INDIAN RIVER CLAIMS

The companies deemed that probable reserves identified to date, based on drilling of over 600 holes on 60% of the Indian River property, calibrated by bulk sampling, is in the order of 66,000 crude ounces of gold, and sufficient for mine development. Gold was recovered from nearly 100% of the holes in the main target area. The target zone forms a wedge that is 300 meters/984 feet at the beginning and broadens to a width of over 1,500 meters/4,921 feet. To date, the mineralized zone extends over a distance of more than 3 kilometers/1.9 miles) and remains open to expansion to the east and south. Gold is uneven but consistently distributed across this broad area with gold values present across the entire width of the property. The fineness of the gold assayed at over 82%. If mining results are typical of the industry’s experience in the Klondike, the extent of mineralization could be higher by as much as 20-30%. Hans Boge, P.Eng., President of Klondike Star Mineral Corp., says: “At current and projected gold prices, even this relatively modest gold deposit is worthy of development. Furthermore, Klondike Star is already fully permitted to develop and operate the Indian River gold mine.” The Company’s development plan is to phase into production starting with large-scale test mining. The approach offers financial, tax, risk management and operational advantages. Stripping of the organic ground-cover and non-gold bearing gravels is currently scheduled to commence late fall/early winter. The mining plan designed specifically for the Indian River ground is scaleable allowing for substantial increases in annual gold production over time.

The Indian River gold project (placer) has shifted from advanced-stage exploration to the pre-development stage. This has included the completion of a major drilling program, bulk sampling, an environmental and socio-economic assessment of the project by the public, governments and regulatory authorities, the issuance of the authorization to develop and operate the mine, and substantial progress on mine planning and analysis for the determination of a mineral reserve and development decision-making. During the 2007 summer exploration season, a second representative site was completed with an area of 1,624 square yards of which 6200 cubic yards were processed in 9 separate “lots” to recover 32.8 troy ounces of raw gold (0.75 g per square meter). A third site, B-3, was stripped of overburden in preparation for sluicing, but this could not be accomplished by the end of the season.

Reported that the third consecutive winter drilling program commenced in late November 2006 and concluded in April 2007. Klondike Star completed 141 holes totaling 967 meters (3,173 feet), almost entirely in the main target zone. This increases the cumulative three-year total to 415 holes encompassing 3,393 meters (11,132 feet). Gold was recovered from 100% of the holes in the main target area (107 holes). During 2006, additional baseline work was undertaken to consolidate and ground-truth previous exploration results, with the focus on two claim blocks. The first involved an eastern extension of 2005 soil and rock sampling done to determine the presence of gold anomalies on the property (Reka claim block). The second (RMB claim block) pursued 2005 rock chip assays with elevated PGM values, targeting platinum group minerals to identify any PGM, as well as Ni, Cu and Au targets.