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Premium Exploration Provides Update on Its Buffalo Gulch Joint Venture Project

August 26, 2008

VANCOUVER, BRITISH COLUMBIA–(Marketwire – Aug. 25, 2008) – Premium Exploration, Inc. (TSX VENTURE:PEM) (“Premium” or the “Company”) (www.premiumexploration.com) is pleased to provide the following update on its joint venture with Clearwater Mining Corporation (“CMC”) for the Buffalo Gulch open pit heap leach gold mine project located near Elk City, Idaho, United States of America.

Highlights Include:

– Publication on August 15, 2008 in the United States Federal Register of a Notice of Intent (“NOI”) for the preparation of the required Environmental Impact Statement (“EIS”) for the proposed Buffalo Gulch Mine by the United States Department of Interior, Bureau of Land Management (“BLM”).

– On August 15, 2008 the required 30-day public scoping and comment period for the EIS began.

– On August 28, 2008, there will be a public tour of the proposed Buffalo Gulch mine site, followed by a public meeting at the Elk City Ranger Station in Elk City Idaho.

– A Memorandum of Understanding (“MOU”) is being finalized between the BLM and Elk City Mining, LLC (“ECM”). Elk City Mining, LLC is the joint venture company owned by Premium and CMC that is advancing the Buffalo Gulch project. The MOU:

— designates the BLM Cottonwood Field Office as the lead government oversight agency for preparation of the EIS;

— appoints the engineering firm of Brown & Caldwell (www.brownandcaldwell.com) as the third-party engineering firm responsible for preparation of the EIS; and

— provides for an estimated timeline of August 2010 for publication of the Final EIS and Record of Decision on the Buffalo Gulch project.

– A website for the Buffalo Gulch project may be viewed at http:/ /www.elkcitymining.com.

The publication of the NOI on August 15, 2008 started the official 30-day public comment and project scoping period required for the preparation of an EIS. The comment period ends on September 15, 2008. The NOI can be viewed on the BLM website at http:// media3.marketwire.com/r/BLM1. Those wishing to submit comments on the Buffalo Gulch project should submit them to Mr. Scott Sanner, Mining Engineer with BLM at the contact information provided at the end of this update.

The public tour and meeting will begin at 1:30 PM on August 28, 2008 at the Elk City Ranger Station, and last until approximately 9:00 PM. Additional information on the public site visit and meeting can be viewed on the BLM’s web site at http://media3.marketwire.com/ r/BLM2. Representatives of the BLM, Idaho Department of Environmental Quality, and other interested government agencies will be participating in this public meeting and tour. During the tour, the plan of operations for the proposed mine will be publicly reviewed and the public will have an opportunity to submit comments and questions to ECM and the agency representatives present.

It is expected that the MOU being negotiated between the BLM and ECM will be finalized shortly. The MOU provides for the appointment of Brown & Caldwell (www.brownandcaldwell.com) as the independent third-party engineering firm for preparation of the EIS. Brown and Caldwell, established in 1947, is a multi-disciplined environmental engineering and consulting firm. It is an employee-owned company headquartered in Walnut Creek, California, and employs more than 1,500 people in 45 offices across the United States of America. Engineering News-Record ranks Brown and Caldwell 48th among the nation’s top 500 engineering firms, 36th among the Top 200 environmental firms, 21st largest in the Water Supply market and 8th largest in the Sewer/Waste market.

The MOU identifies the following key milestones and their anticipated timeline for completion:

——————————————————————– —– __________________________________________________________Estimated Date Key EIS Milestone________________________________________ of Completion ——————————————————————– —– Federal Register Notice of Intent published – start of Scoping Period.________________________________________August 15, 2008 ——————————————————————– —– EIS field work completed; environmental impact analysis prepared and technical reports completed.________June 2009 ——————————————————————– —– Preliminary Draft EIS to BLM and interagency personnel for review.____________________________________ July 2009 ——————————————————————– —– Preliminary Draft EIS comments to Brown and Caldwell.____ July 2009 ——————————————————————– —– Final Review by BLM of Draft EIS (“DEIS”)________________ October 2009 ——————————————————————– —– Publication of DEIS and Notice of Availability (“NOA”) in Federal Register. Starting the 60 day public comment period on the Draft EIS.__________________ November 2009 ——————————————————————– —– Public comment meetings held on the DEIS.________________ November 2009 ——————————————————————– —– DEIS public comment period ends. Brown & Caldwell analyzes public comments and submits summary report to the BLM.________________________________________February 2010 ——————————————————————– —– Preliminary Final EIS drafted by Brown & Caldwell__ and delivered to the BLM for Review.______________________April 2010 ——————————————————————– —– Release and distribution of the Final EIS and publication of NOA in the Federal Register. 60-day comment period on the Final EIS begins.____________June 2010 ——————————————————————– —– Comment period ends for the Final EIS.____________________August 2010 ——————————————————————– —– BLM issues the Record of Decision on the Buffalo Gulch__ Project EIS.______________________________________________August 2010 ——————————————————————– —–

As the EIS process proceeds Premium will provide additional updates as to the status of the milestones and their anticipated completion timelines. It is expected, pending issuance of all the necessary permits, that mine construction and operations will commence as soon as possible after issuance of the Record of Decision on the EIS by the BLM.

Qualified Person

Mr. Wilf Struck, P.Eng., is the Qualified Person for the technical information in the news release under National Instrument 43-101.

About Premium Exploration, Inc.

Premium Exploration, Inc. is a unique precious metals explorer focused on Mexico and the USA. Listed on the TSX Venture Exchange (TSX VENTURE:PEM), the Company was founded on a team with exploration success, committed to maximizing shareholder exposure to precious metals discovery, the most profitable stage of exploration. Premium’s portfolio holds gold, silver and platinum group metals projects in various stages of exploration, from grassroots to near- term production. Premium’s business model utilizes the joint venture approach where strategically chosen projects are quickly advanced. This model allows the Company to focus its exploration efforts in under-explored precious metal belts that would allow for profitable extraction, with minimal political, social or environmental risks. Additional information on the Company may be found at http:// www.premiumexploration.com.

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/pemca. 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 http://www.pinnacledigest.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 involves 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.

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