Salmon River announces US$2 million loan

VANCOUVER, BRITISH COLUMBIA–(Marketwire – Feb. 9, 2012) – Salmon River Resources Ltd. ("Salmon River" or the "Company") (TSX VENTURE:SAL) is pleased to announce that it has entered into a loan agreement (the "Loan Agreement") with Rigdon Limited ("Rigdon"), pursuant to which Rigdon has agreed to lend the Company US$2,000,000 (the "Loan"). The Loan will be unsecured, mature six months from utilisation and bear interest at a rate equal to LIBOR plus 9.0% per annum.

Pursuant to the Loan Agreement, the Company has granted Rigdon an option to enter into an off-take agreement with the Company pursuant to which Rigdon shall have priority rights to purchase up to 1,000,000 tonnes per annum of iron ore mined from the Treppo Grande's principal tenements, namely EL77/1209 and EL77/1208, on market terms, for a 10-year period (the "Off-Take").
For a period of two months from the date of the Loan Agreement, Salmon River has agreed not to enter into any new negotiations with third parties in conflict or competition with any proposal under discussion with Rigdon or its affiliates. Such negotiations will be subject to strict confidentiality and Salmon River expects to provide further information and updates in the near future.

Updates

On December 29, 2011, Salmon River issued a press release (the "December 29 Press Release") announcing a private placement for up to C$1,100,000 (up to 3,437,500 common shares at C$0.32 per share) (the "Private Placement"). The Company hopes to shortly close the Private Placement, raising gross proceeds of C$1,100,000 on or about February 9, 2012. Pursuant to the December 29 Press Release certain insiders of the Company had already made their investments in the Private Placement prior to any discussions with Rigdon or its parent company.

The December 29 Press Release also announced changes to the option agreement to acquire Treppo Grande Iron Pty Ltd. (the "Treppo Grande Option")pursuant to which the Company extended payment terms and agreed to make monthly payments of A$1 million(the "Option Amendment") until 30 April 2012, when the full remaining payments are due (the "Completion Date"). (Please see the December 29 Press Release for details relating to the Option Agreement, the Option Amendment and related terms, and the Company's press releases dated December 15, 2011 and November 4, 2011 for additional background details relating to the Treppo Grande Option and the Company's funding plans.) Pursuant to the Option Amendment, the Company is required pay to the Seller A$1,000,000 on the last day of each month starting December 31, 2011 and until the Completion Date (the "Pre-Completion Payments").

The first Pre-Completion Payment was due on December 31, 2011 and was paid using the proceeds from a loan from the Bank of Montreal (the "BMO Loan"). The Company placed an equivalent amount of funds in a reserve account with the Bank of Montreal, as collateral for the BMO Loan. The Company expects to repay the BMO Loan from the proceeds of the Loan and/or Private Placement. The funds in the reserve account will be released upon such repayment and will be used by the Company for working capital and general corporate purposes. The proceeds from the released funds, the Loan and/or the Private Placement will also be applied to meet the Pre-Completion Payments as and when due for payment.

The Company issued a press release on December 20, 2011 announcing the initial Mineral Resource estimate for the first phase drilling program at its Mount Manning North Iron Ore project in the Yilgarn region of Western Australia. The Company wishes to announce that on February 7, 2012 it filed a technical report compliant with National Instrument 43-101 on SEDAR.
About Salmon River Resources Limited (TSX VENTURE:SAL)
Salmon River Resources Limited is a mineral exploration company engaged in the exploration for and development of commercial deposits of iron ore in Western Australia. It exercised its option to acquire five tenements in the Yilgarn region of Western Australia including the Treppo Grande iron ore project, approximately 210 kilometres northwest of Kalgoorlie, comprising two tenements covering Mt Manning (298 km2) and the Barlee tenement (98.7 km2). Completion of the acquisition of the tenements is subject to certain conditions, including payment of A$100 million to the optionor. Salmon River believes the Treppo Grande project has the potential to be a world-class iron ore deposit with early development potential. Salmon River has recently announced the signing of a Memorandum of Understanding with General Steel Holdings Inc. ("General Steel") (NYSE:GSI) providing for substantial future financing, off- take arrangements and the provision of management oversight (see press release dated 4 November 2011). The shares of Salmon River are listed on the TSX Venture Exchange under the symbol "SAL".

On behalf of the Board of Directors of SALMON RIVER RESOURCES LTD.

J.G. Stewart, President

Forward-Looking Statements: This press release contains forward-looking statements that are based on the beliefs of management and reflect Salmon River's current expectations. The forward-looking statements in this press release, and the press releases on November 4, 2011 and December 15, 2011 referred to above, include information relating to Salmon River expecting to close the Private Placement and the Loan, repay the BMO Loan, and make additional Pre-Completion Payments; the Company's intentions with respect to funding the purchase of Treppo Grande Iron Pty Ltd, including potential funding from General Steel; and the development of the Treppo Grande iron ore project. The forward- looking statements are based on certain assumptions, which could change materially in the future, including the assumption that the Private Placement and the Loan agreement will close, additional Pre- Completion Payments will be paid as and when they are due, that Salmon River will complete definitive agreements providing funds for the exercise of the Treppo Grande Option, and that Salmon River will exercise its rights under the Treppo Grande Option. By their nature, forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include the risk that Salmon River may not complete the intended financings to fund the exercise of the Treppo Grande Option. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, investors should not place undue reliance on forward-looking information. Forward-looking information is provided as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required in accordance with applicable laws.
There is no guarantee that Salmon River will complete the exercise of the Treppo Grande Option before April 30, 2012, or at all. The completion of the exercise of the Treppo Grande Option is subject to the satisfaction of certain regulatory requirements and other conditions. In addition, the Company will have to complete additional financings for approximately A$110,000,000. There can be no certainty, nor can the Company provide any assurance, that these conditions will be satisfied or, if satisfied, when they will be satisfied, or if the additional financings will be completed. The Treppo Grande Option Agreement represents substantially all of the Company's assets, and if the Company is unable to complete the option exercise, shareholders of Salmon River will have suffered significant dilution without the Company having received the Treppo Grande Iron Pty Ltd shares or acquired the mining tenements owned by Treppo Grande Iron Pty Ltd.
 Neither 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.