The Bell Creek Mine property anchors Lake Shore Gold’s 32 square kilometre Bell Creek Complex. Of the total National Instrument (“NI”) 43-101 resources at Bell Creek Complex of 828,800 ounces in the measured and indicated categories and 1,122,600 ounces in the inferred category, 646,400 ounces of measured and indicated and 953,800 ounces of inferred are located at Bell Creek Mine, with the remainder representing the initial, shallow resources at the nearby Vogel/Schumacher and Marlhill properties. These properties, as well as others, primarily Wetmore, are the other key properties within the Bell Creek Complex land position, all of which have significant exploration potential.

History

1980 –1982 – A joint venture between Rosario and Dupont Canada Exploration discovered gold mineralization in the North A and Northeast zones of the property. The Bell Creek West Zone was discovered in 1989.

1986 – 1991 – Bell Creek Mine operated by Canamax Resources Inc.

1991 – 1994 – Falconbridge Gold operated Bell Creek Mine from 1991 to 1992, followed by Kinross until the mine’s closure in 1994.

1986 –1994 – Production during the period prior to the mine’s closure totaled 576,017 tons for 112,739 ounces (0.197 ounces per ton or approx. 5.57 grams per tonne). Production during this period mainly revolved around a three compartment timber shaft sunk to a depth of 280 metres. From the shaft, mine levels were developed to the ore zones, and a ramp was developed from the lowest mine level to access ore below the current shaft depth. The mine was serviced by the shaft with an 8-foot diametre double drum hoist, and includes a 30-metre high headframe with a 300 tonne coarse ore bin to a loadout facility.

January 2007 – Lake Shore Gold entered into an agreement with the Porcupine Joint Venture to acquire the Bell Creek mine and mill, with the transaction closing in December of that year. The Bell Creek Mine included a shaft, hoist, headframe, ore bin, collar house, hoist building, mine dry, office complex, underground mine workings and historic (non-NI 43-101 compliant mineral resources.

Highlights

March 30, 2012 – The Company announces more than a 150% increase in measured and indicated resources at Bell Creek Mine, to 646,400 ounces (4,249,000 tonnes grading 4.73 grams per tonne) with an additional 953,800 ounces (6,088,500 tonnes grading 4.87 grams per tonne) of inferred resources.

March 25, 2012 - The Company announces total production from Bell Creek Mine in 2011 of 24,602 ounces (178,676 tonnes grading 4.29 grams per tonne).

August 16, 2011 - Drilling extends mineralization at Bell Creek Mine 400 metres below current resource (to approximately 1600 metres from surface).

December 1, 2010 - Initial National Instrument 43-101 resources announced for Bell Creek Mine, totaling 1,790,000 tonnes grading 4.36 gpt for 251,200 ounces in the Measured and indicated categories, and 8,427,000 tonnes grading 4.40 gpt totaling 1,192,900 ounces in the Inferred category.

November 2, 2010 - Drill results at Bell Creek demonstrate potential for extreme high-grade core with intersections such as 106.46 gpt over 7.05m (including 2,870 gpt over 0.25m). First six holes drilled at Wetmore all intersect structure and grade, potential second mineralized trend at Bell Creek Complex identified.

Resources

On March 30, 2012, the Company announced an updated resource estimate for the Bell Creek Mine which includes 646,431 ounces in the measured an indicated categories (4,249,451 tonnes at an average grade of 4.73 grams per tonne) and 953,845 ounces in the inferred category (6,088,506 tonnes grading 4.87 grams per tonne). The updated resource estimate reflects the conversion of approximately 425,000 ounces of inferred resources from the previous resource estimate, released in the December 2010, to the measured and indicated categories, and the addition of approximately 185,000 ounces of new resources to the inferred category. The totals also reflect the impact of depletion due to mining and other activities since the previous resource estimate. The base case resource was estimated assuming a long term gold price of US$1,200 per ounce of gold and a cut off grade of 2.20 grams per tonne.

