Mineralization Continuity With Strong Drill Results At Lookout Mountain

COEUR D'ALENE, ID - Timberline Resources Corporation reported additional results from the ongoing infill drill program at its Lookout Mountain Project near Eureka, Nevada. Several drill intercepts encountered mineralization greater than one gram per tonne of gold over significant lengths, demonstrating excellent mineralization continuity. Highlights from the latest batch of assay results include: 167 feet (50.9 metres) with an average gold grade of 0.030 ounces per ton (opt) (1.03 grams per tonne (g/t)) in Hole BHSE-134C; 72 feet (21.9 metres)with an average gold grade of 0.033 opt (1.13 g/t), within 249 feet (75.9 meters) with an average gold grade of 0.014 opt (0.48 g/t) in Hole BHSE-145C; 84 feet (25.5 metres) with an average gold grade of 0.037 opt (1.28 g/t) in Hole BHSE-150C; 20 feet (6.0 metres) with an average gold grade of 0.47 opt (16.12 g/t) in Hole BHSE-151C.

Chief Executive Officer, Paul Dircksen, said, "These results continue to strengthen our confidence in the gold resource at Lookout Mountain. The depth and grade of the mineralization are increasing as we drill infill holes to greater depths, and excellent recoveries from bottle-roll tests continue to show that the vast majority of mineralization occurs in oxide material. Where core holes are being drilled for metallurgical testing in close proximity to previous reverse circulation holes, consistent assay results between the holes is confirming our confidence in gold grade continuity. We expect to use these results to upgrade a substantial portion of our Inferred resource into the Measured and Indicated categories."

Timberline''s 2012 drill program at Lookout Mountain has focused on upgrading the gold resource, obtaining material for additional metallurgical studies, testing deeper zones of mineralization, and establishing a series of monitor wells to facilitate advancing the project to a near term production decision. Initial metallurgical recoveries of gold continue to indicate excellent potential for a low capital, low operating cost, heap-leach operation.

Core holes 134C and 140C are twins of, and extend mineralization encountered in, RC holes 070 and 082 that were drilled in 2011 and lost before target depth. All intercepts below 335 feet (102 metres) depth in hole 134C are new, and all intercepts below 380 feet (116 metres) in depth on hole 140C are also new. The higher grades from these deeper intercepts will improve the overall grade in the southern region of the resource, as well as establish continuity in a plus-1 gram zone running north-south through the South Lookout Mountain portion of the resource. Assays are pending on four recently drilled RC holes that will test this same zone 400 - 600 feet (122 - 183 metres) south of holes 134C and 140C.

The company's address is 101 E. Lakeside Coeur d'Alene, ID 83814, 208.664.4859, fax: 208.664.4860.