144 PROPERTY (EXPLORATION)

The 144 property was obtained through the acquisition of West Timmins Mining Inc. In November 2009. The property is located immediately south of Thunder Creek and covers about 4.0 kilometres of the same ultramafic-sediment contact that hosts Thunder Creek and Timmins Mine. (Photo below: Drill rig working at 144 property, directly beside Highway 144).

Highlights

• Lake Shore Gold commenced drilling on the 144 Property in late 2010.
• In February 2011, the Company announced results of the first 12 holes, including the discovery of a new gold zone near surface. Strong gold mineralization was intersected within 200 metres of surface, which compares favourable to the mineralization at Thunder Creek at similar shallow depths.

History

1992 - Band-Ore Resources Ltd begins acquiring claims that will form the 144 Property.

September 2006 - West Timmins Mining Inc. formed through amalgamation of Band-Ore Resources and Sydney Resources Corporation. West Timmins conducts limited drilling on 144 Property.

November 2009 - Lake Shore Gold acquires Thorne Property through completion of business combination agreement with West Timmins.

October 2010 - Lake Shore Gold commences drilling at 144 as part of an initial, high-level phase of testing designed to cover a 1.2 km strike length with a wide-spaced pattern of holes in order to develop an improved geologic model.

February 2010 - Lake Shore Gold announcing discovery of new gold zone at 144, within 200 metres of surface. Gold values compare favourably to mineralization at Thunder Creek at similar elevations.

Exploration Potential

The exploration potential of the 144 Property is very encouraging and is an important potential value catalyst for the Company. The Property covers approximately 4.0 kilometres of the same volcanic/ultramafic intrusive/sedimentary contacts found on the Thunder Creek and Timmins Mine properties.

Initial drilling at 144 intersected multiple zones of gold mineralization located along a 1.2 kilometre stretch of the contact and associated with porphyritic intrusions similar to those which host some of the broadest and highest grade intercepts from Thunder Creek. Given the shallow nature of the initial drilling, the potential to expand the known mineralization within the initial 1.2 kilometre area, as well as outside it in other areas along the contact, is considered excellent.

The Company commenced drilling at 144 during the second half of 2010. Initial results were released on February 28, 2011 and were from the first 12 holes (6,232 metres) drilled at the property. The results included the discovered of a significant new gold zone with strong similarities to the Thunder Creek Rusk and Porphyry zones and with multiple occurrences of visible gold. Gold values were intersected within 200 metres of surface that compare favourably to Thunder Creek mineralization at similar shallow depths. Very importantly, the grades and widths of mineralization increased with depth, with the potential for new zones to the north and along strike considered to be excellent. Among initial intercepts were 2.41 grams per tonne over 19.00 metres and 4.96 grams per tonne over 5.40 metres.

In addition, the Company has performed limited drilling at Thunder Creek along strike to test for extension southwest towards the 144 property. On November 24, 2010, the Company announced that it had extended the deformation and alteration zone at Thunder creek by 350 metres from Thunder Creek towards the 144 property. On July 26, 2011, the Company announced that surface drilling at Thunder Creek had discovered a potential new zone 500 metres to the southwest towards 144.