VANCOUVER, Dec. 18 /CNW/ - North American Gem Inc. (TSX-V symbol: NAG) (the "Company") announces, as a result of a review by the British Columbia Securities Commission, we are issuing the following news release to clarify our disclosure.

Pursuant to the Company's September 10, 2008 press release, the Company wishes to clarify details regarding its acquisition of Appalachia Coal Corporation ("Appalachia"). At the time of the acquisition of Appalachia there were significant portions of the properties (the "West Virginia Properties") on which insufficient drilling had been conducted to derive resource or reserve calculations. Therefore, the Company advises that information in the September 10, 2008 news release related to the estimated size of a potential coal deposit (included as an estimated number of tons of coal), on the West Virginia Properties is fully retracted and should not be relied upon. The Company did not have information prepared by a Qualified Person to support any resource estimate disclosed by the Company. The Company clarifies that it has not established any National Instrument 43-101-compliant resource or reserve estimates on the West Virginia Properties.

The Company's disclosure of a coal resource estimate on September 10, 2008 triggered the requirement to file a supporting independent technical report. The Company did not file a supporting independent report and has not yet obtained an independent technical report on the West Virginia Properties.

The Company needs to complete more verification and validation work on Appalachia's historical information on the West Virginia Properties. The Company is planning a drill program aimed at providing a National Instrument 43-101-compliant report on the West Virginia coal holdings. Because of upcoming winter conditions in West Virginia, the Company will need to determine if access can be obtained to conduct sufficient drill work. The Company estimates that it may be able to obtain a prospecting permit and conduct a drill program on a predetermined area of its property by March 2009. The drill program is expected to be comprised of several drill holes on three tracts of land within the Bakerstown, Pittsburgh and Elk Lick seams.

Following the prospecting permits and after exploratory drilling to provide further information, the Company will evaluate its options. Assuming favorable results from the exploratory drilling, the Company expects that it could move into production with an initial strip mining operation sometime in 2009, though this timeline will be impacted by the permitting process, weather conditions and delays, obtaining an independent technical report showing a mine plan, the price of coal and financial constraints.