PURCHASE AND ROYALTY AGREEMENT

Electra Gold Ltd. (the 'Company') is pleased to announce that it has entered into a Purchase and Royalty Agreement with Homegold Resources Ltd.

('Homegold') and Johan Thom Shearer pursuant to which the Company will purchase the Hankin Point #1 & #2 and the Coal Harbour #1 & #2 mineral claims, all situated in the Nanaimo Mining Division, British Columbia, for a price of $50,000, payable in 500,000 common shares of the Company at a deemed price of $0.10 per common share, together with a royalty equal to $0.60 for each metric tonne of limestone produced or removed from the claims, payable for as long as the Company and/or its successors and assigns holds any interest in the claims.

The Purchase and Royalty Agreement is subject to regulatory approval.

On behalf of the board of Directors of

ELECTRA GOLD LTD.

Doug Stelling, President

CONTACT: TEL: (604) 647-2227 Electra Gold Ltd.

FAX: (604) 669-5375

Email: electragold@telus.net

“ The TSX Venture Exchange has in no way approved or disapproved the contents of this news release”