Pinecrest Resources Enters into Option Agreement to Acquire Espiritu Copper-Gold-Silver Project from Kootenay Gold

PINECREST RESOURCES LTD.

Suite 1820, 999 West Hastings Street Vancouver, British Columbia V6C 2W2

PINECREST RESOURCES ENTERS INTO OPTION AGREEMENT TO ACQUIRE ESPIRITU COPPER-GOLD-SILVER PROJECT FROM KOOTENAY GOLD

Vancouver, British Columbia, February 28, 2011. Pinecrest Resources Ltd. (“Pinecrest” or the "Company"), a capital pool company, is pleased to announce that it has entered into an option agreement (the “Option Agreement”) dated February 28, 2011 with Kootenay Gold Inc. (“Kootenay”), a Tier 1 TSX Venture Exchange (the “Exchange”) listed issuer continued under Business Corporations Act (British Columbia), pursuant to which Kootenay has granted to Pinecrest an option to acquire up to an undivided 50% interest in the two mineral concessions comprising the Espiritu property (the “Property”) located in Sahuaripa, Sonora Mexico.

Pinecrest is a “capital pool company” under the rules and policies of the Exchange. The transaction contemplated by the Option Agreement will represent Pinecrest’s qualifying transaction (the “QT”) and is subject to the acceptance of the Exchange. The QT is not a related party transaction under the rules and policies of the Exchange and the QT does not constitute a non-arm’s length QT. Approval of the shareholders of Pinecrest to the QT will not be required by the Exchange. Upon completion of the QT, Pinecrest will become a Tier 2 mining issuer on the Exchange. Pinecrest will apply to the Exchange for a waiver of the requirement to engage a sponsor with respect to the QT. There is no assurance that a waiver will be granted.

Pursuant to the terms of the Option Agreement, to earn a 50% in the Espiritu Property Pinecrest must spend $1.0 million on exploration expenditures over a period of four years ($200,000 in first year) and issue up to 750,000 common shares over a three year period, of which 200,000 common shares of Pinecrest will be issued to Kootenay on the fifth business day following the receipt of the Exchange’s final bulletin providing acceptance to the QT. Pinecrest will be the operator of the project during the term of the Option. Upon exercise of the Option, a joint venture between Pinecrest and Kootenay will be formed to further explore and, if deemed warranted to develop the Property and equip all or a part thereof for commercial production, and to operate the Property or any portion thereof as a mine. Pinecrest and Kootenay will in good faith negotiate and settle the terms of a joint venture agreement within a period of 30 days of the exercise of the Option. Funding of further work on the Property will be on a proportional basis in proportion to ownership percentage. Either party may be diluted on the basis of a standard formula if they do not contribute to the planned program.

Financing

There are currently 7,400,000 common shares of Pinecrest issued and outstanding. In conjunction with the QT, Pinecrest also announces a non-brokered private placement to raise gross proceeds of $550,000 by the issuance of 2,500,000 units (the “Units”) at a purchase price of $0.22 per Unit. Each Unit will consist of one common share and one non-transferable common share purchase warrant (a “Warrant”). Each Warrant will entitle the holder to acquire an additional common share of Pinecrest at an exercise price of $0.30 per common share exercisable at any time until three years from the date of the closing of the QT. The proceeds of the private placement together with Pinecrest’s current working capital will be

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used to fund the first year’s work program on the Property and for general working capital purposes. Insiders of the Company will be participating in the private placement financing

Upon completion of the QT, including completion of the private placement, Pinecrest will have 9,900,000 common shares issued and outstanding. Assuming that the Option is exercised in full whereby Pinecrest acquires a 50% interest in the Property, Kootenay will hold an aggregate of 750,000 common shares of Pinecrest representing approximately 7.6% of the Company's issued and outstanding shares on a nondiluted basis.

