Jinshan Gold Mines Inc. is pleased to announce that since July 31st, the CSH 217 Gold Mine in Inner Mongolia, China, has produced 4,130 ounces (117 kg) of gold dore.

A formal mine opening ceremony was held on August 18th with more than 200 distinguished guests in attendance, including senior government officials and representatives of the local county towns of Xinhure and Wulate. Also, attending the ceremony were employees of the mine, mining and construction contractors, and villagers and farmers from the nearby communities.

During the ceremony, Jinshan announced its commitment to continue to help fund education opportunities to qualified students in the local area. The company has now made a total commitment this year of RMB 300,000 (US $39,000) towards this effort.

The mine has performed well during this initial startup phase, and over the next few months the company expects to increase gold production to its designed rate of approximately 10,000 ounces per month. In addition, the company is advancing an engineering study to examine the potential for an increase in the mine's production from the current projected average of approximately 120,000 ounces of gold per year to approximately 180,000 ounces per year. The study is expected to be finalized towards the end of 2007.

Locals at Jinshan opening ceremony

Two drill rigs are currently at the mine drilling to test potential extensions of the CSH 217 deposit and also to upgrade some of the current inferred resources to measured and indicated categories. The current drill program is expected to total approximately 8,000 metres. A new resource estimate is anticipated in two stages, with results from the Southwest zone planned for later this year, and results from the remaining mineralized zones in early 2008.

Jinshan is in a solid financial position with the commencement of cash inflow from gold production, and a current treasury of approximately US $28 million held in cash and short-term deposits with the Bank of Montreal. Jinshan has no exposure to the current liquidity disruption of Canadian asset-backed securities issued by Coventree Capital Group Inc.

Dadiangou Drilling and Xinjiang Exploration

The Phase II drilling program at Jinshan's Dadiangou gold prospect has commenced. Phase I drilling identified a gold mineralized zone extending more that two kilometres in strike length. The objective of the 5,000-metre Phase II drilling campaign is to delineate extensions to the mineralized zone and to conduct infill drilling, so that a National Instrument 43-101 compliant resource can be completed for the property, with an anticipated completion date of the end of 2007. In addition, Phase II drilling will test new gold anomalies that were identified parallel, and to the north, of the existing mineralized zone. Approximately 1,000 metres of drilling has been completed and the first assay results are expected in a few weeks (see Jinshan press release April 11, 2007).

The company continues to advance its gold exploration projects in China's Xinjiang Province during the summer season. Crews at the Changsheng and Xingou gold prospects are completing surface mapping, sampling and trenching so that further follow up exploration, including possible drilling, can be initiated later this year.