Premium Exploration Inc.
TSX VENTURE : PEM

Premium Exploration Inc.

May 07, 2008 09:00 ET

Premium Exploration Provides an Update on the Permitting of the Buffalo Gulch Gold Mine

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 7, 2008) - Premium Exploration, Inc. (TSX VENTURE:PEM) ("Premium" or the "Company") is pleased to announce an update on the Buffalo Gulch permitting process.

- Premium Exploration, Inc.'s, joint venture partner (Elk City Mining, LLC) is making progress on permitting the Buffalo Gulch Mine and advancing the project to production. Elk City Mining (ECM) held several public meetings near the project area to initiate the scoping process and inform the public and regulatory agencies of the project.

- The Buffalo Gulch property is in the same geologic environment on the Orogrande Shear Zone as the Friday/Petsite property, which hosts a 531,000 oz Au inferred resource. The Buffalo Gulch target is located at the northern end of the Orogrande Shear Zone while Friday/Petsite is near the southern end of the 26 mile shear zone.

- Core drilling on the Friday/Petsite property has returned grades averaging 9 g/t (0.289 troy ounce per ton) Au over a drill intercept of 70 feet (21.3 meters) including intercepts of five feet (1.5 meters) of 67.89 g/t Au (2.183 troy ounce per ton).

- Buffalo Gulch is open along strike to the north and south as well as down dip.

- The Company is planning deeper drilling at Buffalo Gulch below known mineralization to test a large, IP anomaly which is interpreted to represent mineralization similar to that found at Friday/Petsite.

- Premium controls the north and south ends of the Orogrande Shear Zone.

- For complete terms of the joint venture agreement, please see TSX VENTURE:PEM November 15, 2007 press release.

This gold target was permitted by Bema Gold Corporation's subsidiary (Idaho Gold Corporation) in 1991 as an open-pit gold mine, but was placed on care and maintenance by Bema just prior to mine construction due to low gold prices. Several historical prefeasibility studies indicated that this target was potentially viable as an open-pit gold mine at a gold price of $450 per ounce. Although, a qualified person has not done sufficient work to classify the historical estimates as current mineral resources nor is the issuer treating the historical estimate as current mineral resources, the resource estimate is being revised and will include assays from 13 core holes which were drilled subsequent to the original resource calculations.

ECM has the original Plan of Operations, as well as the final Environmental Assessment for the project which were used to acquire all of the necessary permits from the various United States federal and state regulatory agencies for the construction and operation of the Buffalo Gulch Gold Mine. ECM is using the original documents as the basis for the current Plan of Operations which is the main document for the re-acquisition of the permitting documents, and has converted the original plan of operations and supporting documents including the Environmental Assessment into digital format for ease of use. The digital documents have been provided to the Bureau of Land Management (BLM) for use in the public scoping process. The documents will be available on their website, and the link will be provided once the documents are loaded.

Possession of the original documents is a substantial benefit to the company as the mine plan and design work had been completed and the Plan of Operations has been approved in the past by the regulatory agencies. Presumably this will shorten the permitting timeline as the scope of the project is similar and the agencies have reviewed the documents in the past.

The Company also had meetings with the BLM at their office in Cottonwood, Idaho (which is the office that administers the project area) to determine the scoping timeframes and select a third party contractor. The environmental contractor approved by the BLM is Brown and Caldwell (http://www.brownandcaldwell.com) a nationally recognized engineering and environmental firm specializing in environmental analysis for large projects. The contractor will work directly with the BLM to provide support and develop information in areas where the BLM may not be able to provide resource staff due to other commitments. This commitment has been made by the Company to expedite the scoping process and permitting.

The North Orogrande Shear Zone is comprised of 107 unpatented quartz lode mining claims, and the pre-production Buffalo Gulch gold property is located approximately in the middle of this zone. The prefeasibility studies have not been examined by a qualified person and updated with current costs nor is the issuer treating the prefeasibility studies as current and the historical prefeasibility study should not be relied on.

Qualified Person

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

Premium Exploration, Inc. is focused on precious metals exploration in the United States and Mexico. The Company is founded on a management and geological team with a proven track record demonstrated by their accomplishments. Premium's portfolio currently holds projects in various stages of exploration located within under-explored precious metal belts that potentially host multi-million ounce targets. Utilizing "value-added" and joint venture strategies, Premium maintains multiple interests and royalties in their projects, maximizing shareholder exposure to mineral discovery. Through a joint venture agreement, Premium is advancing the Chrome Mountain PGM project in Montana, USA and the Buffalo Gulch Gold project in Idaho, USA, while negotiations for joint ventures and acquisitions in Mexico are underway. Additional information may be found on our website at http://www.premiumexploration.com.

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 filed 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.

All prospective and current shareholders of Premium Exploration are invited to join the company's official investment forum exclusively at Pinnacle Digest: (http://www.pinnacledigest.com/company/pem:ca). The forum allows for investor controlled discussion, questions and progressive feedback from other shareholders and investors. Third party reports on the company are also available at www.pinnacledigest.com.

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

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