Mr. Steven Osterberg reports

TIMBERLINE RESOURCES ANNOUNCES ASSET SALE AND PROVIDES CORPORATE UPDATE

Timberline Resources Corp. has entered into a binding letter of intent for the sale of its 50-per-cent interest in Butte Highlands JV LLC to New Jersey Mining Company of Coeur d'Alene, Idaho. BHJV owns the Butte Highlands project, an underground gold project being developed south of Butte, Mont. NJMC owns the fully permitted and developed Golden Chest mine and mill in north Idaho, and plans to commence gold production at the Golden Chest mine later this year. Terms of the sale of 100 per cent of Timberline's interest in BHJV call for NJMC to make a $50,000 downpayment upon the execution of the LOI, to be followed by a payment of $175,000 and delivery of three million shares of NJMC common stock by Jan. 31, 2016, to close the purchase.

Steven Osterberg, Timberline's president and chief executive officer, said: "The opportunity to monetize our non-core, non-operating interest in the Butte Highlands project allows Timberline to further focus on our Nevada projects. Butte Highlands is a unique fit for NJMC to capitalize on their mining and milling expertise, and help finalize engineering and development of the mine."

Scott Davis will succeed Randal Hardy as the company's chief financial officer following a brief transition period. Mr. Hardy has resigned from his office effective Jan. 19, 2016, but will remain available to the company during a period to ensure a smooth transition.

Mr. Davis is a CPA, and CGA and a partner of Cross Davis & Company LLP certified general accountants, a firm focused on providing accounting and management services for publicly listed companies. His experience includes CFO positions of several companies listed on the TSX Venture Exchange, and his past experience consists of senior management positions, including four years at Appleby as an assistant financial controller. Prior to that, he spent two years at Davidson & Company LLP chartered accountants as an auditor, five years with Pacific Opportunity Capital Ltd. as an accounting manager and two years at Jacobson Soda and Hosak, chartered accountants.

The company continues to evaluate strategic alternatives with various parties to finance the company's Nevada projects and for general working capital purposes. During this continuing period of difficult market conditions, the company is operating under streamlined management and significant cost-control measures, including consolidation of facilities, and staff and salary reductions.

The structure of any future transaction remains to be determined, and the consummation of any transaction remains subject to completion of due diligence, execution of definitive agreements, board and regulatory approvals, and other customary closing conditions. There is no certainty that any specific transaction will be completed.

The company is also reviewing its current listing on the NYSE Market in light of the prevailing market conditions affecting the exploration industry.

Steven Osterberg, PhD, PG, Timberline's president and CEO, is a qualified person as defined by National Instrument 43-101, and has reviewed and approved disclosure of the technical contents of this news release.