Pele Mountain Drilling Expands Eco Ridge Deposit Northward, Demonstrates Significant Rare Earth Mineralization Outside of Main Conglomerate Bed

Toronto (ots/PRNewswire) -

Trading Symbol: TSX Venture : GEM
OTCQX : GOLDF
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Pele Mountain Resources Inc. (OTCQX: GOLDF) ("Pele" or the
"Company") today announced results from the recent 7,000-metre drill
program at its Eco Ridge Mine Rare Earths and Uranium Project ("Eco
Ridge" or the "Project") in Elliot Lake, Ontario.

Core from 23 intercepts of the Main Conglomerate Bed ("MCB") (of
24 holes drilled) from June to July 2011 returned results typical of
the Eco Ridge deposit, averaging 0.142-percent rare earth oxides
("REO") and 0.040-percent uranium oxide ("U3O8") over an estimated
true thickness of 3.16 metres. The 2011 drill program included four
step-out holes, each more than 200 metres down-dip of the existing
resource, revealing that the deposit continues to the north into a
previously untested area. The program also included 20 infill holes
drilled within the existing resource in order to upgrade Inferred
resources to Indicated resources. The program again demonstrated the
remarkable consistency of the MCB over vast areas. The Eco Ridge MCB,
hosted by the quartzitic Ryan Member, is a shallow dipping reef that
has now been successfully drill-tested across an east-west strike
length of more than 5 kilometres and a north-south dip extension of 2
kilometres.

The table below summarizes the MCB intercepts from Pele's 2011
drill program at Eco Ridge. To view complete assay results, please
click here
http://www.pelemountain.com/pdfs/DrillResultsAugust2011.pdf

From Core Estimated True Total REO U3O8
Hole ID (m) Length (m) Width (m) (%) (%)
PM190 450.60 5.13 4.36 0.022 0.042
PM191 247.20 4.30 3.54 0.163 0.035
PM192 238.72 3.96 3.39 0.156 0.042
PM193b 563.74 3.19 3.10 0.186 0.057
PM194 235.17 3.11 2.67 0.192 0.048
PM195 310.88 3.27 3.23 0.168 0.047
PM197 339.92 4.24 3.44 0.155 0.045
PM198 627.17 3.41 3.40 0.151 0.052
PM199 160.86 2.48 2.39 0.215 0.040
PM200 180.60 4.12 3.83 0.019 0.035
PM201 164.70 3.14 3.06 0.157 0.037
PM202 217.76 3.29 2.81 0.152 0.040
PM203 432.52 3.03 2.59 0.129 0.028
PM204 214.05 4.14 3.84 0.127 0.030
PM205 174.55 3.89 3.73 0.137 0.028
PM206 289.84 2.96 2.90 0.125 0.042
PM207 172.49 3.44 3.42 0.151 0.032
PM208 286.07 3.21 2.99 0.150 0.051
PM209 165.98 3.20 3.13 0.165 0.035
PM210 122.69 2.67 2.62 0.147 0.028
PM211 235.83 4.02 3.11 0.138 0.044
PM212 118.24 2.92 2.85 0.174 0.044
PM213 141.00 2.47 2.16 0.204 0.048

Notes:

1) Light rare earth oxide (LREO) includes La2O3, CeO2, Pr6O11,
Nd2O3, Sm2O3
2) Heavy rare earth oxide (HREO) includes Eu2O3, Gd2O3, Tb4O7,
Dy2O3, Ho2O3, Er2O3, Tm2O3, Yb2O3, and Lu2O3. Y2O3 and Sc2O3 are also
included in HREO
3) Total rare earth oxides include LREO and HREO.

The drill program also demonstrated the presence of widespread
rare earth mineralization outside the MCB. All mineral resources
reported at Eco Ridge to-date are from within the MCB only. The
presence of wide zones of REO mineralization outside of the MCB has
the potential to substantially increase mineral resources and
positively impact project economics at Eco Ridge.

Pele President and CEO Al Shefsky stated, "For five years, we
have worked to unlock the REO potential at Eco Ridge. Given the
production history of Elliot Lake, where REO were produced as
by-products of primary uranium mines, our approach until recently has
been to follow this precedent. However, with the repricing of REO and
the prospect for long-term shortages of certain critical REO, we are
taking a fresh look at Eco Ridge and its potential as a primary REO
mine. Results from our recent drill program suggest that there is
excellent potential to demonstrate additional REO content in areas we
have already drilled, possibly improving upon the already promising
economic forecast presented in our Prelimary Economic Assessment. We
have securely stored all of the more than 37 kilometres of our
previously-drilled core and have assembled an experienced technical
team, including RPA, to implement this program. We are very excited
about our expanded core sampling program at Eco Ridge."

