided.  The shares have a deemed value of $0.25 per share and are subject to a four month hold period.


About Kivalliq Energy

Kivalliq Energy Corporation is a new uranium exploration and development company with a unique opportunity. Kivalliq is the first company in Canada to sign a comprehensive agreement to explore on Inuit Owned Lands for uranium. Through this landmark partnership with the Inuit of Nunavut, Kivalliq is now exploring and developing the historic Lac Cinquante Uranium Deposit, one of Canada’s most attractive, high-grade, historical uranium deposits. Reported to contain 11.6 million pounds of uranium oxide with grades averaging 1.03% U3O8 (non compliant with National Instrument 43-101) **, the historic Lac Cinquante Deposit and 75 other uranium occurrences on the property comprise Kivalliq’s core asset, the 270,000 acre Angilak Project.

On behalf of the Board of Directors

“John Robins”

John Robins, P.Geo
President and CEO
Kivalliq Energy Corporation

For further information about, Kivalliq Energy Corporation or this news release, please visit our website at www.kivalliqenergy.com or contact Tony Reda, Investor Relations, at toll free 1.888.331.2269, directly at 604.646.4534 or by email at info@kivalliqenergy.com.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

** The quoted disclosure for the Lac Cinquante Uranium Deposit was prepared by Aberford Resources Ltd and referenced by subsequent sources.  It is a historical estimate as defined in National Instrument 43-101, but should not be relied upon since it does comply with standards of disclosure required for reserves and resources stated therein. However, it is relevant because: it is indicative of a mineralized zone worthy of follow-up exploration as it is based on drilling and surface exploration  carried out by what is believed to be knowledgeable explorers in accordance with acceptable industry practices at the time of the estimate. A Qualified Person has not classified historical estimates as current mineral resources/reserves, and Kivalliq is not treating them as current mineral resources/reserves since work to date has not verified the historical estimates. Kivalliq has not done any work to confirm these estimates but will be planning exploration programs aimed at evaluating the economic potential of the deposit and environs. It is uncertain if further exploration will result in the deposit being delineated as a mineral resource.        

Certain disclosures in this release, including management's assessment of plans and projects and intentions with respect to listings of securities, use of proceeds and future exploration programs, constitute forward-looking statements that are subject to numerous risks, uncertainties and other factors relating to Kivalliq's operations as a mineral exploration company that may cause future results to differ materially from those expressed or implied in such forward-looking statements, including risks as to the completion of the plans and projects. Readers are cautioned not to place undue reliance on forward-looking statements. Kivalliq expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.