Palmarejo Silver and Gold Corporation
TSX VENTURE : PJO

Palmarejo Silver and Gold Corporation

May 31, 2006 09:20 ET

Palmarejo Project Environmental Permit Approved

LONGUEUIL, QUEBEC--(CCNMatthews - May 31, 2006) -

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Palmarejo Silver and Gold Corporation (TSX VENTURE:PJO) is pleased to announce that the environmental permit for the Palmarejo Project has been approved by SEMARNAT (the Mexican Government environmental authority, Secretariat of Environmental and Natural Resources).

This permit is a significant step forward in the Company's objective to build and operate a major silver and gold mine at Palmarejo in the Mexican Sierra Madre, Chihuahua State, and enables the Company to commence earthworks for plant construction, facilitates the commencement of infrastructure (access road) upgrade and mobilize process plant and equipment for mine development as currently planned. The permit approves mining activities for a 10 year period, plus 3 years for reclamation, based on the Palmarejo Project mine plan as submitted by the Company to SEMARNAT.

Forward looking statement

Some of the statements contained in this press release are forward-looking statements. Forward-looking statements are not historical facts, and are subject to a number of risks and uncertainties beyond the Company's control, including statements regarding resources and reserves, completion of work program and studies, and future plans and objectives of the Company. Resource exploration, development, and operations are highly speculative, characterized by a number of significant risks, which even a combination of careful evaluation, experience and knowledge may not eliminate, including, among other things, unprofitable efforts resulting not only from the failure to discover mineral resources but from finding mineral deposits which, though present, are insufficient in quantity and quality to return a profit from production. There can be no assurance that such statements will prove to be accurate and actual results could differ materially from those suggested by these forward-looking statements for various reasons discussed throughout the Company's Annual Information Form dated May 25, 2006, and particularly in the section entitled "Risk Factors".

For more information about the Company's projects, please refer to the NI 43-101 Technical Report dated May 1, 2006 available on SEDAR (www.sedar.com) or via the Company's website at (www.palmarejogold.com).

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release

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