Premium Exploration: Letter From The President

Dear shareholder,

Your Company continues to operate in a conservative mode waiting for a market turn-around and for exploration dollars to become available again.

Over the last few months, we have made progress on many fronts which add to our successful programs and will allow us to jump-start your Company into the forefront of market recovery.

We have streamlined operations and continue to maximize exploration success with the dollars invested. While the world faces the current global economic downturn, a functioning exploration and geological environment has developed with an abundance of geologists and drills available.  We look forward to 2009, where operating with geological infrastructure will expedite progress on your property packages.

Chrome Mountain – PGM

Drill results have started to trickle in from the 2008 Phase II, nine-hole drill program. Assaying is slow due the complicated nature of the platinum group metals and the effects of the chromitite.

The drill program was designed to advance what is considered a potential North American equivalent to important world-class deposits, found only in the Bushveld Complex of South Africa. It targeted the newly discovered UG2-Platreef mineralization while simultaneously looking for a high-grade feeder zone. The high-grade feeder zone in our magma-vent theory is thought to be the source of our Chrome Mountain anomaly. The soil sampling conducted to the west of the anomaly was also successful and will result in an increased strike length of the anomaly.

Assay results will be released once they are all received and interpreted.

Our joint venture partner, Beartooth Platinum Corp. is merging with another exploration company, Kria Resources. After meeting with the President and CEO of Kria, we are favorably inclined toward the new team. We are positive and encouraged about the joint venture matters which are in the process of being resolved and will move forward in 2009.

Idaho – Gold

Drill permitting is progressing at Buffalo Gulch. Permitting is in place for both the exploration program and ground monitoring wells surrounding the open pit and leach pad. The new wells add to the 17 existing sites already monitored.

The exploration target at Buffalo Gulch is the high-grade theory demonstrated at the south of the Orogrande Shear Zone where the high-grade structure has been identified.  The high-grade structure is a part of the 531,000 oz gold (NI 43-101) Petsite-Friday resource. The theory suggests potential high-grade mineralization along the entire strike length of the 28 km shear zone, confirmed by geophysics and geochemistry.

The remodeling of the ore bodies using new technology, Gemcom software, is also underway and will increase ounces at these projects.

Mexico – Silver and Gold

The drill program completed on the Nueva Galicia project indicates the ability to drill a resource of high-grade silver and gold mineralization, along the 11 km strike, of the three parallel vein systems. New work, including remote sensing, geophysics, mapping and sampling, indicate the possibility of other structures.

A three-hole drill program is set to confirm grades at the San Pedro Analco project before a decision is made to restart production on the historic past-producer.

Court work on an estate within the Lupe project in Durango is finished. Title has concluded so property evaluation can continue with trenching, mapping, and sampling to identify drill targets for the next exploration program.

Looking forward to 2009

With decreased compensation and some salaries suspended, your team is still fully committed to the success of your Company and continues to advance both projects and marketability. Your Company is positioned to come out ahead of this market downturn and will lead the pack.

We thank our shareholders and supporters for their patience and support.

Sincerely,

Del Steiner
President and CEO
Premium Exploration, Inc.

Please feel to contact us with any questions or feedback that you may have at the contact information listed below:

Mr. Del Steiner
President and CEO

(604) 682-0243
(604) 682-2499
(877) 608-0243
e: dsteiner@premiumexploration.com
w: http://www.premiumex...

Christine Kopr
Corporate Communications

(604) 682-0243
(604) 682-2499
(877) 682-0243
e: ckopr@premiumexploration.com
w: www.premiumexplorati...

About Premium Exploration, Inc.

Premium Exploration, Inc. is a unique precious metals explorer focused on Mexico and the USA.  Listed on the TSX Venture Exchange (TSX-V:PEM), the Company was founded on a team with exploration success, committed to maximizing shareholder exposure to precious metal discovery, the most profitable stage of exploration. Premium’s portfolio holds gold, silver and platinum group metals projects in various stages of exploration, from grassroots to near-term production.  Premium’s business model utilizes the joint venture model where strategically chosen projects are quickly advanced. This approach allows the Company to focus its exploration efforts in under-explored precious metal belts that would allow for profitable extraction, with minimal political, social or environmental risks. www.premiumexplorati....

All prospective and current shareholders of Premium Exploration are invited to join the company’s official investment forum exclusively at Pinnacle Digest: http://www.pinnacled.... The forum allows for investor controlled discussion, questions and progressive feedback from other shareholders and investors. Third party reports on the company are also available at http://www.pinnacled...