SOURCE: St. Elias Mines Ltd.

May 09, 2011 08:45 ET

St. Elias Mines Ltd. Terminates an Option to Amarok Resources Inc. and Grants an Option to Intigold Mines Ltd. to Acquire a 60% Interest in the Cueva Blanca Gold Property, Peru

VANCOUVER, BC--(Marketwire - May 9, 2011) - Lori McClenahan, President of St. Elias ("St. Elias" or the "Company") (TSX-V: SLI) (FRANKFURT: EKL) (PINKSHEETS: SELSF) announces that the Company has terminated a Letter Agreement dated April 16, 2010 with Amarok Resources Inc. ("Amarok"), with respect to an acquisition of a 60% interest in the Company's Cueva Blanca Gold Property (the "Property").

The Company further announces that it has now entered into a Letter Agreement with Intigold Mines Ltd. ("Intigold") whereby the Company has granted an option to Intigold to earn a 60% carried interest, subject to a 1.5% net smelter return royalty ("NSR"), in the Property located in northern Peru. Intigold is a publicly traded mineral exploration company.

Cueva Blanca Gold Property, Peru

The Property covers 1,200 hectares and is located in the Lambayeque Department in northern Peru along the same geological trend as a number of multi-million ounce deposits including Yanacocha, Pierina and Lagunas Norte.

The Cueva Blanca is a promising high-grade gold/silver vein prospect with common geologic characteristics to the El Dorado deposit in El Salvador, which is a unique type of epithermal deposit that formed in a specific geologic environment. Examples of this type of system are El Pinon in Chile, the Midas and Sleeper Mines in Northern Nevada, and the El Limon Mine in Nicaragua.

Cueva Blanca exploration history has followed the classic pattern: acquisition based on geologic reasoning; property-wide prospecting and subsequent discovery of precious metal showings; detailed surface exploration of mineralized zones; and initial diamond drilling. The historical results provide an indication of the potential of the Property and are relevant to continuing exploration.

Historical exploration work on the Cruz vein system, which included 91 trenches and 18 drill holes totalling 1,860 metres, proved that the quartz veins consistently contain gold and silver and that the Cruz vein system is a classic epithermal gold-silver deposit. Historical results of gold assays from the Cruz vein drill program include 6.0m of 2.31 g/t, 6.0m of 2.96g/t (including 1.75m of 7.45 g/t), 1.5 m of 22.68 g/t; 9.5m of 8.09 g/t (including 1.5m of 35.84 g/t); 10.8m of 2.4 g/t and 1.2m of 6.95g/t. The vein intersections contain virtually no sulfides. The vein system is open along strike to the SE and NW, and to depth. (Source: Summary Report, Sivertz, 1999.)

While the company has no reason to doubt the accuracy of the historical results, the data should not be relied upon until confirmed by the Company's own exploration that meets NI 43-101 standards for disclosure. Historical results and the work that generated them predate the enactment of National Instrument 43-101 and accordingly may not meet the requirements of that policy.

Cueva Blanca Property Agreement

Under the terms of the letter agreement, Intigold can acquire a 60% carried interest in the Property (subject to a 1.5% NSR) in consideration of:

(a) making cash payments of $200,000 to St. Elias over a two-year period;
(b) issuing 1,000,000 common shares in the capital of Intigold to St. Elias; and
(c) incurring $1,500,000 in exploration expenditures on the Property over a three-year period.

In addition, Intigold shall have the right to purchase one-half of the 1.5% NSR from St. Elias for the sum of $1,500,000 thereby reducing the NSR payable to from 1.5% to 0.75%.

Qualified Person
All technical work is being supervised by, and the contents of this news release have been verified by, John Brophy, P.Geo., a Canadian geologist residing in Peru, who is a "qualified person" as defined in National Instrument 43-101, Standards of Disclosure for Mineral Projects.

For additional information on St. Elias and its projects, please visit us at www.steliasmines.com or call 1-888-895-5522 (toll free US and Canada) or contact:

European Contact
Michael Kott
CM-Equity AG & Co. KG Financial Service
Tel: 011 4989 1890 474 0
Email: kott@cm-equity.de

U.S. Contact
Herbert Haft
The Haft Group, Inc.
Tel: (212) 759-8865
Email: herbhaft@haftgroupinc.com
herbhaft@aol.com

ST. ELIAS MINES LTD.

(signed "Lori McClenahan")
Lori McClenahan,
President

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

This News Release may contain forward-looking statements including, but not limited to, comments regarding the timing and content of upcoming work programs, geological interpretations, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statement.

Contact Information