Trading Symbol: SLI (TSX Venture Exchange)

EKL (Frankfurt Exchange)

SELSF (U.S. Clearing Symbol)

News Release 2012-13

May 24, 2012

NEWS RELEASE

St. Elias Mines Ltd. – Diamond Drilling Update - Tesoro Gold Project in Peru

Vancouver, B.C. May 24, 2012 Lori McClenahan, President and CEO of St. Elias Mines Ltd. (SLI - TSX:V) today announced the results of drill holes TE-12 to TE-35 at the Tesoro Gold Project, located in southwestern Peru. Forty-three Diamond drill holes, totaling 12,740 metres, have been completed to date. Assays are pending for holes TE-36 to TE-40. Samples from drill-holes TE-41 to TE-43 are being prepared for shipment to the CERTIMIN analytical laboratory in Lima.

To date the drilling has tested a variety of targets including:

-          Titan 24 geophysical targets (including chargeability highs, resistivity lows, and gradients);

-          Down-dip and along- strike extensions of known gold- bearing quartz veins;

-          Coincident geophysical and geological targets.

Drilling to date has not explained the causative sources of the geophysical anomalies reported by Quantec. The Quantec data and interpretations are being independently examined by Canadian geophysicists.

Despite the inconclusive results from the drill holes that specifically targeted the geophysical anomalies reported by Quantec, drill holes that tested geological targets intersected gold at depths. Examples of drill holes with relatively deep intersections include DDH TE-14 (7.08 g/t Au at a true depth of 276m) and DDH TE-29 (6.08 g/t Au at 275m true depth). Management is currently planning and preparing a program of underground exploration and bulk sampling of the gold-bearing structures intersected during the surface drilling program. This strategy is consistent with the old gold mining rule of thumb, “drill for structure and drift for grade”. This old adage is pertinent even today, because the distribution of gold in many vein systems is erratic, and high grade gold often occurs only in steeply-plunging “shoots” in the plane of the vein.

The following two tables present the Tesoro drill intercepts greater than 1.0 g/t (Table 1) and the drill intercepts grading between 0.5 and 1.0 g/t (Table 2). Please note that the Table 1 intercepts are distinct and separate from the intercepts presented in Table 2.

The gold assays in Tables 1 and 2 above are uncut, and the stated intercept widths are apparent widths measured parallel to the core axes. The true widths of the structures intersected may be equal to or less than the apparent widths stated in the Tables.

A drill hole location map is available on the following link: http://steliasmines.com/wordpress2/wp-content/images/SLI_Tesoro_Drill_Hole_Location_Map_May_2012.pdf

At the end of May, the Company will temporarily suspend drilling at the Tesoro project, pending the receipt of the independent evaluations of the existing geophysical data, completion of a formal compilation of all available historic, geochemical, geological and structural data, and detailed geological mapping covering a number of historic mine areas. Planning and preparation are underway for a program of underground exploration and bulk sampling. One of the key objectives of this program is to compare the grades and widths of structures intersected by the drill holes with the much higher-quality data obtained by bulk sampling the same structures underground.

The drilling program ran smoothly and without interruption, and was completed within the forecast cost parameters. Management is extremely pleased with the professional manner in which Energold Drilling Peru S.A.C. conducted and supported the program.

The Company utilizes an industry-standard QA/QC (quality assurance/quality control) program. The HQ and NTW-diameter Diamond drill core is sawn in half longitudinally, and one half is shipped to the ISO-certified CERTIMIN S.A. analytical laboratory in Lima for gold fire assay and ICP-MS analysis. To monitor laboratory performance, blanks, duplicates and certified reference standards are inserted at random into the sample stream at the rate of 1 of each type per 30 to 50 core samples.

Tesoro Gold Project

The Tesoro gold project is 100 per cent owned by the Company with no underlying royalties. The property covers approximately 6,974 hectares (17,436 acres) and lies within the 300 km by 30 km Nazca-Ocona gold province, which trends northwest parallel to the Pacific coastline. The Nazca-Ocona gold belt has a long mining history dating from pre-Incan time. Gold is associated with disseminated sulphides in quartz veins and vein-faults within the Coast intrusive complex. The Nazca-Ocona belt is noted for the strike continuity of many of its quartz vein systems and associated faults. While the veins are often narrow (less than one metre), their gold grades can be high, especially in localized “shoots” that occur where the vein geometries change.

The Company has identified five mineralized zones the Tesoro project that host more than 50 quartz veins. Underground exploration and development work has been carried out on three of these veins (C1, C2 and A4 veins). To date, a total of 1,157 tons of bulk sample material averaging 0.93 ounce per ton gold has been extracted from the underground exploration and development workings at several locations including:

• 643 tons averaging 0.77 ounce per ton gold from the A4 vein;
• 451 tons averaging 0.99 ounce per ton gold from the C1 vein;
• 63 tons averaging 2.04 ounces per ton gold from the C2 vein.

Certain areas of the Tesoro property have been carefully prospected and explored by geophysical surveys, trenches and widely-spaced drill holes, but much of the property remains unexplored except for reconnaissance prospecting. . Most of the north, east and south sectors have never been geologically mapped, prospected in detail, trenched, or drilled. Further, large areas (up to 20-30 square km) of the prospective granitic rocks in the north-central and southeastern areas of the property are covered by late-Tertiary ash flows and crystal tuffs. These young, flat-lying volcanic units are several metres to tens of metres thick and completely obscure the prospective rocks of the Coast plutonic complex. Zones where strike extensions of known gold-bearing structures are extrapolated to pass under the volcanic cover are targets for geophysical exploration and drilling.

The technical contents of this news release have been verified by George Sivertz, P. Geo, a Canadian geologist and a part-time resident of Peru. Mr. Sivertz is a Qualified Person as defined in National Instrument 43-101 (Standards of Disclosure for Mineral Projects).

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) or contact:

U.S. Investor Relations Consultant

Herbert Haft
The Haft Group, Inc.

Tel: (212) 759-8865

Email: herbhaft@haftgroupinc.com

herbhaft@aol.com

ST. ELIAS MINES LTD.

(signed “Lori McClenahan”)

 Lori McClenahan,

President

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

 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 statement