Sutter Gold Mining Inc.
TSX VENTURE : SGM

Sutter Gold Mining Inc.

November 29, 2007 17:04 ET

Sutter Drilling Update and Review of Strategic Alternatives

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 29, 2007) - Sutter Gold Mining Inc. (TSX VENTURE:SGM) today announced that it has postponed the Phase II 2,100 meter (7,000 ft) surface exploration drilling program in the Keystone Mine area at the Sutter Gold Project in northern California to devote more financial resources and management time to the exploration of strategic alternatives for maximizing shareholder value. Assay results for Keystone hole KDH-29 have been received (see Table 1), and Phase I surface core drilling should be commencing next week at the Sutter Gold/Premier Gold Mines joint venture El Alamo, Mexico project.

Sutter announced on September 5, 2007 that it has retained IBK Capital Corp. of Toronto to evaluate a number of available options, including, but not limited to the sale of the Company or the merger of the Company with a strategic partner. Hal Herron, president and CEO, said, "We are currently evaluating a number of alternatives brought to us by our advisors and have decided to utilize the Behre Dolbear pre-feasibility draft work product as an important tool for strategy planning. Accordingly, this product, being in draft form only, will not be published on Sedar.com. Our management and board together believe that the pursuit of these opportunities is the highest and best use of our resources at this time considering the strength in gold prices."

Phase II Surface Drilling Results

The first hole of the 2007 Phase II surface drilling, KDH-29, has continued to extend the shoots in the Keystone 5 Vein and 13 Vein southward from the areas tested in 2006 program. Hole KDH-29 encountered 1 meter grading 6.5 g/tonne gold (3.2 ft @ 0.19 oz/ton) from 297.1 to 298.1 meters (974.5-977.7 ft) in the Keystone 5 Vein along the western contact of the Lincoln meta-volcanic block. A 2.7 meter interval grading 3.8 g/t (9.0 ft @ 0.11 oz/t) was intersected in the Keystone 13 Vein from 125.3 to 128.0 meters (411.0-420.0 ft) along the eastern contact of the Lincoln meta-volcanic block, including 1 meter grading 5.1 g/t (3.2 ft @ 0.15 oz/t) from 127.0 to 128.0 meters (416.7-420.0 ft).



Table 1
Drill Hole Assays - Sutter Gold Project

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Visible
Width AU Width Au AU
(i) (g/ (i) (oz/ in
Hole# Interval (m) (m) tonne) Interval (ft) (ft) ton) Vein Core
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KDH-29, coords 39507 east, 74680 north, Azimuth 200 deg, Dip - 70 deg,
Depth 338 m (1,109)
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63.9 to 65.74 1.8 1.4 209.5 to 215.5 6.0 0.04 Au
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95.7 to 96.9 1.2 1.7 314.0 to 318.0 4.0 0.05
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114.0 to 133.5 19.5 1.4 374 to 438.1 64.1 0.04
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including
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114.0 to 117.0 3.0 1.0 374.0 to 384.0 10.0 0.03
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and 118.1 to 120.1 2.0 1.4 387.3 to 393.9 6.6 0.04
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and 122.5 to 125.7 3.2 2.7 402.0 to 412.5 10.5 0.08 K13 HW qtz
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and 127.0 to 128.0 1.0 5.1 416.7 to 420.0 3.2 0.15 K13 FW qtz
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141.7 to 142.7 1.0 1.7 464.8 to 468.0 3.2 0.05
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297.1 to 299.0 1.9 3.8 974.5 to 980.7 6.2 0.11 K5
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including
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297.1 to 298.1 1.0 6.5 974.5 to 977.7 3.2 0.19 K5
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302.5 to 303.5 1.0 1.4 992.3 to 995.6 3.2 0.04
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The K5 Vein intercept in hole KDH-29 included 0.2 meters (0.8 ft) of graphitic fault gouge containing rotated lenses and fragments of ribboned vein quartz at the hanging wall, followed by 0.9 meters (3.0 ft) of highly disrupted quartz stringer veined slate interrupted by sub-parallel graphitic gouge seams. A 0.1 meter (0.3 ft) band of highly deformed phyllonite derived from slate with thin quartz veinlets defined the footwall of the K5 Vein structure, with a 0.8 meter (2.5 ft) lens of sulfidized meta-graywacke intervening.