Directors, Officers and Insiders of Pinecrest Following the QT

It is anticipated that upon completion of the QT, the directors, officers and insiders of Pinecrest will be the following:

Edward Farrauto, CGA, Director and Chief Executive Officer

Mr. Farrauto has 18 years of experience as a senior financial officer in working for private and public companies. His experience encompasses financial and regulatory compliance and public company management. Mr. Farrauto is a Certified General Accountant and has been a member of the Certified General Accountants Association since 1991. Mr. Farrauto is a director of Calibre Mining Corp. and was a director of Terrane Metals Corp. a company recently taken over by Thomson Creek Metals Company Inc. Mr. Farrauto has been the President of Sail View Capital Ltd. from February 1994 to present.

Kristian Dagsaan, CA, Chief Financial Officer

Mr. Dagsaan, is a Canadian Chartered Accountant (2007) with several years of experience in the resource sector. He articled with PricewaterhouseCoopers LLP (2005 to 2008) and holds a Bachelor of Arts (Honors) degree from Vancouver Island University (2004). Mr. Dagsaan is currently the Controller of Edgewater Exploration Ltd., a Canadian-based mine development company with gold assets in Spain and Ghana. Mr. Dagsaan previously served as a Controller of an oil and gas exploration and production company with domestic and international operations.

Ryan King, Director and Corporate Secretary

Mr. King is currently Vice President and Director of Edgewater Exploration Ltd., a Canadian-based, TSX Venture Exchange listed mine development company with gold assets in Spain and Ghana. From September, 2007 to January, 2010 Mr. King was Information and Investor Relations Manager for Terrane Metals Corp., a company recently acquired by Thomson Creek Metals Company Inc. Mr. King is a Microsoft Certified Systems Engineer and has numerous years experience as an information technology specialist with both public and private companies in the oil and gas, banking and legal sectors.

Douglas Forster, M.Sc., P.Geo., Director

Mr. Forster has been associated with the mineral exploration and mine development industry for the past 30 years. He holds a B.Sc. (1981) in Geology and a M.Sc. (1984) in Economic Geology from the University of British Columbia, Canada and is a registered member of the Association of Professional Engineers and Geologists of British Columbia. Mr. Forster has extensive experience in resource project development, mergers and acquisitions, equity financings and public company management. He has been a founder, senior executive and/or director of numerous publicly traded companies listed on North American Stock Exchanges and is currently a director of Calibre Mining Corp.

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Kimberly Williams, B.A.Sc. Director

Ms. Williams has over 18 years of experience in the financial and legal services industry, specifically in the resource mining sector and holds a B.A.Sc. in Marketing and Management. She has been a director of Edgewater Exploration Ltd. since June 2007, Corporate Communications Advisor of BCGold Corp. since February 2009 and Executive Consultant of Terrane Metals Corp., a company recently taken over by Thomson Creek Metals Company Inc., from June 2006 to October 2010. She also holds the position of Corporate Secretary for RedQuest Capital Corp. Ms. Williams previously held the position of Assistant Vice President at Endeavour Financial Ltd. (“Endeavour”), a financial advisory firm focused on the mineral resource industry. Her responsibilities at Endeavour involved assisting clients with the implementation and closing of corporate transactions, the coordination and management of equity financings, as well as managing public company administration and regulatory compliance. Prior to joining Endeavour, Ms. Williams held Corporate Communications positions with various junior public companies in the resource mining sector.

Blayne Johnson, Insider

Mr. Johnson has been involved in the investment community for the past 20 years. Since 1996, he has managed his own investment and real estate portfolios and has been an active investor in the mining and energy sectors. He is currently Chairman of Featherstone Capital Advisors Inc., a director of Calibre Mining Corp, and Edgewater Exploration Ltd.

Espiritu Copper-Gold-Silver Property

The Espiritu polymetallic vein/breccia porphyry Property is made up of two mineral concessions called Tarachi 2 and Tarachi 3 which total approximately 10,000 hectares, located in Sahuaripa, Sonora Mexico. Minera J.M., S.A. de C.V., a wholly owned subsidiary of Kootenay incorporated under the laws of Mexico, is the sole legal and beneficial owner of the Espiritu Property.

