January 26, 2017

NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. NEWSWIRE SERVICES

Vancouver, BC –  Comstock Metals Ltd. (TSX-V: CSL) (“Comstock” or the “Company”) is pleased to announce that it is undertaking a non-brokered private placement for an aggregate of up to $2,000,000 comprising $1,500,000 of units (“Units”) and up to $500,000 of flow-through units (“FT Units”).

Each Unit will be priced at $0.15 and will consist of one common share in the capital of the Company (a “Share”) and one common share purchase warrant (a “Warrant”). Each Warrant will entitle the holder thereof to purchase one additional common share of the Company (a ” Share”) at an exercise price of $0.20 per Share for a period of 24 months from the Closing Date.  Each FT Unit will be priced at $0.18 and consist of one flow-through common share in the capital of the Company (a “FT Share”) and one-half of one non-transferable common share purchase warrant (each whole warrant a “FT Warrant”). Each FT Warrant will entitle the holder thereof to purchase one additional non flow-through common share of the Company (a ” Share”) at an exercise price of $0.20 per Share for a period of 24 months from the Closing Date.

The Warrants and FT Warrants will include an acceleration clause, whereby, if the weighted average trading price of the Company’s common shares on the TSX Venture Exchange (or such other exchange on which the common shares may trade) is at a price equal to or greater than $0.40 for a period of 20 consecutive trading days, the Company will have the right to accelerate the expiry date of the Warrants and FT Warrants.   If the Company exercises such right, it will give written notice to the holders of the Warrants and FT Warrants that such warrants will expire 30 days from the date of notice to the warrant holders.  Such notice by the Company to the holders of the Warrants and FT Warrants may not be given until 4 months and one day after the Closing Date.

The Company will have the option to increase the size of each offering by up to 25% which, if fully exercised, would bring the aggregate gross amount raised under the offerings to $2,500,000.

It is anticipated that the closing of the offerings will occur mid to late February 2017.

The Company will use the gross proceeds of the offering of FT Units for eligible exploration expenditures, which will constitute “Canadian Exploration Expenses” (“CEE”) that are “Flow-Through mining expenditures”, as defined in the Income Tax Act (Canada) which can be renounced to purchasers of the FT Units for the 2017 taxation year in the aggregate amount of not less than the total amount of the gross proceeds raised from the flow-through offering.  The CEE shall be incurred no later than December 31, 2018.  The proceeds from the offering of Units will be used to fund exploration on the Company’s mineral properties and for general working capital.

The offerings are being offered on a non-brokered private placement basis in the Provinces of Alberta, British Columbia, Ontario and such other jurisdictions as the Company may determine in its sole discretion and will be subject to a statutory hold period of four months and a day from the Closing Date of the offerings. The Company may pay finder’s fees in accordance with the rules and policies of the TSX Venture Exchange. The offerings remains subject to the approval of the TSX Venture Exchange. The securities to be issued under the offerings have not been, and will not be, registered under the U.S. Securities Act or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws.

Pursuant to the proposed offering, the Company may issue securities to purchasers that are considered “related parties” (within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”)), making the applicable offering a “related party transaction” (within the meaning of MI 61-101) (the “Related Party Subscriptions”). If such sales are completed the Company will be exempt from obtaining a formal valuation for, and minority approval of, the Related Party Subscriptions pursuant to Section 5.5(b) and 5.7(a) of MI 61-101, respectively.

About Comstock Metals Ltd.
Comstock Metals Ltd. is a Canadian-focussed mineral exploration company with two 100% owned resource-stage gold projects.

