ELECTRA GOLD LTD. HAS SIGNED A LETTER OF INTENT TO ACQUIRE 28 TWO-POST MINERAL CLAIMS CALLED THE RED DOG CLAIMS, LOCATED NEAR PORT HARDY ON VANCOUVER ISLAND, WHICH ARE REPORTED TO CONTAIN AN HISTORIC RESOURCE OF 28.3 MILLION TONNES OF MINERALIZATION AT .3

The letter of intent requires the Company to pay $15,000 and issue 100,000 shares of the Company to the owners of the claims upon signing.  In addition, the vendor is entitled to a further $45,000 or $25,000 and 100,000 additional shares on the 1st anniversary, $60,000 or $40,000 and a further 100,000 shares on the 2nd anniversary and $75,000 or $55,000 and a further 100,000 shares on the 3rd anniversary.  The determination of which payments shall be made on the 1st, 2nd and 3rd anniversary dates rests with the vendor.

Commencing on the 4th anniversary of closing, the vendor shall be paid $75,000 (advanced royalty) annually until commencement of commercial production.  Upon commencement of commercial production, a minimum annual royalty of $75,000 is required.  The vendor also retains a 3% NSR on metal production and a $0.60/tonne royalty on industrial mineral production.  The Company has the option to purchase 50% of the 3% NSR for $5,000,000.  The letter of intent is subject to TSX Venture Exchange acceptance.

The Red Dog Deposit was initially discovered in 1962 by the current owners or their family.  Since 1962, 10,326 meters (33,879 feet) of diamond drilling has been done on the property.  Management of Electra Gold has engaged J.B. Richards, P.Eng. to consult for the company regarding the exploration and development of the base and precious metal component of the large Apple Bay Property holdings located near Port Hardy, BC.  The Company intends to carry out an aggressive diamond drill program on the Red Dog Claims to further define mineable reserves thereon as well as to expand existing reserves on claims already owned by the Company to the west and north of the Red Dog Claims.  Exploration completed over the years has led to numerous and extensive areas of unexplored targets for further significant base and precious metal discoveries.  Electra Gold management also believes there is significant potential for more industrial mineral type deposits on the Red Dog Property.

Electra Gold Ltd. is a mining company, specializing in industrial minerals and dedicated to preserving the environment.

On behalf of the Board of Directors,

“Douglas Stelling”

Chairman and Chief Executive Officer

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents herein.

For further information, please see website at www.electragoldltd.com or contact Douglas Stelling at (604) 647-2227