The K5 Vein intercept in hole KDH-29 was visually consistent with historic descriptions from the Keystone mine where the wide gold-quartz veins locally steepened up dip and were locally faulted out against the hanging wall by post-mineral fault movement, smearing dismembered lenses of gold-bearing quartz up dip along a prominent zone of fault gouge. This fault gouge type of mineralization was generally narrower but could still be of minable grade. The large historic quartz stopes developed along the relatively shallower dipping segments of the structure, and their updip terminations were described in this manner. The character of the K5 Vein intercept in KDH-29 suggests that a thick shoot of vein quartz should be present in fairly close proximity down dip from this location. The Phase I and II surface drilling has identified a resource in the Keystone 5 Vein which is comprised of relatively thick gold-quartz lenses linked together by a continuous zone of high-strain auriferous phyllonite and fault gouge.

Hole KDH-30 has been completed to a depth of 378 meters (1,241 ft) where a caved stope in the K5 Vein was encountered from 365.5 to 378.3 meters (1,199.0 to 1,241.0 ft). The drill penetrated 10.4 meters (34 ft) of graphitic rubble followed by a 1.5 meter thick slab, then additional graphitic rubble. The rods became jammed before the footwall of the stope was reached. From 354.3 to 365.5 meters (1,162 to 1,199 ft), sulfide replacement type mineralization of varying strength was encountered in the altered meta-basalt hanging wall of the K5 Vein. A strong looking zone of complex quartz veining was encountered in the Keystone 13 Vein from 157.0 to 163.0 meters (515 to 535 ft). Assay results from hole KDH-30 will be announced when received.

The Sutter Gold Phase II core drilling program is planned and supervised by Mr. Mark Payne, P. Geo. Calif. 7067, the Qualified Person for the Sutter Gold Project, as defined by NI 43-101, and has reviewed this release.

Update - El Alamo, Mexico Phase I Surface Drilling Program

A proposed 4,200 meter (14,000 ft) surface core drilling program will be commencing next week at the Sutter Gold/Premier Gold Mines joint venture exploration project at the Santa Teresa Concession in the El Alamo Mining District, Baja California Norte, Mexico. Major Drilling Inc. of Hermosillo, Mexico has been contracted for the drilling of twenty-six proposed HQ-size core holes to test at least nine gold-quartz vein structures with past production of very high-grade gold ore from near-surface workings above the water table. The Phase I drill program marks the first modern exploration program to test the extensive high-grade vein system at the Santa Teresa Concession at depth.

About Sutter Gold Mine

The Sutter Gold project contains a 3.2 mile segment of the Mother Lode belt from which 10 historic mines produced 2.3 million ounces of gold. The historic mines bracket a one-mile-long portion of the Mother Lode belt with no historic gold production and which contains the Lincoln and Comet zones. The Lincoln and Comet zones were blind discoveries that did not outcrop at surface and which represent the first significant new gold discoveries made along the Mother Lode belt in the last 50 years. The Sutter Gold project has been the subject of considerable modern exploration activity, most of it centering on the Lincoln and Comet zones, which are adjacent to each other and together referred to as the Lincoln project. A total of 101,385 feet of drilling has been accomplished in 230 diamond drill holes, and modern underground development consists of a 2,850-foot declined ramp with 2,400 feet of crosscuts plus five raises. The historic gold production was documented in a detailed report completed by Mark Payne, the consulting geologist to Sutter Gold and a qualified person as defined by National Instrument 43-101. Further information is available on the Company's Lincoln Project and El Alamo, Mexico gold concession at www.suttergoldmining.com.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.

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