Pele Mountain Resources Inc.

Pele Mountain Resources Inc.

January 31, 2007 10:14 ET

Pele Mountain Adopts Shareholder Rights Plan

TORONTO, ONTARIO--(CCNMatthews - Jan. 31, 2007) - Pele Mountain Resources Inc. (TSX VENTURE:GEM) ("Pele" or the "Company") today announced its Board of Directors has approved the adoption of a shareholder rights plan (the "Rights Plan") to be effective as of January 31, 2007. The Rights Plan is designed to encourage the fair and equal treatment of shareholders in connection with any take-over bid for the outstanding securities of the Company.

In approving the Rights Plan the Company intends to provide shareholders and the Board of Directors with adequate time to assess any take-over bid; to consider alternatives to a take-over bid as a means of maximizing shareholder value; to allow competing bids to emerge; and to provide shareholders with adequate time to properly assess a take-over bid without undue pressure. Pele's Board of Directors is not currently aware of any pending or threatened take-over bid for the Company. The Rights Plan is similar to plans adopted by other Canadian companies and ratified by their shareholders.

Under the terms of the Rights Plan, one right (a "Right") will be issued by Pele in respect of each outstanding Pele common share at the close of business on February 7, 2007 and in respect of each Pele common share issued thereafter (subject to the terms of the Rights Plan). The Rights issued under the Rights Plan become exercisable only if a person acquires or announces its intention to acquire 20 percent or more of the common shares of the Company without complying with the "permitted bid" provisions of the Rights Plan or without approval of Pele's Board of Directors.

Should such an acquisition occur, Rights holders (other than the acquiring person or related persons) can purchase common shares of the Company at a substantial discount to the prevailing market price (as defined in the Rights Plan) at the time the Rights become exercisable.

Although effective as of January 31, 2007, the Rights Plan is subject to ratification by the Company's shareholders at the Company's annual and special meeting of shareholders currently scheduled for March 9, 2007, and, if ratified, the Rights Plan must be confirmed at every third annual meeting thereafter. If not ratified at the Company's shareholders' meeting scheduled for March 9, 2007, the Rights Plan and all of the Rights outstanding at the time will terminate. The Rights Plan has been accepted for filing by the TSX-V subject only to shareholder approval.

A copy of the Rights Plan will be available on SEDAR at and can also be obtained from Pele upon a written request.

About Pele Mountain Resources

Pele Mountain Resources is focused on the advancement of its 100-percent owned Elliot Lake uranium project in northern Ontario. The Elliot Lake project hosts a NI 43-101 compliant mineral resource of 33 million pounds of U3O8 with very good potential to increase the mineral resources on the property, according to a Technical Report authored by Scott Wilson Roscoe Postle Associates Inc.

The Elliot Lake mining camp was once known as "the uranium capital of the world" and has produced more than 270 million pounds of U3O8 from stratigraphically-bound deposits that demonstrate remarkable consistency over extensive areas. The uranium market is currently experiencing a strong upward price trend due to uncertain supply and increasing global demand.

Pele also holds a diverse portfolio of gold, diamond, and base metal projects located across northern Ontario, including the Highland project where drilling has outlined several high-grade, narrow-vein gold zones within an historic mining camp. Through project generation and mineral discovery, Pele provides shareholders with exposure and leverage to the increasing global demand for natural resources. Pele stock trades on the TSX Venture Exchange under the symbol "GEM".

Some of the statements contained in this release are forward-looking statements, such as estimates and statements that describe Pele's future plans, objectives or goals, including words to the effect that Pele or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Common Shares Outstanding: 65,834,360

The TSX-V has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information