Avala Resources Updates on Bigar Hill, Serbia

Avala Resources Ltd. has provided an update on progress and drill results from the Korkan-Bigar trend, part of the sediment-hosted gold belt within the Cretaceous magmatic arc bordering the Timok Magmatic Complex in Eastern Serbia.

"With these initial reverse circulation infill drilling results we are starting to establish continuity of stratabound mineralization at Bigar Hill, which is an important milestone for the sediment-hosted gold project", said James Crombie, President and CEO of Avala. "In addition, our ongoing wide-spaced, exploration diamond drilling program continues to grow the overall mineralized footprint at the Korkan target area together with advancing our other recently discovered target areas which are located in close proximity to the resource definition drilling areas."

HIGHLIGHTS

• Resource definition drilling continues with a Reverse Circulation (RC) drill rig (GEMEX RC-500) on the Korkan-Bigar trend, initially drilling the Bigar Hill target area.
   
• The resource definition program is focused on establishing continuity of mineralization, with a nominal 80 meter by 80 meter grid spacing within the mineralized 'footprints' which have been outlined by Avala during the earlier, wide-spaced, 160 meter by 160 meter diamond drilling programs, which started in August, 2010.
   
• Resource definition RC drilling at Bigar Hill returned the following strong to moderate gold intercepts (0.4g/t cut-off grade).

• The reverse circulation-diamond 'twin' drill holes drilled to date have confirmed that the majority of mineralized intercepts and hence the deposit style, is dominated by layer-parallel, lithology-controlled gold mineralization at Bigar Hill.
   
• There is evidence of steeper mineralized structures in addition to the dominant, stratigraphically controlled, gold mineralization. These intersections represent a 'bonus' and are likely to be intersected in greater numbers as the infill drilling program progresses.
   
• Wide-spaced 'step out' drilling (nominal 160 meter by 160 meter) on the Korkan-Bigar trend continues to intersect gold mineralization within the target stratigraphy, a sequence of strongly altered and decarbonatized conglomerates and sandstones with interbedded fine grained sandstone and clay-rich siltstones, marls, andesitic volcanics and derivative clastic rocks.
   
• Drilling on the Korkan target area returned the following strong gold intercept (0.4g/t cut-off grade), from the north-eastern edge of the wide-spaced drilling grid; mineralization remains demonstrably open in this direction.

• Exploration drilling continues to test new target areas, located in close proximity to the Korkan and Bigar Hill mineralized 'footprints'.

• Exploration drilling on the Bigar East target area, located approximately 800 meters east-southeast of the Bigar Hill zone returned the following gold intercepts (0.4g/t cut-off grade).

• Exploration drilling on the Rapture Fault Zone, located approximately 700 meters southwest of the Bigar Hill zone returned the following broad, low grade, gold intercepts (0.4g/t cut-off grade).

• To date, Avala has outlined gold mineralization at Korkan over an area of approximately 1,200 meters by 600 meters surrounding the original discovery hole (open to the east and north-east) and an area of 1,000 meters by 1,000 meters on the Bigar Hill target area (open in all directions). Kraku Pestar has been traced over 600 meters by 300 meters and is open to the north and south.
   
• Additional target areas have been identified within 3 kilometres of the core Korkan-Bigar Hill area, in similar target stratigraphy.
   
• Avala intends to continue the wide-spaced drilling program, in conjunction with the recently commenced resource definition program, in order to test the prospective 'target stratigraphy' within the Korkan-Bigar trend, to effectively outline the size of the newly defined sediment-hosted gold system.
   
• The combined Korkan-Bigar trend is over 10 kilometers long and 2.5 kilometers wide and represents only part of the northern portion of the sediment-hosted gold belt.
   
• Avala currently has seven diamond drill rigs and one RC drill rig operating on the sediment-hosted gold belt. One diamond drill rig has been allocated to an area in the southern portion of the sediment-hosted gold belt, on the Umka-Strnjak trend, where scout drill holes are being drilled on nominal 320 meter by 320 meter centers within the target stratigraphy. The remainder of the drill rigs are operating on the Korkan-Bigar trend.