Salmon River Announces US$2 Million Loan

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.
Salmon River Resources Ltd. (TSXV:SAL)
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