30% Increase In Indicated Resources At Blackwater

VANCOUVER - New Gold Inc. reported an updated National Instrument 43-101 compliant mineral resource estimate for its Blackwater Gold Project in central British Columbia. This latest resource update incorporates an additional four and a half months of drill hole data added to the project's resource database when compared to the previous estimate announced in March 2012. With this additional data, the indicated and inferred mineral resources have increased by 30%, or 1.7 million ounces of gold, and 7%, or 0.2 million ounces of gold, respectively. The resource estimate now includes all drilling through May 14, 2012, adding 151 holes totaling 57,064 metres since the March 2012 estimate. In total, the current Blackwater mineral resource estimate is supported by analytical data received from 417 holes totaling 147,619 metres. An additional 32 holes supplied geologic information, but assays had not been received by the cut-off date for this July resource estimate.

Indicated mineral resource: 230 million tonnes at an average grade of 0.96 grams gold per tonne containing 7.1 million ounces of gold at a 0.40 gold-equivalent gram per tonne cut-off grade; Inferred mineral resource: 98 million tonnes at an average grade of 0.77 grams gold per tonne containing 2.5 million ounces of gold at a 0.40 gold-equivalent gram per tonne cut-off grade.

As this latest resource estimate provides New Gold with additional information regarding the continuously evolving Blackwater mineral resource, the company plans to use this July resource estimate, rather than the March 2012 estimate, as the basis for its Preliminary Economic Assessment ("PEA"). The PEA is targeted for completion in September 2012.

"We are very pleased with the continued resource growth rate at Blackwater," stated Mark Petersen, Vice President Exploration. "To see the indicated resource grow by 1.7 million ounces in four and a half months is remarkably gratifying and speaks to the quality of our team at Blackwater and the continued potential of this deposit. We look forward to continuing to build on this momentum through the remainder of 2012 and beyond."

The additional assays received further demonstrate strong continuity of gold mineralization as the mineral resource continues to expand, particularly to the north and northwest. Beyond the positive gold-related results, the recent assays have also returned some of the highest silver grades found on the deposit to date. As a result, the inferred silver grades have increased by 103%, to 7.7 grams per tonne, when compared to the March 2012 mineral resource estimate. These results occur within a zone of higher grade silver mineralization along the outer northwestern portion of the mineral resource. This zone offers excellent potential for expanding the silver mineral resources at Blackwater and is an area of focus for renewed exploration drilling by the company.

New Gold currently has 18 drills actively exploring at the project. With 13 drills conducting resource delineation and infill drilling at the primary Blackwater deposit, New Gold remains well on track to fulfill its 2012 program, where the company is targeting the completion of approximately 500 holes totaling over 200,000 metres. The company's exploration efforts on its broader property position have also been accelerated. Three drills are testing the mineral potential of proposed infrastructure sites and two drills are exploring the potential to expand the Capoose gold-silver deposit located approximately 25 kilometres from Blackwater. In addition, the Blackwater regional exploration program has commenced with reconnaissance mapping and geochemical sampling on the company's 1,000 square kilometre land position.