August 27, 2008

Lexam Second Quarter Results

(All amounts expressed in Canadian dollars unless otherwise stated)

LEXAM EXPLORATIONS INC. (TSX VENTURE: LEX)(PINK SHEETS: LEXEF)(FRANKFURT: D2Q) is pleased to announce financial results for the second quarter 2008, an update on the Otish Uranium Project in Quebec, Canada and the Baca Oil and Gas Project in Colorado, USA.


- Otish Uranium: Drilling has started on the Mistassini portion of the project. The two objectives are to 1) confirm reported grades of up to 0.51% U3O8; and 2) connect the two identified uranium zones along a strike length of 2.4 km. Initial assay results will be released in early September.

- Airborne survey completed over the eastern Otish portion of the property. Will be used to identify additional areas that are prospective for uranium mineralization.

- Rubicon Minerals intersects high-grade gold in Red Lake, Ontario. Best hole returns 26.0 opt gold over 6.6 feet (891.1 gpt gold over 2.0 meters). Lexam's 5.3 million shares are now worth $9.7 million (as of August 27, 2008).


Second Quarter - 2008

For the three and six months ending June 30, 2008, Lexam reported a loss of $811,009 ($0.02 per share) and $1,715,231 ($0.04 per share) compared with a gain of $11,967,612 ($0.25 per share) and $10,332,919 ($0.21 per share) in the respective periods, 2007. The net income recorded for the prior year was primarily attributable to the gain recorded on the sale of the Company's Nevada and Yukon properties.

The loss during the second quarter of this year was due to Lexam selling certain securities at a price that was below their fair market value recorded at the time the shares were received ($0.5 million), despite the Company's cost basis being below the price sold, administrative ($0.2 million) and exploration expenses ($0.1 million).

For the second half of 2008, Lexam forecasts exploration expenses of $1.5 - $2.0 million related to the current drill program in the Otish Uranium Project. Approximately 40% of the total exploration cost will be paid back to Lexam by the Quebec government in accordance with the province's rebate policy.

At the end of the second quarter Lexam had a working capital of $10.1 million, compared with a working capital of $12.8 million in 2007. Total shares outstanding remained unchanged at 48,469,287.

The complete second quarter report, including management's discussion and analysis, financial statements, and notes can be found on the Company's website at and on SEDAR at


The Otish Uranium Project totals 213,059 acres and is located in north-central Quebec, Canada. Lexam has an option to earn 50% of the project from Golden Valley Mines by spending $3 million over three years. To date, approximately $978,000 has been spent by Lexam on the project.

Since exploration began in June, Lexam and Golden Valley have completed 37 core holes for a total of 1,546 m (5,070 ft). Drilling was focused on confirming and expanding the identified zone of uranium mineralization in the Mistassini portion of the project that was originally discovered in 1979 by Western Mines Ltd. Holes within the zone were reported to reach up to 5100 ppm (0.51%) U3O8, and ten holes returned values better than 850 ppm (0.085%) U3O8 over a strike length of approximately 80 meters (262.5 ft.). Initial assay results are expected to be released in early September.

The targeted U3O8 mineralization is shallow, located about 20 meters (65.5 ft.) below surface. The mineralized zone is spatially related to the unconformity (up to 5 meters (16.4 ft.) above it) occurring next to the margin of the sedimentary basin along a bedding facies contact of upper coarser grained arkose-conglomerate with finer and variable graphitic wacke. The approximate thickness of the mineralized zone is 5 meters (16.4 ft.). The inferred strike extension of the zone was intersected in drilling by SOQUEM in 1979 about 2.4 km to the north along trend. Here a single hole intersected a best value of 1040 ppm (0.1040%) U3O8.

An additional 2,500 m (8,200 ft.) of core drilling is planned as part of the current exploration program. Drilling will look into expanding upon the initial results, determine if the two known zones, situated along strike connect, and test other prospective targets on the property.

In addition to core drilling an airborne geophysical (radiometric-magnetic-VLF) survey was completed over the eastern portion of the project area that was intended for last year's program but was delayed due to adverse weather conditions. Lexam and Golden Valley Mines believe the airborne survey is an excellent tool that will allow it to target prospective areas for uranium.


In early 2007 Lexam announced that it had traded its Nevada properties for Rubicon common shares. Since then, Rubicon has announced exciting drill results from its Phoenix Gold Project, located in the heart of the prolific Red Lake gold district of Ontario.

Recent drilling announced by Rubicon on August 26, 2008 included 26.0 opt gold over 6.6 feet (891.1 gpt gold over 2.0 meters). This exciting result, along with previously announced drill holes, has begun to capture the attention of the investment community.

Lexam owns approximately 5.3 million shares of Rubicon that have a current market value of $9.7 million (as of August 27, 2008). It is important to note that Lexam has prepaid taxes in relation to these shares based on Rubicon's share price at the time the shares were received (US$2.00 per share). Therefore, Lexam is not required to pay any additional tax until Rubicon's shares exceed US$2.00 per share (Rubicon's share price as of August 27, 2008: US$1.80).


Lexam was informed on March 3rd, 2008 by United States Fish and Wildlife Service (USFWS) that the draft Environmental Assessment (EA) that was being prepared in conjunction with the Company's proposed drilling had been completed and that all public comments had been received. Since then the USFWS has been preparing responses to the public's comments and reviewing the draft EA in order to make a decision regarding the level of impact Lexam's proposed exploration activities will have on the federal land.

If the USFWS determines that Lexam's proposed exploration will not have a significant environmental impact the Company is planning to proceed with road and well pad construction as soon as possible in preparation for its planned drilling activities.

The USFWS decision is not whether Lexam has the right to conduct exploration activities, but determines the necessary measures to be taken in order to mitigate any possible surface disturbance, which may include conducting additional environmental studies.

Michael P. Rosatelli, P. Geo. is a "Qualified Person" as defined in National Instrument 43-101 and is responsible for the technical information presented in this news release regarding the Otish Uranium Project.

About Lexam

Lexam Explorations is a North American based energy exploration company. The company is advancing the Baca Oil & Gas Project located in south-central Colorado, USA, which is 75% owned by Lexam and 25% by ConocoPhillips and has an option to earn 50% interest in Golden Valley Mines' Otish Basin uranium project located in Quebec, Canada.


Some of the statements contained in this release are "forward-looking statements". Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from anticipated results include risks and uncertainties such as: ability to raise financing for further exploration and development activities; risks relating to estimates of reserves, deposits and production costs; extraction and development risks; the risk of commodity price fluctuations; political, regulatory and environmental risks; and other risks and uncertainties in the reports and disclosure documents filed by Lexam from time-to-time with Canadian securities regulatory authorities. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The complete second quarter report including management's discussion and analysis, financial statements and notes can be found on our Company's website at and on SEDAR at

 Contacts: Lexam Explorations Inc. Ana E. Aguirre Manager, Investor Relations (647) 258-0395 or Toll Free: 1-866-441-0690 (647) 258-0408 (FAX) Email: [email protected] Website: