Timberline Resources Corp (fka TLRS)

[Picassa]

Timberline Resources Corporation (TSX-V: TBR.V - News)(AMEX: TLR - News) ("Timberline" or the "Company") announced today that the application for the required water discharge permit (MPDES Permit) for the Butte Highlands Joint Venture Gold Project has been submitted to the Montana Department of Environmental Quality.

All sources of wastewater discharge, such as mine de-watering, are required to obtain and comply with MPDES permits. The goal of the Montana Pollutant Discharge Elimination System (MPDES) program is to control point source discharges of wastewater such that water quality in state surface water is protected. The application for the Butte Highlands Hard Rock Operating Permit, which includes a significant amount of information generated for inclusion in the MPDES Permit application, will be submitted shortly. Based on currently available timelines, Timberline anticipates the issuance of the required permits and the commencement of gold production at Butte Highlands in 2012.

Timberline was notified of the submission by its joint venture partner at Butte Highlands, Highland Mining. Timberline's unique partnership at Butte Highlands calls for its retention of a 50-percent project interest while being carried to production by Highland Mining. Once in production, Timberline is to receive 20-percent of project cash flow until Highland recovers its initial capital expenditures, at which time Timberline will receive 50-percent of cash flow.

Mine development and mining operations at Butte Highlands have been sub-contracted to Small Mine Development ("SMD"), an experienced underground mine operator which has performed mine development and mining operations for some of the largest mining companies in North America, including Newmont Mining and Barrick Gold. As announced previously, the initial mine plan at Butte Highlands will target production of approximately 400 to 500 tons per day for the first four years of operation with material direct shipped to a nearby mill.

In 2011, Timberline completed a 50,000-foot (15,240-metre) underground drill program which returned intercepts of up to 14.5 feet (4.4 metres) grading 6.77 ounces of gold per ton (231.85 grams per metric tonne). SMD has completed over 4,000 feet (1.2 kilometres) of underground development and completed construction of all surface facilities for the project. The Butte Highlands Joint Venture is located within a favorable geologic domain that has hosted several multi-million ounce gold deposits including Butte, Golden Sunlight, Montana Tunnels, and Virginia City.