Palmarejo Silver and Gold Corporation
TSX VENTURE : PJO

Palmarejo Silver and Gold Corporation

June 12, 2007 09:29 ET

Palmarejo Silver and Gold Corporation Announces Further Drill Results from the Guadalupe Project

LONGUEUIL, QUEBEC--(Marketwire - June 12, 2007) - Palmarejo Silver and Gold Corporation (TSX VENTURE:PJO) is pleased to announce the latest results from the continuing reverse circulation (RC) and diamond drill program at the Guadalupe project, 7 kilometres southeast of the Palmarejo Project, in the Temoris District, Chihuahua, Mexico. The project is held by the Company's 100%-owned subsidiary, Planet Gold SA de CV.

The Guadalupe project consists of a series of northeast dipping quartz veins that have been traced for more than 1,500 metres along strike. There are three main prospects located along the Guadalupe structure known from north to south as Guadalupe Norte, Guadalupe and Las Animas. A fourth prospect, El Salto, has been identified by surface mapping as a link structure between Las Animas and Guadalupe. El Salto has only been tested by near surface drilling.

Twenty-eight holes have been drilled for 2,707 metres of RC and 4,731 metres of diamond core since the previous drill result update on April 16, 2007. These drill hole results are being incorporated in the Guadalupe resource update currently in progress.

Three high grade clavos (G1, G2 and G3), defined by the 50 gram metre AuEq accumulation contour, are emerging between Guadalupe and Guadalupe Norte (see attached long section). The top of the well mineralized part of the epithermal profile occurs at 1,300 metres elevation, up to 300 metres below the surface at Guadalupe Norte. The top of the profile is only 100 metres below surface at Las Animas where the topographic surface is 100 to 200 metres lower than that at Guadalupe Norte. The clavos have been drilled to the 1,100 metre level and remain open at depth.

RC and core drilling resumed in May at the Las Animas prospect along the southern extension of the Guadalupe structure. In addition, two core rigs have continued exploring the extents of high grade mineralization encountered between Guadalupe and Guadalupe Norte. Some of the impressive assay results from these programs are reported below and include the following intervals which are reported here as down hole intercepts. Where there is a difference between down hole and true width intercepts these are noted in the table of full assay results below.



- TGDH102D 5.50 metres @ 0.48 g/t Au and 92 g/t Ag (2.0 g/t AuEq) and
11.00 metres @ 0.84 g/t Au and 65 g/t Ag (1.9 g/t AuEq) and
19.00 metres @ 0.82 g/t Au and 47 g/t Ag (1.6 g/t AuEq)
- TGDH118D 15.00 metres @ 0.80 g/t Au and 74 g/t Ag (2.0 g/t AuEq)
- TGDH119D 22.50 metres @ 1.40 g/t Au and 243 g/t Ag (5.5 g/t AuEq)
including 8.50 metres @ 2.86 g/t Au and 527 g/t Ag (11.6 g/t AuEq) and
8.00 metres @ 1.23 g/t Au and 72 g/t Ag (2.4 g/t AuEq)
- TGDH120D 9.50 metres @ 2.37 g/t Au and 174 g/t Ag (5.3 g/t AuEq) and
1.00 metre @ 2.76 g/t Au and 900 g/t Ag (17.8 g/t AuEq)
- TGDH121D 11.50 metres @ 3.18 g/t Au and 299 g/t Ag (8.2 g/t AuEq)
- TGDH122D 9.08 metres @ 2.73 g/t Au and 339 g/t Ag (8.4 g/t AuEq) and
21.00 metres @ 4.59 g/t Au and 221 g/t Ag (8.3 g/t AuEq)
- TGDH123D 7.07 metres @ 0.84 g/t Au and 115 g/t Ag (2.8 g/t AuEq)
- TGDH124D 5.00 metres @ 4.76 g/t Au and 236 g/t Ag (8.7 g/t AuEq)
including 2.00 metres @ 11.15 g/t Au and 542 g/t Ag (20.2 g/t AuEq)
- TGDH126 7.62 metres @ 2.88 g/t Au and 694 g/t Ag (14.5 g/t AuEq)
- TGDH127 10.66 metres @ 0.44 g/t Au and 91 g/t Ag (2.0 g/t AuEq)
- TGDH129 25.91 metres @ 1.91 g/t Au and 204 g/t Ag (5.3 g/t AuEq) and
15.24 metres @ 1.66 g/t Au and 173 g/t Ag (4.5 g/t AuEq)
- TGDH130 12.19 metres @ 0.95 g/t Au and 131 g/t Ag (3.1 g/t AuEq) and
10.67 metres 2.23 g/t Au and 148 g/t Ag (4.7 g/t AuEq)
- TGDH131 9.14 metres @ 0.79 g/t Au and 142 g/t Ag (3.2 g/t AuEq)


