Electra Gold Receives Favourable Coal Report

Electra Gold is pleased to report that a NI 43-101 Compliant Report has been received on its Suquash Coal Project.  This report will be posted on SEDAR and on the Company’s website shortly.

Coal has been worked from locations within and adjacent to the Suquash coal property at various times in the past 160 years. Most of the workings have been underground, via the shaft of Suquash Colliery, whose workings extended out beneath Queen Charlotte Strait as well as into onshore areas. Some artisanal opencast workings were operated along the shoreline, at the mouth of Suquash Creek.

In 2008, Electra Gold Ltd. drilled four diamond-drill boreholes within the present Suquash coal property. This drilling programme was conducted under terms of Mineral & Coal Activities & Reclamation Permit MX-80255 (see News Release 08-10-09).  All four of the year-2008 boreholes reached their target coal, the Suquash No.2 zone, and one of the boreholes (SQ-08-4) reached down past the underlying No.5 zone. Boreholes SQ-08-01 through SQ-08-04 are regarded as ‘current boreholes’ for the purposes of the present report.

Verification of regional geology, local presence of potentially-mineable coal, lateral continuity of the Suquash No.2 coal zone, and amount of coal in place at various levels-of-assurance has been accomplished by means of geological mapping, review of historic drilling, interpretation of borehole geophysical logs, analytical work including densimetric (float-sink) studies, construction of a volumetric model of the coal deposit, and coal-resource estimation.  The coal’s rank is High Volatile B to C bituminous, based on on analytical results from the current boreholes.

The Suquash No.2 coal bed within the Suquash coal property, owned by Electra Gold, is considered to contain 4.823 million tonnes of measured and indicated resources of immediate and future interest for underground mining. Of these, 0.812 million tonnes are of immediate interest, in coal beds with a gross thickness of at least 1.5 metres, and a coal:rock ratio by thickness of at least 2:1. The remainder, 4.011 million tonnes, are of future interest, in coal beds with a gross thickness of at least 0.9 metres, and a coal:rock ratio by thickness of at least 1:1.

Exploration work done to date on the Suquash coal property has been successful, in that it has disclosed the presence of potentially-mineable coal of a grade suitable for thermal-power generation (if the coal is washed at a low separating density) or for other industrial use.

From the results of float-sink testing, it is concluded that it may be feasible to scalp off a low- ash, low-sulphur, moderate-BTU clean coal at a low separating density, and that much of the unwanted sulphur from the raw coal will report to the middlings density fractions.  It is thus considered that raw coal from
the No.2 coal bed could be washed for a modest yield of low-ash and low sulphur coal for thermal-power markets.

By using a higher separating density, it may be possible to produce a reject rock product with acceptably low sulphur content for industrial use such as cement-mill feedstock, but this will depend on the available proportion of low-sulphur ‘basal’ material from the No.2L zone, as compared with the higher-sulphur rock from the No.2 coal bed. Silica/alumina ratios of the middlings/rock material are higher than the desired 2:1 for cement-mill feedstock, but that deficiency could be readily addressed by blending with an external source of high alumina material, such as the material which Electra Gold is presently producing from its PEM100 chalky geyserite quarry, situated northwest of Suquash.

Coal resources at Suquash are contained within the Suquash No.2 coal bed, part of the Suquash Formation of Upper Cretaceous age.  These resources are of immediate and future interest for underground coal mining.  Resources of measured, indicated and inferred levels-of-assurance have been recognized; as well, some resources are recognized as being sterilized owing to proximity to existing
underground mine-workings of Suquash Colliery.

For the purposes of the study, sterilized resources are those which would otherwise qualify as being
measured resources, but which lie within 50 metres of workings of Suquash Colliery. Regardless of thickness, sterilized resources are considered as being of future interest.

Coal volumes were determined by measurement of polygonal areas controlled by four current (year-2008) and five historic (pre-2008) boreholes.  An historic data confidence factor was applied to coal  volumes derived from historic boreholes; as well, geological confidence factors, reflecting various distances from boreholes, were applied to all coal volumes.  A bulk density factor of 1.5 tonnes per cubic metre was used to convert in-situ volumes of coal to in-situ tonnages of coal.

Coal resource estimates here presented have been prepared by C.G. Cathyl-Bickford, P.Geo.(BC) Lic.Geol.(WA), acting in her capacity as an independent qualified person.  In accordance with National Instrument 43-101, reporting of resources has used the Definition Standards on Mineral Resources and Reserves adopted by the Canadian Institute of Mining, Metallurgy and Petroleum in 2004. Reporting is consistent with Canadian practice as recommended by A Standardised Coal Resource / Reserve Reporting System for Canada, Paper 88-12 (“GSC 88-12”) of the Geological Survey of Canada, with certain adaptations to local conditions as permitted by GSC 88-12.

Caveats concerning coal resources
a. Coal resources (as distinguished from coal reserves) do not have demonstrated economic viability.
b. The Suquash No.2 coal bed contains partings of coaly and non-coaly rock, and sometimes also layers and lenses of ‘dirty’ (high-ash) coal. These impurities act to increase the overall ash content and specific gravity of the coal zone, and decrease the calorific value of the mined product. Such partings are a normal occurrence within coal beds, and their presence at Suquash is not, in the author's opinion, an unusual impediment to mining.
c. Coal resources available to mining may be adversely impacted by environmental or socioeconomic policy decisions made by provincial and federal government agencies.

Silica (SiO2) /alumina (Al2O3) ratios of ash from the clean coal and middlings/rock material range from 1.84 to 2.03 for the clean coal, and 2.30 to 2.71 for the middlings/rock. The middlings/rock material would need further blending with a source of high-alumina material, were it to be used as a blend component in cement-making.

Further exploration work will be guided by the concept that the coal of the Suquash No.2 coal bed formed within a coastal plain environment, oriented along a northwest-trending paleoshoreline.  It is also noted that such paleoshoreline-associated elongate coal deposits are known from elsewhere on Vancouver Island (for example, the No.4/fL coal zone of the Quinsam Mine and Quinsam North coal properties).

C.G. Cathyl-Bickford P.Geo. Lic. Geol.,, is the Qualified Person as defined by NI 43-101 who supervised the preparation of the technical material of this release.

On behalf of the Board of Directors,

J. T. Shearer
President, Director

Forward-Looking Statement

This document may contain or refer to forward-looking information based on current expectations, including, but not limited to timing of mineral resource estimates, future exploration or project development programs and the impact on the Company of these events. Forward-looking information is subject to significant risks and uncertainties, as actual results may differ materially from forecasted results. Forward-looking information is provided as of the date hereof and we assume no responsibility to update or revise them to reflect new events or circumstances. For a detailed list of risks and uncertainties, as it relates to Electra Gold Ltd., please refer to the Company's 2008 Annual Financials filed with SEDAR on April 30, 2008.

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 Jo Shearer at
(604) 696-1022 or (604) 970-6402.