St. Elias Mines Ltd. Ramping up to 500 Tonnes Per Month at Tesoro Gold Project, Peru

    VANCOUVER, BRITISH COLUMBIA, May 10 /CNW/ - St. Elias Mines Ltd. ("the
Company") (TSX VENTURE:SLI) (ISIN CA7849211080) (FWB:EKL) provides the
following update regarding the Tesoro Gold Project (the "Project") located in
southwestern Peru. As a result of the recent discovery of the A-4 Vein System
and consistent high grades received from bulk sampling, the Company has
decided to focus its exploration activities on this Project and has developed
the following plan to significantly expand existing operations.

    The objective of the plan is to achieve a sustainable economic production
to support two to three years of production at a rate of 300 to 500 tonnes per
month while concurrently defining resources and reserves. This is a
forward-looking statement. Forward-looking statements address future events
and conditions and therefore involve inherent risks and uncertainties. Actual
results may differ materially from those currently anticipated in such
statements. There is no guarantee that the Company will achieve these
objectives.

    The Tesoro Project

    The Tesoro Gold Project is situated in a highland desert plateau in
southwestern Peru. The Project is 100% owned by St. Elias with no underlying
royalties. The Project is located within the well-known Nazca-Ocona Gold Belt
where there are at least 70 known gold deposits comprising narrow but
generally high-gradegold-bearing quartz veins. Although the veins are narrow,
the mineralized structures tend to extend along strike for kilometres and to
depths of 1,000 metres. Evidence indicates that the Project has the potential
to host a million ounces of gold, or more, within multiple veins traced for an
aggregate strike length of 9.0 kilometres. The potential quantity and grade is
conceptual in nature. There has been insufficient exploration to define a
mineral resource. It is uncertain if further exploration will result in
discovery of a mineral resource.

    Recent Exploration History

    To date, St. Elias has identified five gold-bearing zones (Zona Canchete,
Zona Central, Zona Sur, Zona Incognito and Zona Este) with more than 50 quartz
veins (collectively) having a total combined length of approximately 9.0
kilometres. A map showing the location of the zones within the Project can be
viewed at http://www.steliasmines.com/properties/PeruFig3.pdf.

    So far, the Company has carried out exploration work on only two of these
zones:

    Zona Canchete, where consistent high-grade bulk samples have been
extracted from ongoing underground exploration and development; and

    Zona Central, where a new high-grade vein system has been discovered.

    Zona Canchete consists of a number of narrow, east-west striking
gold-bearing quartz veins. To date, a total of 233.3 tonnes of bulk-sample
material averaging 0.98 Au (33.6 g/t Au) has been extracted from ongoing
underground exploration and development at the ZCV#1 Vein. This is from only
one of at least five gold-bearing quartz veins identified in this zone.

    At Zona Central, the Company has recently discovered the A-4 Vein System,
which comprises one to three veins. The A-4 Vein System is part of eight other
main veins (or vein swarms) with an aggregate length of approximately 3,000m,
within an area measuring 1,000m x 1,200m.

    Channel samples taken from the A-4 shaft include: 19.86oz/t Au (681.0 g/t
Au) over 37cm taken from the 10m level (with a duplicate check sample assaying
17.2 oz/t Au (591.0 g/t Au) over 37cm); 2.09 oz/t Au (71.6 g/t Au) over 1.0
metre taken from the 10m level; and 11.87 oz/t Au (407.0 g/t) over 25cm taken
from the 30m level. To date, 20 quartz-vein samples collected from the A-4
Vein System returned a weighted arithmetic average grade of 2.37 oz/t Au (81.3
g/t Au) across an average vein width of 30.4cm (about twice the average width
of the ZCV#1 Vein). It is important to note that the average grade does not
include the duplicate check sample (17.24 oz/t Au) and that there is often
more than one vein exposed at the levels sampled. In addition to gold
occurring in the quartz veins, it also occurs in ore-tenor concentrations in
adjacent rock units (andesite dyke, fault gouge and weakly-altered
granodiorite.)

    Mining and Exploration Plan

    The Company plans to expand existing operations at both Zona Canchete and
Zona Central by deepening the existing main shafts to 100m below surface;
drilling 5,000 metres of short (150m) holes; and establishing exploration
level intervals at 50-m spacing.

    The objective of the plan is to achieve a sustainable economic production
to support two to three years of production at a rate of 300 to 500 tonnes per
month while concurrently defining resources and reserves.

    It is not possible to define a significant quantity of proven and
probable reserves with diamond drilling alone (in a narrow vein system -- see
note(1) below). In addition to diamond drilling, St. Elias must carry out
underground exploration and development, as well as, establish a production
history in order to define reserves.

    (1) Historically, most of the major Canadian vein type gold mines
(including Red Lake, Val d'Or, Timmins, Bralorne, etc.) rarely had more than a
couple of years of reserves that would meet today's definitions set out in
National Instrument 43-101. They all started off as small producers and
gradually expanded their production as reserves expanded.

    Development activities at Zona Canchete and Zona Central will be guided
by diamond drilling of approximately 5,000 metres of short diamond drill holes
from surface. Initially 4 or 5 strategically placed holes will be drilled on
each system to guide shaft deepening (to 100m) and level development (at 50-m
intervals). Subsequent systematic drilling (surface and underground) of both
vein systems will follow in order to delineate resources and reserves for
mining. Shallow surface drilling is planned to test the veins with drill holes
having a maximum length of 150 metres spaced at approximately 30-mcentres.
Surface drilling is needed to plan mine development which in turn will permit
detailed underground drilling to be undertaken to define stope geometries and
grades for mining purposes.

    Level intervals will be increased from the present 20-m spacing to 50-m
increments. Establishing levels at 50-m intervals significantly reduces level
development costs and increases stope life which will result in increased
productivity and profitability. Spacing the levels at 50-m intervals allows a
design to exploit "significantly large" stoping blocks that can support a
predictable production rate for an extended period of time.

    The Company has been able to secure and purchase its own diamond drill
and related equipment which is presently being prepared for shipping to Peru.
Management has concluded that Company ownership of its own diamond drill will
substantially expedite St. Elias' drill programs and provide significant
savings in drilling costs.

    The technical content of this news release, has been verified by, John
Brophy, P.Geo., and Glenn O'Gorman, P.Eng., who are independent qualified
persons as defined in National Instrument 43-101, Standards of Disclosure for
Mineral Properties.

    For additional information on St. Elias and its projects, please visit us
at www.steliasmines.com or call 1-888-895-5522 (toll free US and Canada).

    ST. ELIAS MINES LTD.

    (signed "Lori McClenahan")

    Lori McClenahan,

    President

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

    This News Release may contain forward-looking statements including, but
not limited to, comments regarding the timing and content of upcoming work
programs, geological interpretations, potential mineral recovery processes,
etc. Forward-looking statements address future events and conditions and
therefore involve inherent risks and uncertainties. Actual results may differ
materially from those currently anticipated in such statements

For further information: St. Elias Mines Ltd. Lori McClenahan Telephone:
604-669-4677 Facsimile: 604-669-9626 Toll Free: 888-895-5522 Web Site:
www.steliasmines.com

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