Millstream Mines Ltd. Uncle Sam Montana Property

Date: August 7, 1997

Millstream Mines Ltd. would like to announce that it has commenced underground exploration drifting in the 49% optioned Uncle Sam Mine in Montana. This program is in compliance with the terms and agreements involved in securing 49% ownership of the Uncle Sam gold lode deposit.

 The work completed to date includes retimbering and refurbishing of the lower adit and excavation of 80 ft. of trackless drift which is being mucked with a 1 yard scoop-tram. Work continuing at present is advancing the above drift to reach virgin ground in the targeted hanging wall vein structure.

 Millstream intends to expose and channel sample the gold bearing structure to block out and determine proven reserves. Negotiations are ongoing to access a mill within trucking distance (11 miles).

The Property is located in the Tobacco Root Mountains, Madison County, Montana. Detailed geophysical, geochemical and geological surveys have extended the previous workings to cover a gold/graphite bearing structure over 8,000 feet long. The investigation has identified the presence of other lode gold occurrences associated with the known mineralized Uncle Sam fault zone. All previous mining has come within or at the Uncle Sam fault over a width of three (3) to ten (10) feet, which form a hanging wall structure that is part of a fault zone about sixty (60) feet in true thickness.

 Samples taken from the hanging wall (and previously released) in September of 1996 assayed at 36.2 grams (1.164 oz.) of gold and 82.7 grams (2.66 oz.) of silver per ton. Vein material assayed at 16.04 grams (0.516 oz.) of gold and 15.24 grams (0.49 oz.) of silver per ton with minor lead and zinc values.

 Millstream has 15,542,425 shares outstanding.

 The principle business of Millstream Mines Ltd. is to enhance and develop known mineral properties to production potential. Millstream holds mineral claims and interests, directly or through wholly owned subsidiaries, in the Czech Republic, USA and Canada.


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