Premium Exploration Inc.

Premium Exploration Inc.

November 06, 2006 11:44 ET

Premium Exploration Increases Land Position to 17,950 Hectares and Initiates Exploration at Nueva Galicia Silver-Gold Project in Mexico

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 6, 2006) - Premium Exploration, Inc. (TSX VENTURE:PEM) ("Premium" or "the Company") is pleased to announce that the Company has acquired, by staking, an additional 1,910 hectares adjacent to and within its Nueva Galicia Project ("the Project") located in the State of Nayarit, Central Mexico. This brings Premium's total land position at Nueva Galicia to approximately 18,000 hectares.

Premium has initiated an exploration program of detailed sampling and mapping to develop drill targets for testing in January 2007. The Company's current exploration program will include re-sampling of a representative percentage of underground workings and surface samples, as well as detailed structural and alteration mapping to develop drill targets which will test the continuity of high-grade ore shoots.

The Tajitos ore shoot, which was mined by the Spaniards, was sampled by the Mexican Geological Survey in 1983. Ninety-eight samples from five levels returned grades of up to 22.4 g/t Au 1300.0 g/t Ag over widths from 0.8m to 1.7m along a strike length of 320m, a vertical distance of 145m, with an average grade of 7.95 g/t gold and 284 g/t silver (13.63 g/t gold equivalent) over 0.80m. Highlights of sampling from a previous Canadian operator include 70 samples with a grade exceeding 5.0 g/t gold equivalent, with the highest grade result of 219 g/t gold and 586 g/t silver from a 1.5m rock chip surface sample at San Ramon. The reader is cautioned that Premium has not independently verified these grades. Re-sampling of these workings is part of the current exploration program at Nueva Galicia.

Premium's COO and geologist Nancy Reardon states, "Nueva Galicia is a strongly mineralized epithermal vein system that contains high-grade to bonanza silver and gold values over significant strike lengths and vertical distances. This is demonstrated by the extensive work done in the past on surface and in numerous underground workings. The entire system, within Premium's claims, extends for over 10 km, with at least three sub-parallel veins, and mineralization exposed continuously over 145m and discontinuously over 650m vertically. The Spaniards only scratched the surface here, and I expect to encounter more high-grade shoots during our upcoming exploration programs. This part of Mexico is the up-and-coming address for the discovery of precious metals deposits in Mexico."

The Nueva Galicia Project is located immediately south of Cream Mineral's Nuevo Milenio Project, where a NI 43-101 compliant inferred mineral resource of 13,120,000 tonnes containing 268,000 oz. gold and 30,340,000 oz. of silver have been identified so far. Rochester Resources is completing a 200 tpd mill for the initiation of production at their Mina Real Project, approximately 50 km from Nueva Galicia, which geologically and mineralogically is very similar to Nueva Galicia. These projects demonstrate the potential and viability of mineralization in this part of Mexico.

The Company's base of operations for the project has been established in Compostela, a town of 17,000 inhabitants located four kilometers from the Nueva Galicia at the junction of two major paved routes between Tepic, the state capital, Guadalajara, and Puerto Vallarta. Electric power lines pass within one kilometer of the Project, and an operating railway line crosses the northwest corner of the Project. A gravel road provides access to the center of the property where known high-grade ore shoots are located. Water is available year-round.

The Company can earn 100% of the property by making staged cash and share payments over four years totaling US$1,000,000 and issuing 500,000 common shares of the Company and by incurring expenditures totaling US$1.8-million.

Mr. Wilf Struck, P.Eng., geologic consultant to the Company, is the Qualified Person ("QP") responsible for the technical disclosure in this press release, in accordance with National Instrument 43-101.

About Premium Exploration, Inc.:

Premium Exploration, Inc. is a precious metals exploration company focused on prospect generation, evaluation and exploration in North America. The Company is listed on the TSX Venture Exchange and has assembled an innovative and experienced management and advisory team who are committed to the long-term success of the Company. Premium's goal as a prospect generator is to discover precious metal deposits that are strategically located in areas that would allow their profitable extraction, with minimal political, social or environmental risks. Current holdings are in Mexico and the USA. To maximize the possibility of realizing this goal, the company's exploration team continues to find and review early-stage projects located within under-explored precious metal belts that host multi-million ounce deposits. By acquiring prospects internally and financing some of them through joint venture partners, the company is able to maximize the potential for discovery while mitigating risk and increasing shareholder value.

More information can be found on our website at or on the SEDAR website at

The information in this press release is not NI 43-101 compliant and should not be relied upon as such. This press release contains certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Security Exchange Act of 1934, and involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents files from time to time with the TSX Venture Exchange and the British Columbia Securities Commission. All statements, other than of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.

Information contained in this news release includes information about adjacent properties on which we have no right to explore or mine. We advise investors in the United States that the SEC's mining guidelines strictly prohibit information of this type in documents filed with the SEC. United States investors are cautioned that mineral deposits on adjacent properties are not indicative of mineral deposits on our properties.

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

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