Persian Gold: Update on the Chah-e-Zard Gold Project in Yazd, Iran


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* Very encouraging second stage sampling results.
* Drilling contract agreed.
* Drilling to commence in the coming weeks.

Persian Gold plc. ("Persian Gold" or "the Company") is very pleased to announce the results from the second stage sampling programme on the Chah-e-Zard Gold Project in Yazd, Iran. Persian Gold holds an option to acquire 70% of the project with the remainder held by a local Iranian company.

The first analyses from the current geochemical sampling programme on the gold deposit in Chah-e-Zard, near Yazd, have produced excellent results. 344 of 366 samples of the current rock chip/channel and soil data base have returned gold values.

These results have enabled the Board of Persian Gold to confirm a drilling contract with a Turkish drilling company with a long history of gold exploration. The Company intends to undertake a multi hole diamond drill programme to commence in early autumn.

John Teeling, Chairman commented

"These are good results and support the earlier results achieved by Persian Gold and the data supplied by our local partner. The size of the mineralised zone, at 750m x 1250m, is large and, if the upcoming drilling programme confirms previous rock and soil sampling data, there is a good possibility of advancing this project towards a new substantial gold discovery.

The project is attractive both geologically and logistically. Suitable for low cost heap leaching and workable all year round, this could be a very cost effective and profitable project"

Operational Detail

The detailed surface geochemical sampling programme underway is being conducted on a precise 50 by 50 metres sampling grid to define the outline of the deposit and to select drill targets. This programme is a follow up to the earlier reconnaissance rock chip programme undertaken in Q1 2006 which defined a large surface anomaly with gold values up to 21 g/t.

The rock chip and soil sample results have confirmed that gold mineralization at Chah-e-Zard, including a significant number of samples that grade better than 4.0g/t gold and multi-gram silver, occur across outcrops within an area measuring in excess of 1250m x 750m. The mineralisation relates to a variety of acid sulphate altered phreatic, phreatomagmatic and siliceous hydrothermal breccias.

The current defined target covers an area of 700,000m2 within which the following averaged rock chip/channel results are calculated using a 10.0g/t cut off for the higher grading samples:

* 184 rock samples within this target boundary average 0.94 g/t gold.
* 37% of rock samples grade better than 0.5g/t Au and average 2.30g/t gold.
* 12% samples grade better than 2.0g/t Au and average 4.9g/t gold.
* 7% samples grade better 4.0g/t and average 6.7g/t gold.

The forthcoming reconnaissance diamond drill holes at Chah-e-Zard aim to test the significance of the grade at depth and determine whether the gold grades hold up between outcrops. Soil results for samples covering the target area on approximately 50 metre indicate that there is a good probability that the gold mineralisation is continuous between outcrops.

The Chah-e-Zard target, located 350 miles southeast of Tehran, consists of a circular complex of multiple-stage breccias hosted in altered volcanics. Rock alteration at Chah-e Zard covering an area in excess of 3 x 3 km, relates to a large elliptical shaped collapse feature. Located at the edge of this feature, the Zard gold target is developed where the 'collapse feature' cuts a pre-existing intrusive dome complex. The alteration which extends around the remainder of the structure remains to be investigated in detail.

This area which is easily accessible all year round exhibits potential for a large gold resource. Initial indicators suggest that the deposit will be amenable to low cost heap leaching. The terrain is also suited to this process. The forthcoming drill program aims to test scope for a large scale bulk tonnage and heap leach gold target in tandem with on going surface exploration which it is hoped will better define limits to the mineralization.

This announcement has been approved by S.J. Meldrum, Geologist, Consultant to the Board, Calle Las Tres Marias 363-6, Monterrico, Surco, Lima, Peru.