Jan 31, 2011 08:30 ET

Premium Exploration Drills 1.5 g/t Gold over 134 Meters Including 2.5 g/t Gold over 47.3 Meters; Resource Remains Open in All Directions and Phase-Four Exploration Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 31, 2011) - Premium Exploration Inc. (TSX VENTURE:PEM) ("Premium" or "the Company") is pleased to announce drill results from drill holes PFR2010_23 & 24. Both drill holes are located in the Main Zone and have advanced the Upper and Lower Blocks. Premium continues to encounter gold mineralization in 100% of drilling in the 10,000 meter Phase-Three program at the Friday-Petsite Gold Project in Central Idaho, USA.

"The focus of the Phase-Three program was to double the down-dip extent of the current Upper Block inferred resource to a vertical depth of approximately 300 meters and march along strike, essentially doubling the Main Zone footprint. With that achieved we are looking forward to the updated resource estimate and continued strike length development beyond the known zones of mineralization at Friday-Petsite resource," stated Michael Ostenson, VP Exploration.

"Phase-Three developed a proven exploration strategy at the Friday Project with the discovery of the Monday Fault mineralization. We look forward to applying the strategy to the balance of the OSZ to make new discoveries."

The Upper Block hosts an Inferred Resource comprised of 15 Mt at 1.1 g/t Au for 549,000 contained ounces at a 0.5 g/t Au lower cut-off. Drilling in Phase-Three has successfully increased the Lower Block strike length from 100 to 500 meters and the deposit remains open along strike and at depth.

PFR2010_23 is an infill hole located in the center of the Main Zone and was drilled west at a -72 dip further confirming the structural geometry and continuity of mineralization along strike between previously released drill-holes PFR2009_10 and PFR2009_12 (see previous releases dated January 13, 2010). It extends mineralization 180 meters below the current block model depth of 150 meters for a total mineralized vertical depth of 330 meters. The hole was completed at 389.5 metres down-hole depth and terminated in anomalous mineralization. For the cross section, please click: http://bit.ly/SectionPFR2010_23.

PFR2010_24 is located in the southern end of the Main Zone and was drilled west at a -80 dip providing structural information about the interpreted Quartz Creek Fault and the Lower Block mineralization. The hole was completed at a 342.3 meter down-hole depth. For the cross section, please click: http://bit.ly/gskND4.

Upper Block continuity of mineralization is confirmed although Lower Block mineralization is interpreted to be offset to the east by the Quartz Creek Fault. Correlating gold-in-soil and geophysics suggest potential continuity of 2.5 km south of the Quartz Creek Fault and will be a priority target in the upcoming Phase-Four drill program in 2011. For a map of Friday Fault Potential Continuity, please click http://bit.ly/PEMFridayFault.

For the Phase-Three Drill Plan, please click: http://bit.ly/PEMPhase3DrillResults and for the Updated Long Section, please click: http://bit.ly/eYmb1Z.

Drill Sections and a 3D model can also be viewed at Corebox at http://bit.ly/CoreboxFP3DModel, or by following a link on the Company's website at http://bit.ly/FridayPetsiteProject.

Phase-Four Exploration Update

Planning of the +25,000 meter Phase-Four drill program is underway and will be announced upon receipt of the 4,500 soil samples taken in the Deadwood Project. The gold–in-soil data will be correlated with the airborne geophysics, refining the most outstanding drill targets. In the preparation of Phase-Four, West Core Drilling out of Elko, Nevada, has been contracted to provide four drills with two scheduled to start drilling on March 21st, 2010.

Several exciting geophysical anomalies have been identified in the Deadwood Project and Premium's strategy is to apply its gold-in-soil and geophysical correlating methodology in its goal of making another new discovery in 2011.

The Friday-Petsite Project will also be advanced, following up on the new gold discovery in drill-hole PFR2010_19 along the west side of the shear zone known as the Monday Fault. The Company will also continue to develop the existing deposit along the eastern side of the shear zone known as the Friday Fault, which remains open along strike and at depth.

Quality Assurance

The Company has implemented a rigorous QA/QC program using best industry practices at the Friday-Petsite Property. As described in the Company's News Releases of July 9th, 2009 and December 29th, 2009 the program includes chain of custody of samples, drill core sawn in half and shipped in sealed bags, blind duplicates, blank samples and certified standards are inserted in the sample stream. The samples are then boxed and couriered to Acme Analytical Laboratories of Vancouver, B.C. a lab certified for the provision of assays and geochemical analyses (ISO 9001:2008). In Phase-Three, as with Phase-Two and Phase-One, samples with gold values greater than 10 g/t are re-analyzed via the metallic screen procedure. Samples with visible gold were also analyzed initially using the metallic screen analysis, as were the samples immediately preceding and following the sample with visible gold.

Qualified Person

The 2010 Phase-Three exploration program is being directed by Michael Ostenson, P.Geo., VP Exploration of Premium Exploration Inc. Mr. Ostenson is a Qualified Person as defined by NI 43-101. Mr. Ostenson prepared, and approves of the content in this release.

About Premium Exploration Inc.

Premium is focused on the exploration and development of its district-sized Orogrande Shear Zone "OSZ" to fulfill its vision of developing a new mining district in North America. The OSZ is a 30 km-plus regionally-significant trending structure that correlates with multiple known zones of mineralization and has structural control to its gold mineralization, characteristics similar to many large gold belts, such as the Carlin Trend of Nevada. Development is ongoing at the bulk-tonnage Friday-Petsite Project, the most advanced of several known mineralized zones located along the OSZ and represents 4% of the OSZ under Premium's control. For additional information, please visit us at www.premiumexploration.com.

This press release contains certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Security Exchange Act of 1934, and involves a number of risks and uncertainties. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents filed from time to time with the TSX Venture Exchange and the British Columbia Securities Commission. All statements, other than of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.

For more information, please contact

Premium Exploration Inc.
Mr. Del Steiner
President & Chief Executive Officer
(604) 682-0243
(604) 682-2499 (FAX)
[email protected], [email protected]
www.premiumexploration.com
or
Opes Capital Inc.
Ms. Christine Kopr
Corporate Communications
(604) 682-0243
(604) 682-2499 (FAX)
[email protected]
www.opescapitalinc.com