Mr. Christopher Herald of Solitario reports

SOLITARIO MAKES PRIVATE PLACEMENT INTO ELY GOLD & MINERALS AND SIGNS LETTER OF INTENT TO JOINT VENTURE ELY GOLD & MINERALSA MT. HAMILTON GOLD PROJECT IN NEVADA

Solitario Exploration & Royalty Corp. has arranged a private placement in Ely Gold & Minerals Inc. of $250,000 for units, described below. This placement is part of a letter of intent (LOI) between Solitario and Ely to joint venture Ely's Mt. Hamilton gold project situated at the southern end of the prolific Battle Mountain gold trend in eastern Nevada. The Mt. Hamilton project is an advanced gold project where over 314 drill holes have defined the Centennial gold deposit. Under the LOI, Solitario may earn up to an 80-per-cent interest in the project by completing various staged commitments.

Chris Herald, president and chief executive officer, stated: "We are delighted to partner with Ely on this very attractive advanced gold project and commend Ely in its efforts to bring the project to this stage. Solitario's core strategy remains exploration and royalty generation through net-profit-royalty-structured joint ventures. We believe the Mt. Hamilton project has good exploration potential."

Trey Wasser, executive vice-president of Ely, stated: "We are very excited to be partnering on the Mt. Hamilton project with Solitario. This investment and joint venture provides the capital to fast-track the development of a significant asset in Nevada. In a difficult market environment, we are pleased to have a partner with the proven track record and the financial strength of Solitario."

Terms of the LOI

On signing the LOI, Solitario subscribed for a private placement of 3,333,333 units of Ely at a price of 15 cents per unit for a total consideration of approximately $500,000. Each unit consists of one common share and one-half share purchase warrant entitling the holder of a whole warrant to purchase an additional share of Ely for 25 cents, with such warrant expiring two years from the subscription date. The private placement consists of two tranches; the first tranche of $250,000 is to be financed on or before Aug. 31, 2010, subject to TSX Venture Exchange acceptance, and the second tranche will be financed upon Ely shareholder and exchange approval of the joint venture arrangement anticipated no later than late October, 2010.

Solitario will be conducting due diligence on the Mt. Hamilton project through the date of shareholder approval. Thereafter, Solitario will be committed to spend $1.0-million on exploration and feasibility work, and to pay $300,000 (U.S.) in an advanced royalty payment. After completing these initial commitments, Solitario may elect to terminate its interest in the Mt. Hamilton project at any time and will have no further earn-in obligations on the project.

To earn its full 80-per-cent interest in the project and fulfill other LOI commitments, Solitario is further required to:

• Make cash payments to the subsidiary of Ely which will hold Ely's joint venture interest totaling $2.75-million (U.S.) in cash, issue 300,000 shares of Solitario common stock and subscribe to $2.50-million (U.S.) worth of Ely common stock at market, all of which are scheduled from 2011 through mid-2015;
• Make payments of $300,000 (U.S.) per year in advanced royalty payments that are deductable against future production royalties to the underlying royalty owner and, prior to commercial production, pay $5.0-million to reduce the NSR royalty rate from 8 per cent to 3 per cent;
• Complete a bankable feasibility study;
• Upon request, arrange 100-per-cent project financing for development of the Mt. Hamilton project after completion of a bankable feasibility study; construction and permitting costs incurred after feasibility will be shared pro rata, however, Ely may elect to have Solitario finance all costs, with such costs, plus interest, to be repaid by the joint venture to Solitario out of 80 per cent of Ely's share of net proceeds from the joint venture.

The proposed joint venture remains subject to Ely shareholder approval and final acceptance by the TSX Venture Exchange.

For a more complete list of the terms and conditions under the LOI, a copy of the LOI is available online at www.sedar.com, www.solitarioxr.com & www.elygoldandminerals.com.