• QV Property Gold Project, Yukon: Its +16,335 hectare QV Property is located in the White Gold district of the Yukon Territory, approximately 70 kilometres south of Dawson City and 44 kilometres northeast of the Coffee project of Goldcorp Inc., which it acquired through an acquisition of Kaminak Gold Corporation. To date, the Company has completed 3,400 metres of core drilling in 17 drill holes which formed the basis for a maiden Inferred mineral resource totalling 4.4 million tonnes grading 1.65 g/t gold containing 230,000 ounces of gold at a 0.5 g/t gold cut-off (See Comstock’s news release dated July 8, 2014). The VG deposit remains open to expansion and is proximal to other untested sub-parallel structures. The VG zone has similar geology and style of mineralization to Kinross’s Golden Saddle deposit, located 11 kilometres to the south.  Additional promising targets exist on the QV Project, with potential for the discovery of significant intrusion related and/or orogenic gold mineralization. The infrastructure associated with the development of the Coffee project, including upgrading and completion of the mine access road, will benefit all projects in the district, including the QV Property.

• Preview SW Gold Project, Saskatchewan: The Company’s road accessible Preview SW gold project is located 40 km north of La Ronge, Saskatchewan and 80 km southwest of Silver Standard Resources Inc.’s Seabee gold mine.  The main Preview SW deposit hosts a NI 43-101 Resource Estimate (see Comstock’s news release dated September 14, 2016) which includes Indicated resources containing 158,300 ounces of gold (2.61 million tonnes grading 1.89 g/t Au) and Inferred resources containing 270,800 ounces of gold (5.70 million tonnes grading 1.48 g/t Au), both based on a 0.50 g/t Au cut-off grade. The main Preview SW deposit is comprised of several sub-parallel northeast-trending gold-bearing quartz-sulphide mineralized structural zones, 500 m in strike length and totalling 150 m in width.  Preliminary metallurgical test work indicates total gold recovery in concentrates ranged from 90% to 93%. In addition, there are six additional known gold zones on the 853 ha property with only limited drilling. At the Preview North zone, located 2.6 km northeast of the Preview SW deposit, drill hole PR13-163 intersected: 17.98 g/t Au over 5.71 m starting at 10 m below surface, 5.96 g/t Au over 5.66 m starting at 19 m below surface and, 1.88 g/t Au over 21.26 m starting at 29 m below surface.  There has been insufficient drilling at the Preview North zone to determine the attitude of the reported mineralized intervals and, therefore, the above mineralized intersections may not represent true widths.  No drilling has been carried out for over 600 m to the south of this hole.

Additional Assets: Comstock also owns the early stage Old Cabin gold project in Ontario and uranium claims in the Patterson Lake area of Saskatchewan and has optioned out its Corona property in Mexico (see Comstock’s news release dated January 28, 2016).

David A. Terry, Ph.D., P.Geo., a Qualified Person as defined by National Instrument 43-101, has reviewed and approved the scientific and technical disclosure in this news release.

Forward Looking Statements

This news release includes forward-looking information and statements, which may include, but are not limited to, information and statements regarding or inferring the future business, operations, financial performance, prospects, and other plans, intentions, expectations, estimates, and beliefs of the Company. Such statements include statements regarding the anticipated closing of the proposed financing and the use of proceeds resulting therefrom. Forward-looking information and statements involve and are subject to assumptions and known and unknown risks, uncertainties, and other factors which may cause actual events, results, performance, or achievements of the Company to be materially different from future events, results, performance, and achievements expressed or implied by forward-looking information and statements herein. The assumptions on which the forward looking statements contained herein rely include the ability to complete the proposed financing. Although the Company believes that any forward-looking information and statements herein are reasonable, in light of the use of assumptions and the significant risks and uncertainties inherent in such information and statements, there can be no assurance that any such forward-looking information and statements will prove to be accurate, and accordingly readers are advised to rely on their own evaluation of such risks and uncertainties and should not place undue reliance upon such forward-looking information and statements. Any forward-looking information and statements herein are made as of the date hereof, and except as required by applicable laws, the Company assumes no obligation and disclaims any intention to update or revise any forward-looking information and statements herein or to update the reasons that actual events or results could or do differ from those projected in any forward looking information and statements herein, whether as a result of new information, future events or results, or otherwise, except as required by applicable laws.

For more information about Comstock Metals Ltd., please go to www.comstock-metals.com or contact:

David A Terry, Ph.D., P.Geo.
President, CEO and Director
COMSTOCK METALS LTD.
Phone:  (604) 639-4533
Email: info@comstock-metals.com

Neither 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.