23 Aug, 10

New Pacific Offer for Tagish Lake Gold Corp. – Update


VANCOUVER, BRITISH COLUMBIA – (August 23, 2010) – New Pacific Metals Corp. (TSX-V: NUX) today provided an update on the take-over bid by New Pacific (the “New Pacific Offer”) to acquire all of the shares (“Shares”) and the offer to acquire all proven secured and unsecured debt (“Debt”) of Tagish Lake Gold Corp. (TSX-V: TLG) (“Tagish”).

Lock up signed with Founder, Former Chair and CEO of Tagish

New Pacific is pleased to report that it has entered into a lockup agreement with Greg Hawkins, the founder and a former Chairman and Chief Executive Officer of Tagish and one of the largest shareholders of Tagish. The lockup agreement covers approximately five million Tagish common shares representing approximately 3.4% of the outstanding shares of Tagish.

“This lockup agreement supports my long-term commitment to see Tagish realize its potential,” said Greg Hawkins. “I fully support and have confidence in the ability of New Pacific’s management team to succeed in advancing the Skukum property into production. Dr. Feng, New Pacific’s President, has a proven track record for operational success in bringing high grade, narrow vein mines into production effectively and his business plan reflects the principles we originally developed for the Skukum Project. The New Pacific Offer represents the best route to help revitalize the Company and recognize Tagish shareholder value. It provides certainty, and a solution to remove Tagish from Companies Creditors Arrangement Act protection. The New Pacific Offer provides an attractive premium to the recent Tagish share price, with a choice that enables Tagish shareholders the option to cash out or to participate in the development of Tagish’s Skukum Property by becoming New Pacific shareholders.”

Shareholder Rights Plan cannot be approved by Tagish Lake Shareholders

On July 8, 2010 Tagish Lake announced that the TSX Venture Exchange had approved the Shareholder Rights Plan (“SRP”) and that the SRP had been effective since March 15th , but would terminate if it is not approved by the Company’s shareholders on or before September 14, 2010.

Tagish Lake has not held a shareholders meeting since March 2007, and has not as of this date filed a Notice to hold the meeting required to approve the SRP. As a result Tagish Lake is unable to call and hold the shareholders meeting by September 14th in compliance with corporate and securities laws. Assuming there is no extraordinary waiver granted by applicable regulatory bodies, the SRP is no longer capable of being approved by Tagish Lake shareholders.

New Pacific advises Tagish Lake shareholders to act expeditiously in determining whether to tender to the New Pacific Offer, or risk remaining with the unstated plans of current management of Tagish Lake.

The New Pacific Offer permits Tagish shareholders, for each Tagish share tendered to the Offer to choose between:

(a) $0.06 per share in cash (the “Cash Election”);

(b) 0.0822 of a New Pacific share (the “Share Election”); or

(c) a combination of 50% in cash and 50% in New Pacific shares (the “Combined Election”).

The Offer for the Tagish Shares represented under the Share Election represents a premium of 56% over Tagish’s closing share price on July 2, 2010, (the last trading day before the announcement of the intended offer) and a 50% premium to Tagish’s 20-day, and year to date volume-weighted average closing price (“VWAP”) on the TSX Venture Exchange (“TSXV”). Due to the rise in New Pacific’s share price from $0.76 as at July 2, 2010, to its current $1.05 per share, Tagish Lake shareholders who deposit their shares under the Share Election, will receive New Pacific shares with an effective value of $0.0863 per share – a 115.75% premium over the $0.04 per share Tagish Lake shares were trading at immediately prior to the New Pacific Offer.

The New Pacific Offer is open for acceptance until 8:00 pm (Vancouver time) on September 2, 2010 unless it is extended or withdrawn. The New Pacific Offer, and the offer to Unsecured Creditors, is subject to certain customary conditions including: a minimum tender threshold of 66 2/3% of the Tagish shares, receipt of all required regulatory approvals and third-party consents, the absence of any material adverse change in Tagish; the absence of certain prohibited activities on the part of Tagish (including share issuances, material debt issuances, acquisitions and dispositions) between the date hereof and the expiry of the Offer; and no untrue statements or omissions in Tagish’s public disclosure. Tagish shareholders and holders of Tagish Debt are urged to review the New Pacific Offer and offering circular and other documents filed by New Pacific and to tender their Shares and Debt to the New Pacific Offer.

Investors may obtain a free copy of the Circular and other documents filed by New Pacific with the Canadian securities regulators at www.sedar.com. The Circular and other documents may also be obtained for free from New Pacific’s website or by directing a request to New Pacific’s investor relations department by telephone at 1-888-224-1881, fax 604-669-9387 or e-mail info@newpacificmetals.com or by contacting the Information Agent, Kingsdale Shareholder Services Inc., toll free at 1-888-518-6812.

Secured and Unsecured Creditors of Tagish Lake may obtain more information by contacting New Pacific at the above phone numbers, or by email to: debtinfo@newpacificmetals.com

About New Pacific Metals Corp.

New Pacific Metals Corp. is an exploration stage company engaged in the acquisition and exploration of mineral properties. The Company is actively seeking out acquisition projects in China and other jurisdictions, while exploring for gold-poly-metallic projects in China.

For Further Information:
New Pacific Metals Corp.
Investor Relations
Phone: +1 (604) 633-1368
Fax: +1 (604) 669-9387
Email: info@newpacificmetals.com
Website: www.newpacificmetals.com

Forward Looking Information

This news release may contain forward looking statements, being statements which are not historical facts, including, without limitation, statements regarding the proposed acquisition of Tagish Lake common shares by New Pacific, the offer to pay out the secured and unsecured creditors ,and discussion of future plans and objectives. There can be no assurance that such statements will prove accurate. Such statements are necessarily based on a number of estimates and assumptions that are subject to numerous risks and uncertainties that could cause actual results and future events to differ materially from those anticipated or projected. New Pacific Metals disclaims any intention or obligations to revise or update such statements. The following factors, among others, could cause actual results or developments to differ materially from the results or developments expressed or implied by forward looking statements: New Pacific cannot determine the number of Tagish Lake shareholders who may accept New Pacific’s Offer; New Pacific may not succeed in acquiring 66 2/3% of the outstanding Tagish Lake shares (on a fully -diluted basis); If the Offer is successful, New Pacific may not be successful in assisting Tagish Lake to obtain, and Tagish Lake may not obtain, the regulatory and other approvals and financing required to develop the Skukum mineral district; Tagish Lake may not be successful in developing the Skukum mineral district.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the release.