Avalon options three gold properties near the Dubenski Project, Dogpaw Lake Area, Kenora, Ontario.

TORONTO--(BUSINESS WIRE)--Jan. 13, 1997--AVALON VENTURES LTD. (VSE:AVL.) Avalon Ventures Ltd. (the "Company") is pleased to announce that it has entered into option agreements with local prospectors to earn 100 percent interests in three gold properties in the Dogpaw Lake area, 70 km southeast of Kenora, Ontario.

These acquisitions follow recent compilation work by the Company which identified several other excellent gold targets along trend from the recently optioned Dubenski gold project. This brings the Company's total land holdings in the Dogpaw Lake area to approximately 5,500 acres.

The three agreements involve cash payments and/or share issuances (subject to regulatory approval) and exploration expenditures over a four-year period totaling as follows: -0-

                                                 Exploration
Property          Cash            Shares         Expenditures

Flint Lake       $84,000            --            $150,000
Cedartree Lake   $55,000          100,000         $300,000
Caviar Lake      $60,000          100,000         $250,000

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The initial obligations total $28,000 cash, 50,000 shares and $100,000 in exploration expenditures in the first year. All three properties are subject to 2.5 percent net smelter return royalty ("NSR") interests retained by the vendors which can be each bought down to a 1 percent NSR for $1.5 million cash.

The three properties form a contiguous group situated east of, and along strike from, the Dubenski property covering projected extensions of the Flint Lake Shear, and its junction with two other regional gold-bearing structures; the Cameron-Pipestone Fault and the Wabigoon Fault system. Recent sampling on the Flint Lake property by the vendor has yielded assay values of up to 1.934, 1.912 and 0.637 oz/ton gold in grab samples of quartz-carbonate veins in chlorite-sericite schists of the Cameron-Pipestone Fault.

The Company plans to begin work programs on the three new properties this summer. In the meantime work continues on the Dubenski property in preparation for a 3,000 foot first-phase drilling program which is scheduled to begin within the next three weeks.

In the Matawin Gold Belt, drilling has resumed on the Stewart gold property, following the Christmas break and the first hole is now roughly halfway to its target depth of 750m. The Christmas break has also slowed the turnaround on assays from the Denain project, but all remaining results are expected by the end of the week.

Further to the Company's news release of December 2, 1996 regarding the Dubenski property, it was agreed to pay a finder's fee to Mr. Ken Fenwick and Mr. James Bond II, for bringing this opportunity to the Company's attention. The Company will pay the finders up to a maximum of 100,000 shares, in stages, provided that the option to purchase the property is exercised. The first block of 10,000 shares will be issued on regulatory approval. Further 10,000 share issuances will be made on each anniversary of the agreement, so long as the option remains in good standing.

In other corporate developments, the Company announces that it has granted incentive stock options to a new employee, entitling this individual to acquire up to 30,000 common shares of the Company at an exercise price of $0.85 per share, for five years until January 13, 2002, subject to acceptance for filing by the Vancouver Stock Exchange.

The Company also announces that it has terminated its Investor Relations agreement with Triumph Street Capital Corp. and entered into a new agreement with Blackwell Investor Relations, effective December 2, 1996. Blackwell, a private Ontario company based in Toronto, the principals of which are Michael Carpe and Richard Williams, Assistant Secretary of the Company (who holds options in the Company, previously disclosed), will be responsible for the dissemination of corporate information to shareholders and prospective investors, with a particular emphasis in increasing awareness of the Company among investors in southern Ontario. For providing these services, Blackwell will receive a monthly fee of $2,000 plus reimbursement of reasonable out-of-pocket expenses. The agreement is subject to the approval of the Vancouver Stock Exchange. The Company continues to maintain an Internet website as a convenient source of corporate information at: http://www.avalonventures.com

For further information, please contact Donald S. Bubar, President at [phone] or Investor Relations TOLL FREE at 1-888-338-1188. -0-

NOTE TO EDITORS: No stock exchange has either approved or disapproved the information contained herein.

CONTACT: Avalon Ventures Ltd., Toronto

Donald S. Bubar, 416/364-4938

Investor Relations, 1-888/338-1188 (Toll Free)