On the Espiritu Property two zones of precious and base metal mineralization have been recognized; the Northeast zone dominated by a copper-gold-molybdenum porphyry setting is separated by a major fault from the Southwest zone dominated by veins and stockworks of precious and base metal mineralization

Northeast Zone

The northeast Espiritu porphyry prospect is a 2.2 x 1.4 km sub-circular area defined by a concentric pattern of zonation diagnostic of copper gold porphyry deposits.

Ten wide-spaced diamond drill holes totalling 2,135 meters of HQ core were completed by Kootenay Gold in the Northeast Zone in 2009-2010. Highlights include: 220.5 meters grading 0.15% copper and 0.14 gpt gold in diamond drill hole ESP 06-10, including 12 meters grading 0.25% copper and 0.42 gpt gold. In addition, significant molybdenum grades were encountered by Kootenay Gold in drill hole ESP 04-09 which intersected 18 meters grading 0.113% Mo and 9 meters grading 0.133% Mo and in ESP 06- 10 returning 18 meters of 0.114% Mo and 9 meters of 0.133% Mo.

Additional drilling will be required to follow-up on the significant molybdenum intercepts discovered in the initial drill program as well as to test for higher grades of porphyry related copper and gold mineralization.

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Southwest Zone

The southwestern part of the system is represented by veins, breccias and stockworks anomalous in silver, gold, copper, lead and zinc. The main mineralization in the southwest is defined by several zones spread along a 2 km length. Fifty-eight grab samples were collected by Kootenay Gold in 2009-2010 within the west, central and eastern parts of the southwest polymetallic vein/breccia zone. The polymetallic veins averaged 226 gpt silver, 1.58% lead and 1.57% zinc associated with 0.18 gpt gold and 0.15% copper. From the 35 samples collected by Kootenay Gold in 2009-2010 from the polymetallic vein system, 29/35 assayed greater than 30 gpt silver and 18/35 were greater than 0.100 gpt gold. The PS-1 area returned assays of 277 and 217 gpt silver associated with anomalous lead (to 6%) and zinc (to 1.5%). The PS-2 zone gave values of 686, 644 and 487 gpt silver and anomalous copper, lead and zinc from thirteen rock samples.

The Southwest zone of the Property has never been drilled.

Options

Concurrent with the completion of the QT, Pinecrest intends to grant incentive stock options to directors and officers of the Company that will entitle the holders to purchase up to 190,000 common shares in the capital of the Company. The exercise price of the stock options will be $0.30 per common share and the options will have a term of five years from the completion of the QT. The grant of the stock options is subject to regulatory and Exchange acceptance.

Significant Conditions to Closing

Completion of the QT is subject to certain conditions including, without limitation, approval of the QT by the Exchange, waiver of the requirement to engage a sponsor or the engagement of a sponsor, and completion by Pinecrest of an equity financing of $550,000. There can be no assurance that the QT will be completed as proposed or at all.

Trading Halt

In accordance with Exchange policy, the shares of Pinecrest will remain halted from trading on the Exchange until such time as the Exchange reinstates the shares for trading, which, depending on the policies of the Exchange, may not occur until the completion of the QT.

The technical disclosure in this release has been reviewed and verified by Mr. James McDonald, P. Geo., a Qualified Person as defined in terms of National Instrument 43-101 – Standards of Disclosure for Mineral Projects. Mr. McDonald is a director of Kootenay Gold Inc. and has no relationship or direct or indirect personal interest in Pinecrest.

Completion of the QT is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement or other disclosure documents of Pinecrest to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Pinecrest should be considered highly speculative.

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The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

ON BEHALF OF THE BOARD

“Edward Farrauto”

Edward Farrauto, Chief Executive Officer

For further information, please contact Edward Farrauto, Chief Executive Officer

Telephone: 604-687-3992, Fax: 604-628-1011 or email: [email protected]

Address: Suite 1820-999 West Hastings Street, Vancouver, British Columbia V6C 2W2

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.