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Strike Minerals research and analysis

Contributed by eResearch

By Bob Weir

Strike Minerals Inc. has purchased the balance of ownership of key gold exploration claims at Hays Lake near Schreiber, Ontario, which the Company had not purchased under the original option agreements with the three vendors (see page 2). The claims are known as the Hemlo West properties, and are located 48 kilometres west of the Hemlo Gold Camp.

Strike Minerals has a 100% interest in the Hemlo West properties, and has bought out all future exploration obligations for:

- $15,000, payable on the signing of the purchase agreement; and

- 1,020,000 common shares of Strike.

The vendors retain 2% net smelter royalties (NSR), including any associated NSR payments, along with surface rights where applicable.

Strike Minerals is conducting an initial program of surface geological and alteration mapping on the property, with a view to preparing an exploration program that will include drill testing in 2012 to establish the extent of the mineralization.

RECENT APPOINTMENTS

Strike Minerals announced on December 7, 2011 that Bruce Staines, P.Eng. has been appointed Vice- President, Mine Development, focusing on the Edwards Gold Mine project. Mr. Staines has over 50 years’ experience in the mining and construction industries in North America. He has extensive experience in mining highly-concentrated ore deposits, both at surface and at depth. Mr. Staines’ career has included positions such as Gerneral Manager for Claude Resources and Mine Superintendent for Central Patricia Mines.

The Company also announced the appointment of Ian McColl, P. Eng. to the Board of Directors. Mr. McColl has five decades of experience in production plant operations and management, project management and engineering in the minerals and other resource industries in Canada and worldwide.

THE COMPANY

Strike Minerals Inc. is an early-stage mining company with a flagship formerly-producing gold mine that is being readied to resume production.

The Edwards Gold Mine is located in the Goudreau Lake Deformation Zone in Ontario, an area that hosts a number of known gold deposits. The mine was in production from 1996 until 2001, with the previous operator producing 144,000 oz of gold at an average grade of 0.39 oz/t. The Company received permission to recommence operations at the mine and is dewatering the ramp and refurbishing the underground.

Hemlo West

Strike Minerals recently announced the completion of agreements with three parties to give Strike Minerals a 100% undivided interest in a package of gold exploration properties (the Hemlo West properties) in the Hemlo- Schreiber gold district at Hays Lake near Schreiber, Ontario. The properties are located about 270 km to the west of the Goudreau Lake Deformation Zone. Consideration for the properties includes cash, a net smelter royalty, and the issuance of 10.13 million Strike Minerals common shares to the vendors. At Hemlo West, Strike Minerals will be conducting an initial program of surface geological and alteration mapping, in preparation for drill testing and the establishment of a resource estimate.

RECOMMENDATION AND TARGET PRICE

We continue to recommend Strike Minerals as a Speculative Buy for risk-tolerant investors, but are also keeping our Target Price for the shares Under Review due to adverse market sentiment towards junior mining companies, and the concomitant severe downturn in junior mining stock prices that has distorted their underlying values.

Our decision to place the shares of Strike Minerals “Under Review” had nothing to do with the fundamentals, operations, or prospects for the Company, which we view positively, and particularly after the announcement of the Waterton financing transaction (see eResearch’s November 4, 2011 Perspective on Strike Minerals). The collective value of the Company’s recently-acquired Hemlo West acquisitions also provides further potential. We expect to remove the shares from being Under Review with the publication of our Update Report, which we anticipate will be in early 2012.

eResearch Analysts:
Yuri Belinsky, B.A., M.A.
Bob Weir, B.Sc., B. Comm, CFA