Xali Gold Corp. announced that Kappes, Cassiday & Associates ("KCA") has advised they have teamed up with Starcore International Mines Ltd. ("Starcore") to put into production environmental rehabilitation project to clean up mine tailings from Mexican Mine Tailings Reprocessing Project ("Tailings Reprocessing") at El Oro in Mexico (the "El Oro Tailings Project"). Starcore and KCA have entered into a joint venture, with KCA contributing its expertise and services for the project aimed at rehabilitating the environment, while Starcore assumes the role of Operator and Financier for the joint venture.

Recent test work by KCA on the El Oro Tailings Project indicates excellent potential for 72% recovery of gold and 80% recovery of silver using a process being introduced to Xali Gold by KCA. This process would allow the gold and silver to be produced in the form of Dore, which enhances the value of the royalty stream agreed to with Xali Gold. Overall recoveries will need further testing to establish a better estimate for overall recoveries of gold and silver, but KCA is very optimistic about the process.

KCA will oversee all metallurgical and engineering studies and designs, for the tailings Reprocessing Project, and recovery of the precious metal from the Project. Starcore will cover the Capital Costs for plant construction and take on the role of Operator.