New Gold Inc. (NGD)

[Kristallweizen]

New Gold Monetizes a Portion of its Asset Backed Notes

VANCOUVER, Dec. 23 /CNW/ - New Gold Inc. ("New Gold") (TSX and NYSE AMEX-NGD) today announces the sale of C$56.3 million of face value asset backed notes for cash proceeds of C$31.2 million. Three classes of notes were sold:

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- C$32.9 million of face value MAV II Class A-1 notes for
C$19.1 million

- C$18.3 million of face value MAV II Class A-2 notes for C$8.4 million

- C$5.1 million of face value MAV II Class 15 notes for C$3.7 million
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New Gold was able to realize a weighted average price of C$0.55 per dollar through the monetization of this portion of the company's notes and will recognize a loss on disposal of approximately C$4.3 million during the fourth quarter. Of New Gold's remaining C$104.0 million in face value notes, C$83.1 million, or 80%, are in the MAV II Class A-1 and A-2 category which are considered to be the most secure of the asset backed notes from a credit perspective.

"We are very pleased that we have been able to successfully monetize this portion of our notes at a value far greater than where the market was just a few months ago," said Brian Penny, Chief Financial Officer. "Realizing this additional cash well in advance of the 2016 maturity date of the notes only further enhances our financial flexibility and the strength of our balance sheet."

The total proceeds of C$31.2 million will further improve the company's cash balance and working capital.

About New Gold

New Gold is an intermediate gold mining company with the Mesquite Mine in the United States, Cerro San Pedro Mine in Mexico and Peak Mines in Australia. The company is expected to produce between 270,000 and 300,000 ounces of gold in 2009 growing to over 400,000 ounces in 2012. In addition, New Gold has a strong portfolio of mining, development and exploration assets in mining friendly jurisdictions. For further information on the company, please visit www.newgold.com.