Core sampling outside of the MCB was not comprehensive because
sampling limits have historically been determined by focusing on
optimizing the U3O8 mineralization, not REO mineralization. In view
of the increasing importance of rare earths, and the fact that there
is more than 3 times as much REO as U3O8 at Eco Ridge, Pele is
assessing changes to this legacy practice.

Comparisons that follow are relative to the average grade and
thickness of the Indicated Resources at Eco Ridge ("Ind-MCB") as
estimated by Roscoe Postle Associates ("RPA"). The Ind-MCB is
0.164-percent Total REO and 0.048-percent U3O8 over a 2.7 metre true
thickness.

Drill core from the hanging wall above the MCB returned assays
ranging from 0.056-percent Total REO (34-percent of Ind-MCB grade)
over a 0.45 metre true thickness (Hole PM191) to 0.096-percent Total
REO (59-percent of Ind-MCB grade) over a 10.04 metre true thickness
(Hole PM193). Overall, the hanging wall samples averaged nearly
50-percent of Ind-MCB grades for Total REO and more than 20-percent
of Ind-MCB grade for U3O8 with all samples ending in mineralization.
Limited sampling of drill core taken directly below the Ryan Member
demonstrates REO presence within Basement meta volcanics at similar
grades over sampled widths of less than 1 metre, with all sampling
ending in mineralization.

These results clearly demonstrate the presence of significant REO
mineralization outside of the MCB and have prompted Pele to launch a
staged program designed to expand the sampling range of recent and
historic Pele drill core. The program has begun with expanded
sampling on 14 holes from across the deposit including the MCB
hanging wall from Hole PM07-14 from Pele's 2007 drilling at Eco
Ridge.

Assays from Drill Hole PM07-14 (from 2007)

From True Width Total REO U3O8
Layer (m) (m) (%) (%)
MCB Hanging Wall 70.93 10.48 0.080 0.010
MCB* 82.48 3.24 0.223 0.056
Combined Total 70.93 13.72 0.114 0.021

* reported previously

For Hole PM07-14, the sampled portion of the MCB hanging wall
averaged approximately 49-percent of Ind-MCB grades for REO and
approximately 21-percent of Ind-MCB grades for U3O8 over a total
thickness 5 times wider than the Ind-MCB, representing a substantial
increase in total mineralization.

The objective of Pele's expanded core sampling program is to
evaluate the vertical extent of REO mineralization at Eco Ridge. Core
sampling in the Elliot Lake camp has historically been designed for
testing the limits of the U3O8 mineralization and not REO
mineralization. Accordingly, the program now underway will
systematically test considerable wall rock above and below the MCB to
determine the extent of the REO mineralization for the first time. As
reported with the Eco Ridge Preliminary Economic Assessment[1]
("PEA"), RPA regards the expansion of mineral resources as a
potential opportunity to improve project economics at Eco Ridge.

Based on oxide price and recovery assumptions detailed in the
PEA, forecast revenue at Eco Ridge now consists of 61-percent from
U3O8 and 39-percent from REO. Approximately 59-percent of the REO
revenue component is forecast from just three REO: dysprosium
("Dy2O3"), neodymium ("Nd2O3"), and yttrium ("Y2O3"). Drill results
for U3O8 and these "big three" REO are reported in the table below.

From Core Estimated True Dy2O3 Nd2O3 Y2O3
Hole ID (m) Length (m) Width (m) (g/t) (g/t) (g/t)
PM190 450.60 5.13 4.36 11 28 50
PM191 247.20 4.30 3.54 15 244 70
PM192 238.72 3.96 3.39 16 238 74
PM193b 563.74 3.19 3.10 21 264 87
PM194 235.17 3.11 2.67 19 265 93
PM195 310.88 3.27 3.23 17 230 81
PM197 339.92 4.24 3.44 15 215 69
PM198 627.17 3.41 3.40 16 216 74
PM199 160.86 2.48 2.39 18 308 87
PM200 180.60 4.12 3.83 9 26 51
PM201 164.70 3.14 3.06 16 226 74
PM202 217.76 3.29 2.81 15 224 74
PM203 432.52 3.03 2.59 12 191 55
PM204 214.05 4.14 3.84 13 185 62
PM205 174.55 3.89 3.73 13 201 60
PM206 289.84 2.96 2.90 14 182 61
PM207 172.49 3.44 3.42 15 220 67
PM208 286.07 3.21 2.99 17 217 74
PM209 165.98 3.20 3.13 16 242 70
PM210 122.69 2.67 2.62 14 207 63
PM211 235.83 4.02 3.11 14 196 63
PM212 118.24 2.92 2.85 18 241 81
PM213 141.00 2.47 2.16 22 284 98