*Resource estimation completed using Inverse Distance to the power 2 (ID2) interpolation method with all gold assays capped to 34 gpt. The resource estimate includes approximately 1.1 million tonnes of internal dilution.

Included within the mineral resource estimate is a sensitivity analysis from the base case resource estimate using various cut off grades between 2.2 and 5.00 grams per tonne. Results from the sensitivity analyses are summarized below. The results indicate the robust nature of the overall resource and potential to host substantially higher grades at reduced gold prices and increased cut off grades.

*The sensitivity analysis is inclusive of internal dilution. The sensitivity analysis utilizes resources from the measured, indicated and inferred categories and is for information purposes only.

The base case resource estimate and sensitivity calculations were determined using an assumed minimum mining width of 2.0 metres, average mining costs of $82.00 per tonne and average processing recoveries of 96.5%.

The reported resource extends from surface to a vertical depth of approximately 1,700 metres, with the deposit remaining open to depth.

Qualified Person

The Company’s Qualified Person (“QP”) for the updated resource estimate at Bell Creek Mine is Ralph Koch, P.Geo, Chief Mine Resource Geologist. Mr. Koch is considered a Qualified Person according to the definitions of NI 43-101 and is an employee of Lake Shore Gold. As QP, he has prepared or supervised the preparation of the scientific or technical work and has verified the data disclosed in this press release.

Advanced Exploration Program

In May 2009, the Company commenced an advanced exploration program at Bell Creek Mine mainly focused on de-watering and rehabilitating the existing Bell Creek shaft and workings and collaring a surface ramp at Bell Creek to connect to the underground mine workings. Effective January 1, 2012, production from Bell Creek Mine is recorded as commercial production. Ounces produced at Bell Creek Mine are subject to a 2% NSR royalty payable to Goldcorp. On February 12, 2011, the Company purchased for cancellation a 5% NSR on certain claims on the Bell Creek Mine from Enerplus Corporation (“Enerplus”) by issuing 2.9 million common shares of the Company to Enerplus valued at $12.0 million. Goldcorp is responsible to pay the Company half of the amount paid to Enerplus, which will be offset against royalty payments payable to Goldcorp.

During 2011, a total of 178,676 tonnes of pre-production material from Bell Creek Mine was milled at an average grade of 4.29 grams per tonne for 24,602 ounces. For the fourth quarter of 2011, 48,523 tonnes of pre-production material was milled at an average grade of 4.70 grams per tonne for 6,810 ounces.

During 2011, net project spending at the Bell Creek Mine (including exploration expenditures at the contagious Vogel and Schumacher properties) totaled $20.2 million (net of pre-production revenues of $33.6 million),of which $9.6 million related to exploration. The main ramp at Bell Creek reached the 505 metre level during the fourth quarter of 2011. A total of 422 metres of development was completed in the ramp resulting in total vertical advance of 32 metres during the quarter. In 2011, a total of 2,031 metres of development was completed in the ramp resulting in total vertical distance of 119 metres. Reaching the 445 Level horizon also exposed the top part of the North A Deep mineralization, the new deep discovery at Bell Creek Mine. A definition diamond drilling program for the North A Deep Zone has commenced and is a key component of the Company’s 2012 exploration program.

Commercial Production

Effective January 1, 2012 all production at Bell Creek Mine is recorded as commercial production.

Exploration Potential

Lake Shore Gold believes the potential to grow the Bell Creek Mine resources is excellent both to depth and in a number of areas along strike. The most recent drill results,  prior to the release of the updated resource estimate on March 30 2012, were issued on August 16, 2011. These results included 9 new holes and 30 new wedge holes (22,479 metres) which were completed as part of the ongoing surface diamond drill program at the Bell Creek Mine. The results of the holes successfully extended the mineralization by 400 metres to depth below the current resource (to a total depth of approximately 1600 metres) and up to 50 metres to the east with the mineralization remaining open.