Golden Phoenix Signs Binding MOU to Acquire 80% Interest in Five Peru Properties Totaling Over 25 Square Miles; Expands Into Central and South America

SPARKS, Nev., Oct. 8 /PRNewswire-FirstCall/ -- Golden Phoenix Minerals, Inc. ("Company") (BULLETIN BOARD: GPXM) is pleased to announce it has entered into a binding Memorandum of Understanding ("MOU") with Salwell International ("Salwell") setting forth its intention to acquire an 80% interest in five gold and moly properties located in Peru.

"This Peru Property Package represents our first transaction in South America," stated Tom Klein, CEO of Golden Phoenix. "As we expand throughout the Americas, we are assembling a diversified portfolio of mining properties that includes gold, silver and strategic metals like molybdenum."

Golden Phoenix intends to acquire five separate properties subject to certain terms and conditions, as part of this package including the Porvenir moly stockpile, the Porvenir moly exploration property, the Alicia gold exploration area near and abutting Porvenir; and two large gold exploration plays in the prolific Pataz District; Group of the Eight and the Tornitos. The five exploration properties total approximately 6200 hectares of prospective exploration ground. This equates to approximately 25 square miles.

Golden Phoenix and Salwell have agreed to enter into definitive agreements within the next five business days for the purpose of forming a strategic alliance ("Alliance") in order to develop certain defined properties as well as to identify, acquire and develop additional mining opportunities in the future within Central and South America.

Two of the land packages included in the Alliance proposal lie adjacent to each other in the Pataz region of north central Peru. Pataz is one of the most important gold provinces in the Andes and has produced over 6 million ounces of gold over the last 100 years. Past production has been primarily from high-grade (8-15 gm Au) veins, though more recently large tonnage bulk minable deposits have been recognized in the District and have been brought into commercial production. The trend is largely controlled by Poderosa, Aurifera Retamas and Consorcio Horizonte. Group of the Eight and Tornitos are within six miles of a producing mine.

"In 2008, Peru produced 175 tonnes of gold, ranking it as number five for world gold producing countries," stated David Caldwell, Managing Director of Salwell International. "Peru is an area of significant interest for major gold producing companies including Barrick, Newmont and other international producers. Because of this global interest, our properties provide a strategic advantage moving forward."

The parties contemplate that in furtherance of the Alliance, the Company will be responsible for financing, management, distribution of profits, formation and maintenance of operating reserves, and accounting on all such properties acquired, while Alliance will be responsible for identifying and delivering viable opportunities within Central and South America to the Company, facilitating operations as reasonably requested and handling any necessary permitting or documentation related to potential property acquisitions.

It is also anticipated that the Company will govern the operations of projects under the Alliance and will have the right to encumber any properties in order to finance their development, along with the right to withdraw from a particular project, with such right then reverting to Salwell. The parties contemplate that definitive agreements will provide for the ability of the Company to purchase Salwell's retained 20% interest in a property obtained pursuant to the Alliance for cash and/or shares of the Company's common stock, for Salwell's pro-rata share of a net profits value as determined by a qualified feasibility study. Although the parties anticipate entering into definitive agreements in the near future, there can be no assurance that the Alliance will succeed or that the proposed property acquisitions will be consummated. Further disclosure regarding this transaction can be found in the Company's Form 8-K to be filed with the SEC as of the date of this press release.

Mr. Klein concluded: "Golden Phoenix has taken another step in acquiring multiple properties in multiple jurisdictions. Our Royalty Mining Growth Strategy is moving forward as planned."

Please visit the Golden Phoenix website at: http://www.golden-phoenix.com/.

Golden Phoenix Minerals, Inc. is a Nevada-based mining company whose focus is Royalty Mining in the Americas. Golden Phoenix is committed to delivering shareholder value by acquiring, developing and mining superior precious and strategic metal deposits throughout North and South America using competitive business practices balanced by principles of ethical stewardship. Golden Phoenix is a 30% joint venture partner with Scorpio Gold on the Mineral Ridge gold and silver property near Silver Peak, Nevada, and owns the Adams Mine and Duff Claim Block near Denio, Nevada, and the Northern Champion molybdenum mine in Ontario, Canada. Golden Phoenix has an option to earn an 80% interest in the Vanderbilt Silver and Gold Project, and the Coyote Fault Gold and Silver Project, both of which are adjacent to the Mineral Ridge gold and silver property near Silver Peak, Nevada.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: The statements by officers of the Company, and other statements regarding optimism related to the business, expanding exploration and development activities and other statements in this press release are forward-looking statements within the meaning of the Securities Litigation Reform Act of 1995. Such statements are based on current expectations, estimates and projections about the Company's business. Words such as expects, anticipates, intends, plans, believes, sees, estimates and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. Actual results could vary materially from the description contained herein due to many factors including continued market prices for the Company's mineral products. In addition, actual results could vary materially based on changes or slower growth in the gold and base and precious metals markets; the potential inability to realize expected benefits and synergies in the Company's mining operations; domestic and international business and economic conditions; changes in the mining industry for base and precious minerals; unexpected difficulties in restarting or expanding production at the Company's mines; the need for additional capital and other risk factors listed from time to time in the Company's Securities and Exchange Commission (SEC) filings under "risk factors" and elsewhere. The forward-looking statements contained in this press release speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release.

For More Information Contact: Robert Ian, Director of Corporate Communications [phone] [e-mail]

Golden Phoenix Minerals, Inc.

CONTACT: Robert Ian, Director of Corporate Communications of Golden
Phoenix Minerals, Inc., [phone], [e-mail]

Web Site: http://www.golden-phoenix.com/