KAI Kenai Resources Ltd.

Kenai Resources Ltd. ("Kenai") (TSX VENTURE:KAI) is pleased to provide the
following update on the Sao Chico gold project in north central Brazil. 




--  Mining operations commenced earlier in the year for the trial mining
    phase at the permit rate of 50,000 tons per annum, initially with
    surface mining. 
--  The recently installed gravity gold trial processing plant was
    commissioned, demonstrating the ability to reach design throughput
    capacity of 10 tonnes per hour of feed treating oxidized surface
    material. 
--  Initial plant feed gold ore grades were low, attributable to a lack of
    defined Mineral Resources or Mineral Reserves (as those terms are
    defined pursuant to National Instrument NI 43-101) making grade control
    difficult, and the inability to mine very narrow gold-bearing veins with
    a high degree of selectivity. 
--  Modifications are being made to surface mining practices to minimize the
    degree of excessive dilution of ore with waste rock.  
--  Plant commissioning indicated the need for additional size reduction of
    ore feed, by finer grinding of the ore feed. 
--  Plant operations have been suspended since June, allowing for plant
    modifications, including the installation of a grinding mill and other
    gravity circuit changes. Recommencement of processing is scheduled
    during August. 
--  Further underground sampling results have confirmed excellent gold
    grades in the quartz/sulphide vein structure. Metallurgical test work
    results are awaited from this sampling during August. 
--  A diamond drilling program is planned for commencement in August with
    the objective of confirming the high grade quartz/sulphide hard rock
    vein potential at Sao Chico.



Modifications to Kenai's Option Agreement with Gold Anomaly

Under its original September 21st, 2010 Option Agreement ("Original Agreement")
with Gold Anomaly Limited ("GOA"), the owner of the rights to the Sao Chico
project, Kenai has to date advanced A$2.5m in loan funds to GOA.


Kenai has executed an August 5th, 2011 agreement with GOA, formalizing changes
agreed to since the Original Agreement, and triggering the release of A$1.0m in
further loan funds from Kenai to GOA for the Sao Chico project resulting in a
total of A$3.5m in loan funds to GOA.  The material changes to the original
terms agreed under the recent agreement include the following: 




--  Kenai's option to acquire 50% of GOA's wholly owned subsidiary holding
    the mineral project rights to Sao Chico are is exercisable by September
    3rd, 2012, or about four months later than originally provided for.  A
    "Second Option" to acquire an additional 25% remains, for exercise by
    Kenai up to 24 months after the exercise by Kenai of the initial 50%
    option. 
--  Kenai has agreed to advance a further loan of A$500,000 of loan funds
    (from the original A$3m to A$3.5m). Should Kenai exercise the Second
    Option, then these funds will be treated as a part-payment (of a total
    of A$2m) towards the exercise of that Second Option. If the Second
    Option is not exercised, the $0.5m will remain loan funds. Kenai
    continues to provide project management advisory services for Sao Chico
    to GOA. 
--  Kenai will assume a direct project management role if it exercises its
    50% equity option. 



About Sao Chico:

The project is more completely described in Kenai's NI 43-101 Technical Report
on the project, details of which were contained in Kenai's news release of
January 20, 2011. It has since been filed on SEDAR and on Kenai's website at
www.kenairesources.com. 


Sao Chico is located within the Tapajos region in Brazil, the site of one of the
biggest gold rushes in recent history. In the late 1970s and 1980s,
approximately 500,000 garimpeiros rushed to the region to exploit extensive
areas of newly discovered alluvial gold, producing approximately 20-30 million
ounces of gold before the easily won alluvial gold deposits were largely
depleted. Despite the gold rush, little modern exploration has been conducted
over the region to date, with excellent potential to expand gold operations at
Sao Chico. The Sao Chico project team has extensive experience and expertise of
operating within the region, which will provide a focussed and systematic effort
to gold production and exploration at Sao Chico. 


As previously advised, Gold Anomaly via a wholly owned subsidiary will receive
all cash flow generated by GOAB at Sao Chico until Kenai exercises its options
to acquire 50% and then 75% equity in the Sao Chico mineral rights to the Sao
Chico project.


About Kenai Resources:

Kenai is a Canadian company focused on precious mineral project exploration and
development, towards early significant gold production. In addition to the Sao
Chico gold project in Brazil, Kenai is also involved in exploration of the
wholly-owned Quartz Mountain and Hope Butte epithermal gold projects in
South-Eastern Oregon, both located in Malheur County, close to the Oregon border
with Idaho. Kenai's current indicated and historical gold resources from the two
Oregon projects are summarized as follows:




Project              Tonnes       Grade Ounces Au      Status/Classification
                                                         Indicated Resources
Quartz Mountain  15,050,200 0.80 g/t Au   352,667         NI43-101 compliant
                                                                 Historical,
Hope Butte        5,000,000 0.91 g/t Au   146,300    not NI 43-101 compliant



Footnotes: 



1.  For Quartz Mountain, resources above a 0.34 g/t cutoff with silver
    converted to gold equivalent using a ratio of 49.5:1 silver to gold.
    Metallurgical recoveries were not considered. Indicated resources are as
    reported in an independent November 2006 NI 43-101 report, posted on
    SEDAR at that time. 
2.  The Hope Butte resources are considered historic in nature, do not
    comply with current NI 43-101 standards, have not been verified by the
    Company and therefore should not be relied upon. It is uncertain if
    further exploration will result in the discovery of an economic mineral
    resource.



On behalf of the Board of Directors of Kenai Resources Ltd.

Greg Starr, President and CEO

Forward-Looking Statements: Statements in this release that are forward-looking
statements are subject to various risks and uncertainties concerning the
specific factors disclosed and elsewhere in the Company's periodic filings with
Canadian securities regulators. The economic viabilities of the resources
estimates discussed in the release have not been established and may not be.
Such information contained herein represents management's best judgment as of
the date hereof based on information currently available. The Company does not
assume the obligation to update any forward-looking statement.


The technical content of this news release has been reviewed by Kenai's Vice
President Technical Services, Neil Cole, who has sufficient experience which is
relevant to the style of mineralization under consideration and to the activity
which is being undertaken and planned to qualify as a Qualified Person under NI
43-101.


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