October 15, 2008

Elray Enters JV to Develop Indonesian Zircon Sands Project

Elray Resources, Inc. (OTCBB: ELRA), a technically-driven gold and precious metal mineral exploration company, announced today that it has acquired a 50% interest in a highly promising zircon sands mining project in Central Kalimantan, Indonesia.

The joint venture partner, PT. Indo Imperial Resources Tambang, has been successfully operating the project on a small scale for the last two years, and is teaming up with Elray Resources to provide the resources and technical expertise required to take production to the next level.

Data available from the project demonstrates that the zircon is of a very high quality so will command premium prices. Average grades for all recent samples are as follows:

 -------------------------------------- Moisture        ZrO2       ZrO2 + HfO2 -------------------------------------- 0.03            52.8              54.0 --------------------------------------                 52.8              54.0 --------------------------------------                 52.6              53.9 --------------------------------------  Average        52.8              54.0 -------------------------------------- 

Elray Resources intends to conduct a comprehensive exploration program and independent feasibility study on the project. This will largely comprise drilling / test pitting programs, trace element analysis, metallurgical testing for plant specification and design, and financial modelling. By-product opportunities, including for gold, illmenite and rutile will be investigated.

"With increasing demand for high quality zircon, particularly in China, this project has the potential to very successful," commented Mr. Barry Lucas, Executive Chairman of Elray Resources. "The project requires low capital expenditure to increase production and we fully expect the use of new more efficient recovery technologies to enable rapid revenue stream development and attractive returns."

About Elray Resources, Inc.

Elray Resources, Inc. is a junior exploration and development Corporation which has successfully accumulated a portfolio of highly prospective, heavily mineralized mining tenements in South East Asia and North America. Elray Resources, Inc.'s, primary objective is to source projects, conduct geological assessments and seek Joint Venture partners to develop the properties.

This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Actual results may differ from management's expectations. These forward-looking statements involve risks and uncertainties that include, among others, risks associated with gold & precious mineral exploration risks related to competition, management of growth, new products, services and technologies, potential fluctuations in operating results, international expansion, commercial agreements, acquisitions and strategic transactions, government regulation and taxation. More information about factors that potentially could affect the Company's financial results is included in its filings with the Securities and Exchange Commission.

 Contacts: Elray Resources, Inc. Jake Harris Investor Relations (347) 410-9782 Email: [email protected] Website: www.ElrayMining.com

SOURCE: Elray Resources, Inc.