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American Mining Corp. Signs LOI to Form Production Joint Venture on Terra Gold Project in Alaska

American Mining Corp. has signed a binding letter of intent to enter into a joint venture with International Tower Hill Mines Ltd., in respect of ITH’s high-grade Terra Gold Project in Alaska. Pursuant to the letter of intent, Terra Gold Corp., an Alaskan subsidiary of AMC and Raven Gold Alaska Inc., a subsidiary of ITH, will form a joint venture (JV) with the aim of bringing the Terra Project into production. It is anticipated that AMC, as operator, will commence a project development program in June 2010.    

The Terra Gold Project is located in the Hartman Mining District of Western Alaska and consists of 235 State of Alaska unpatented lode mining claims currently held 100% by ITH plus an additional five unpatented lode mining claims held by ITH under lease (subject to an NSR royalty in favor of the lesser ranging from 0.5% and 5%, dependent upon the price of gold). The property is centered on an 8-km-long trend of high-grade vein occurrences that have returned numerous surface rock samples and drill intersections in excess of 50 g/t gold. The bulk of ITH’s past drilling has focused exclusively on a 400-m-long section of one of the vein systems (Ben’s Vein) discovered to date. An inferred resource estimate, based on 20 HQ diamond drill holes, is published in a National Instrument 43-101 technical report entitled, “Summary Report on the Terra Gold Project, Hartman District, Alaska,” dated February 1, 2008, prepared by Paul Klipfel Ph.D. of Mineral Resource Services Inc. on behalf of ITH. A copy of the report is available on the ITH website at www.ithmines.com and on the SEDAR website at www.sedar.com.

The initial participating interests of Terra and Raven in the JV will be 51% and 49%, respectively. Under the earn-in formula, Terra may acquire up to an undivided 80% interest in the Terra Project over four years by spending an aggregate of US $9.5 million in exploration expenditures, paying ITH US $450,000 in option payments and issuing ITH one million AMC common shares.

Formation of the JV is subject to the negotiation and execution of a definitive joint venture agreement and the completion by AMC of due diligence on the Terra Project, both of which must be completed on or before May 19, 2010 (subject to extension by agreement). “The joint venture with ITH will significantly benefit AMC shareholders by advancing the Terra Project into production,” said Greg Schifrin, president of AMC. “We believe the Terra Project, previously held by Anglogold Ashanti (USA) Exploration Inc. and Kennecott (a subsidiary of Rio Tinto plc), possesses a significant upside potential to increase the resource estimate in the additional veins, as well the potential for a bulk mineable large tonnage intrusive deposit.”

James Baughman, P.Geo, chief operating officer of the company, a qualified person as defined by National Instrument 43-101, supervised the preparation of the technical information in this news release.

American Mining Corp. is a privately held mineral exploration and development company that acquires, explores and, if warranted, develops advanced stage properties. The company’s objective is to be a leader in the exploration and development of base and precious metal resource properties in the U.S. Its goal is to elevate standards of responsible mining practices for the resource industry while maximizing shareholder value. The company intends to pursue a listing on the TSX Venture Exchange by way of an initial public offering (IPO) during the second quarter or early third quarter of 2010. In advance of the proposed IPO, AMC is working to complete a private placement offering of up to US $10 million to sophisticated and accredited investors, the proceeds of which will be used to fund the acquisition and development of the Terra Project and for general administration and working capital purposes. The company’s application to list on the TSX Venture Exchange is subject to the company meeting the Exchange’s minimum listing requirements and the discretion of the Exchange. There is no assurance that the company’s application will be approved by the Exchange on terms acceptable to the company, if at all. For more information, visit www.americanminingcorp.com.

International Tower Hill Mines Ltd. is a resource exploration company, focused in Alaska and Nevada, which controls a number of exploration projects representing a spectrum of early stage to its advanced multimillion ounce gold discovery at Livengood. For more information regarding ITH and the Terra Gold Project, visit www.ithmines.com.

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