Drill Program At South Eureka Project  

COEUR D'ALENE, ID - Timberline Resources Corporation reported that it has mobilized a surface drill and has begun the diamond drilling segment of its exploration program at its recently-acquired South Eureka property in Nevada's Battle Mountain-Eureka gold trend. Timberline also expects to begin a complementary RC drill program there within the next several weeks.

The South Eureka property, including the Lookout Mountain project, was the primary exploration asset Timberline acquired in its acquisition of Staccato Gold Resources, Ltd ("Staccato") in June 2010. A significant exploration plan will be undertaken at the South Eureka property with a focus on the Lookout Mountain project. Lookout Mountain is a typical sediment-hosted gold project with historic gold production and a previously-reported gold resource in excess of 800,000 ounces. Timberline's exploration objective is to confirm the existing resource and apply economic parameters as part of a preliminary study to determine the economic feasibility of the project. Geologic mapping of the property will also continue in order to better understand ore controls, for targeting purposes, and for geologic modeling. Current drill data, preliminary metallurgical testing, and current gold prices indicate a low-cost, low-grade oxide, heap-leachable gold mine could potentially be developed. Timberline's exploration program will include in-fill, metallurgical, and geotechnical drilling to establish the continuity of gold mineralization, metallurgical characteristics, and engineering parameters of the deposit. Metallurgical characteristics of collected ore samples will be independently tested and analyzed. Paul Dircksen, Executive Chairman and Vice President of Exploration, said, "We are excited to begin our 2010 exploration and drilling program at the South Eureka property. Our analysis during the Staccato acquisition due diligence indicated a sizeable economic deposit, and our objective with this exploration program is to confirm those indications and further expand the resource. Our drilling will focus on the Lookout Mountain project area, with exploration drilling on other targets within the property." The Lookout Mountain project is an advanced-stage gold property at the pre-feasibility level, strategically located within the southern portion of Nevada's productive Battle Mountain-Eureka gold trend. A total of 533 holes have been drilled at the project, totaling over 267, 000 feet. The total land package, exceeding 15,000 acres, encompasses a 4-mile strike length of structurally and stratigraphically controlled gold mineralization. All outlined mineralized zones are open and require additional in-fill and step-out drilling in order to initiate a Timberline preliminary economic scoping study. Additionally, a number of identified drill targets will be tested for potential resource expansion. The company's address is 101 E. Lakeside,Coeur d'Alene, ID 83814, 208.664.4859, fax: 208.664.4860, email: e-mail: [email protected], www.timberline-resources.com.