A map of the Palmarejo - Trogan Project is available on the Marketwire website at the following address : http://www.ccnmatthews.com/docs/PalmarejoMap_TroganProject.jpg

Details of the drill hole locations are available on the Marketwire website at the following address: ttp://www.ccnmatthews.com/docs/Palmarejo_DrillHoleTable.pdf

Assay results are available on the Marketwire website at the following address: http://www.ccnmatthews.com/docs/Palmarejo_AssayResultstable.pdf

Notes:

- Assays have been calculated using a 1.0 g/t AuEq cut off, no top cut and a gold to silver price ratio of 1:60.

- Metallurgical recoveries and smelter returns are assumed to be 100%.

- QVBX = quartz vein breccia.

- # = previously reported and included here for completeness.

- Bulked intercepts are calculated by weight averaging the grades between the given depths and incorporating a maximum dilution of 2 metres internal waste at less than the 1.0 g/t AuEq cut off.

- Results are awaited for drill holes TGDH128D, TGDH132D, TGDH135D to TGDH139 and TGDH141.

Twenty-two of the holes reported in this update were drilled below and/or along strike of drill holes included in the October 2006 resource model. Holes TGDH120D, TGDH121D, TGDH123D and TGDH125D infilled around the historical Guadalupe workings whereas TGDH126 and TGDH138D attempted to define the upper limits of high grade mineralization at Las Animas and the G3 clavo, respectively.

Holes TGDH119D intersected the G2 clavo at Guadalupe Norte down dip and northwest of previous holes TGDH065D (29.00 metres @ 2.96 g/t Au and 279 g/t Ag) and TGDH109D (12.00 metres @ 2.39 g/t Au and 189 g/t Ag). TGDH122D tested the G2 clavo along strike of TGDH119D and intersected 2.73 g/t Au and 339 g/t Ag over 7.9 metres (true width) in the main Guadalupe vein. A new, 18.2 metre wide (true width) footwall structure yielded 4.59 g/t Au and 221 g/t Ag deeper in the hole. Further drilling is programmed to evaluate the significance of the new structure encountered in the footwall.

Nine RC and three core holes have been drilled at Las Animas since drilling resumed at this prospect in May 2007. Most of the drilling has targeted the extension of the Las Animas clavo southeast of the wide, high grade intercept in hole TGDH035D (29.50 metres @ 2.98 g/t Au and 195 g/t Ag). Results for holes TGDH126, TGDH127, TGDH129, TGDH130 and TGDH131 all yielded wide, significantly mineralized intervals across the main Guadalupe vein and have expanded the Las Animas clavo down dip and to the southeast (see attached long section where highlighted intercepts are reported as metres of AuEq at a gold to silver price ratio of 1:60).

A total of 67 RC, 74 diamond core and seven core continuations of RC holes for 14,762 RC metres and 25,704 core metres have been drilled at Guadalupe since drilling commenced in mid-2005.

A map of the Guadalupe Longitudinal Section is available on the Marketwire website at thwe following address: http://www.ccnmatthews.com/docs/PalmarejoMap2_GuadalupeLongitudinalSection.jpg

Quality Assurance

Palmarejo Silver and Gold Corporation has put in place a rigorous QA/QC program consistent with Canadian Securities Administrators National Instrument 43-101 ("NI 43-101") and using best industry practice. The QA/QC program is independently supervised by Keith Blair, Msc, PGeo of Applied Geoscience of Reno, Nevada.

Elements of the program include chain of custody of samples, standard and blank samples submitted to ALS Chemex, with each batch of samples, and a check assay program on a proportion of sample pulps with a second laboratory. Results from the QA/QC program have to date been satisfactory.

Qualified Person

The technical information contained in this release was compiled in accordance with the Listing Rules of the Australian Stock Exchange Limited, by a competent person who is a corporate member of the Australasian Institute of Mining and Metallurgy and who has consented to the inclusion of such technical information in the form in which it appears in this release. The competent person is Kenneth M. Phillips, geologist of VOP Mining Services Pty Ltd who is also a director of Bolnisi Gold NL, the Company's majority shareholder. Mr. Phillips is a qualified person under NI 43-101.

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 resource estimate, potential mineralization, exploration results, 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 October 12, 2006 and particularly in the section entitled "Risk Factors".

For more information about the Company and its projects, please refer to the NI 43-101 Technical Report dated October 1, 2006 and other documents 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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