Pele's Eco Ridge PEA, prepared by RPA, and based solely on the
mineralization within the MCB, demonstrates Pele's potential to
become a profitable producer of REO and U3O8. The PEA base case
forecasts cumulative production of 10.7-million pounds of Total REO
and 24.9-million pounds of U3O8 over a 15-year mine life with pre-tax
cash flow of US$1.28-billion, a positive NPV of $644-million (at a
7.5% discount rate), and an IRR of 45-percent.[1] Among aspiring
Canadian REO producers, Pele's forecast operating costs at Eco Ridge
are, by far, the lowest at just $46 per tonne. For more details on
the PEA, please see Pele's press release dated September 7, 2011
[http://www.pelemountain.com/news/090711 Pele Files PEA For Eco
Ridge-2.pdf ].

The Resource Wireframe at Eco Ridge currently contains
14.3-million tonnes of Indicated resources plus 33.1-million tonnes
of Inferred resources. The deposit extends to the north and east,
beyond the Resource Wireframe boundaries. Based on historical
wide-spaced drilling and extrapolation of the resource area, RPA has
estimated that these extensions could contain an additional 30 to 50
million tonnes grading from 0.03 to 0.05-percent U3O8 and 0.12 to
0.18-percent Total REO as a target for further exploration[2]. The
step-out holes reported today were drilled to the north of the
Resource Wireframe and outside of the boundaries of the target area.

Drill core samples were analyzed at Activation Laboratories Ltd.,
an independent and ISO 17025 accredited laboratory. The Company
performs routine Quality Assurance and Quality Control procedures on
laboratory assay results.

The technical information contained in this press release has
been reviewed and approved by Tudorel Ciuculescu, P.Geo of RPA, an
independent Qualified Person under NI 43-101.

About Pele Pele Mountain Resources, a leader in Canadian rare
earth development, is focused on the sustainable development of its
100-percent owned Eco Ridge Mine Rare Earths and Uranium Project. Eco
Ridge is one of very few North American rare earths deposits that has
a NI 43-101 Preliminary Economic Assessment with robust economics and
is located in Elliot Lake, the only Canadian mining camp to have ever
achieved commercial REO production. With well-understood geology,
mineralogy, and metallurgy, excellent regional infrastructure, and
strong local support, Eco Ridge is an ideal location for a safe,
secure, and reliable long-term supply of REO and U3O8. Pele also
holds interests in a portfolio of Northern Ontario gold properties at
Highland and Ardeen. Pele's shares are listed on the TSX Venture
Exchange under the symbol "GEM" and on the OTCQX under the symbol
"GOLDF".

1) The PEA is preliminary in nature. It includes inferred
mineral resources which are considered too speculative geologically to
have the economic considerations applied to them that would enable them
to be categorized as mineral reserves and there is no certainty that the
preliminary economic assessment will be realized.
2) The potential quantity and grade of the target area is
conceptual in nature and there has been insufficient exploration to
define a mineral resource and it is uncertain if further exploration
will result in the targets being delineated as a mineral resource.

Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this
release. Some of the statements contained in this release are
forward-looking statements, such as estimates and statements that
describe Pele's future plans, objectives or goals, including words to
the effect that Pele or management expects a stated condition or
result to occur. Since forward-looking statements address future
events and conditions, by their very nature, they involve inherent
risks and uncertainties. Actual results in each case could differ
materially from those currently anticipated in such statements. The
economic viability of the 43-101 mineral resource at Pele's Elliot
Lake Project has not yet been demonstrated by a preliminary
feasibility study.

For further information:

Al Shefsky, President, at +1-(800)-315-7353, or visit the Pele
website at http://www.pelemountain.com

ots Originaltext: Pele Mountain Resources Inc.
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