Klondike Star Advances Indian River Gold Project towards Mine Decision

    SEATTLE, August 30 /CNW/ - Hans Boge, P.Eng., President, Klondike Star
Mineral Corporation (OTCBB:KDSM) is pleased to report substantive progress on
regulatory approvals, current extensive drilling and test mining program,
delineation of probable mineral reserves, and business planning for a mine
development decision by the Board of Directors.

    Following regulatory and public assessment under the Yukon Environmental
and Socio-Economic Act, the Yukon government Department of Energy, Mines and
Resources has formally authorized the development and operation of an Indian
River placer mine by Klondike Star. This approval provides the direction to
regulatory agencies for the detailed water and mining land use permits
expected to be issued in the near future.

    Following two successive winter exploration drilling programs, Klondike
Star completed a third winter drilling program in March 2007 and mounted a
major auger drilling initiative after spring break-up in May. This accelerated
effort to delineate mineralized areas and assess probable reserves. Drill
lines were completed at 1000 foot intervals with holes 100 feet apart along
the drill lines spanning the complete width of the initial target zone.

    As of late July, a cumulative total of 551 holes 5,051 meters/16,565 feet
had been drilled on the property and gold recovery determined. Between
November 2006 and July 2007, 277 holes were completed totaling 1814
meters/5945 feet. Gold was recovered from close to 100% of the holes
continuing the pattern established with previous drilling results. The
drilling program has since shifted to infill drilling with drill lines at 500
foot intervals to facilitate detailed mine planning and increase confidence in
the assessment of whether there may be probable mineral reserves.

    To further calibrate drilling results, test mining operations started in
2006 using an industry-standard 5' trommel. One test site was completed in
2006 totaling 7249 cubic meters of material with positive results. As of
August, test mining is progressing on two more representative sites. Results
are expected to be available for release in September.

    Hans Boge, P.Eng., Klondike Star President stated, "The receipt of an
authorization to mine from the Government of Yukon, following the
environmental and socio-economic assessment by an independent agency, is a
major step forward. Along with the forthcoming report on probable mineral
reserves, this allows the company to finalize plans for a potential mine on
its Indian River property."

    A comprehensive business plan based on a 10-year minimum mine-life is
nearing completion. It will comply with the U.S. Securities and Exchange
Commission requirements for assessment and reporting of mineral reserves. The
plan providing the information necessary for a mine development decision is
expected to be considered by the Board of Directors within 45 days. Subject to
financing, this would allow for production to commence as early as 2008.

    About the Indian River Gold Project

    The Indian River property consists of 223 placer bench claims and 3
leases totaling about 21.1 km2/8.2 mi2 located in a wide, shallow valley about
40 kilometers from Dawson City, Yukon in the heart of the Klondike
gold-producing region. Klondike Star holds 100% ownership, with exception of a
49% interest in a small group of claims. The property has never been mined
using modern recovery methods.

    For more information please contact:

    The statements in the press release that relate to the company's
expectations with regard to the future impact on the company's results from
new products or actions in development are forward-looking statements, within
the meaning of the Private Securities Litigation Reform Act of 1995. The
statements in this document may also contain "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Since this information may contain
statements that involve risk and uncertainties and are subject to change at
any time, the company's actual results may differ materially from expected

For further information:

For further information: Klondike Star Mineral Corporation Wayne
Cousins, Investor Relations, 800-579-7580

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