Go to YouTubePlay video St Elias Mines Secrets of The Self Made CEO Lori McClenahan 00:02:46 Added on 27/09/2011

Dear readers,

As you can see, this letter, description and point form summary has been sent to various,and what are considered, important recipients. The reasons being, after countless letters to all levels of government, many politicians, regulators, authorities on such matters, we, the majority St Elias Mines shareholders, are left with no choice but to broaden the awarness to the public, whereas previous pleas have seem to have fallen on deaf ears. This is a publicly traded company that trades on the TSX Venture Exchange, the OTC in the U.S., and on the Frankfurt Exchange in Germany. (Trading Symbol: SLI (TSX Venture Exchange) EKL (Frankfurt Exchange) SELSF (U.S. Clearing Symbol) )

Through our course of following what is suggested by Regulatory bodies, to help protect our investment, we shareholders over the last couple years took it upon ourselves to inform, engage in utmost due diligence (DD), covered not only aspects pertaining to a mining stock, but also every aspect of the markets and how they function.Through the course of this DD, many geologists and even some geophysicists were consulted by investors individually. The bulk of this DD was conducted and conveyed on the public stock investor message board of Agoracom, http://agoracom.com/, with a portion of later DD done on a private discussion board as well.

It may be easier and more organized perhaps, if I tell the story and number the points as footnotes, to be elaborated on at the end of the story. This will clearly establish the perspective of most investors, as we have been here for years, some around 10 years or so in this investment.

I personally entered the SLI stock around the fall of 2009, upon reading a news release of bulk samples averaging over 1 ounce per ton gold. At the time, I was trading stocks for personal gain and my interests were mostly in mining stocks. As a prerequisite to being a successful and prudent manager of my own trading funds, I did a lot of research on geology and understanding news releases from mining stocks, which in turn enhanced my success on trading these stocks for gain.Once in awhile, I would come across what I deemed as buyout targets, in which considerable gains could be made, I was fortunate enough to correctly identify a couple, which added to my confidence and that my research held merit and could be relied upon. Having said this, the news release put out by St Elias Mines in 2009 of their Tesoro property in Peru, definitely caught my eye and caused me to invest, whereas bulk samples are usually indicative of a mining grade, and at the time, shaft mining required around 7 g/t gold grade to be feasible and open pit mining safely at 3 g/t, as a rule of thumb. This formula was dependent on the price of gold (POG), of which at the time was somewhere around $1000 per ounce. As the POG rose dramatically above this base figure of $1000 per ounce, it enabled much lower grades to become economical, but not directly proportional because of inflation in mining costs, nevertheless, a much lower grade than the ones mentioned above were becoming economical.

So, with news releases of bulk sampling being around an ounce per ton gold, it looked pretty evident that SLI would have an economical deposit that could be mined or eventually sold to the highest bidder, in which investors make the biggest returns, usually. Upon further research, and to my delight, I find that there is also disseminated gold, that could warrant an open pit mine, which further assured that this could be a buy out scenario.Also add here, that a corporate presentation as well as an audio of the CEO at an AGM, ascertains that 1 ounce per ton gold was taken from DEVELOPMENT MATERIAL. The Mining Act of Ontario defines material this way:

this property further, later on in this letter.

2010 company review; http://www.marketwire.com/press-release/st-elias-mines-ltd-reviews-2010-frankfurt-ekl-1374675.htm

In Oct 2011, the Mining Stock Report came out on the Tesoro property, (note; this should be read meticulously from a geological perspective). The stock price at the time of this release should also be noted as well as the stock price forcast. Also, the trading that happened on the day of this release, in particular, about 2 hours before the release of this report, there is selling pressure coming on the stock, which followed a steady share price increase before the release. The stock hit is all time high that day of around $2.83 per share, ending the day around $2.63, with a report suggesting a future stock price of over $3.00. Also keep in mind here, that the company at this time is in the process of the first ever drilling from the property, in which initial results could come at anytime on a property that could very well be a huge gold find, as well as trenching results from this same property that began in May of the same year. The hype that got this stock up to such a high level for a company with little to no initial reserves, is the results of a Quantec Geosciences geophysical survey, which is what it is, it suggests substantial mineralization. So, the big question here is, why would anyone sell prematurely to initial drill and trench results from a property that could very well be the next big gold find? And especially where these initial results did not start being released to the market in Jan 2012. I should add here, that even 2 days before the initial results were released, the stock started a dramatic decline from around a $2.00 share price.

So, as you can see the 2 above mentioned reports, a 2010 technical report done by an independant geologist, (which seen him later becoming a director of SLI), and other news releases pertaining to the geology of the property, video interviews of our CEO and corporate presentations, I would say a pretty solid case was made to substantiate that the main Tesoro property alone was very valuable and could easily justify an elevated stock price. As excitement grew over the few years leading up to initial results, it resulted in many shareholders connecting to other shareholders and sharing thoughts,info and friendship, to substantiate their own thoughts on this being an excellent investment and perhaps seeing if the adage "too good to be true", had any life here. As a result of communication between shareholders, it was found that an impressive number of shareholders had geo/geophysicist friends that they would consult, directly or indirectly for a second opinion, if you will. The most critical questions asked of these professionals, were their opinion on the geophysical anomalies portrayed by Quantec in their geophysical report of the property and in conjunctuion with historical data from the property. The remnants of BRE-X still lingered in the thoughts of some, hence the consultations of an independent review, which seemed positive to very positive, depending on the degree the geo analyzed the data. I personally had one geo look at some of the geophysics, his first reply was that the anomalies looked impressive, but could really be anything. Then I informed him that we had tangible data from down to the 100m level with sample results and information on the mineralization found there, and plotted this info on a side view of the appropriate geophysical slide, once he saw the corresponding sample numbers his reply was, "oh yeah,what else are you supposed to believe", meaning that my initial thoughts conveyed to him that this had mass potential, were well substantiated by this determination. I also consulted another respected geo for his opinion, he being a geo that didn,t really like geophysics, moreso opined on the regional geology saying that it looked favourable. Although substantial data was sent to him for review, he only took a general look at it, hence his general reply. I consulted a friend that had a geo look at the first set of drill results to come from the property, his opinion, there seemed to be a huge disconnect from drill results to the historic data, which were and are mine as well. A lot of this disconnect is due to the fact that the news releases pertaining to the drilling and trenching are very vague and important information seems to be non existent, which in turn, does not allow the reader to this day, make a reasonable investing decision. The missing info from these releases does not allow one to connect the dots to verify that the geophysics is incorrect or not and disables one to successfully coordinate this drilling/trenching info directly and clearly to the property. So, one is left with, a reasonable investing decision cannot be made because of inadequate released information. We dont have the drill hole angles to see where and how they intersected the Quantec anomalies and the drill hole information we do have, seems to end prematurely to the intersecting the anomalies expressed by high chargeability, with little to no sample results even though the drill holes pierced these anomalies, some holes by 100m or more. These anomalies are high chargeability anomalies which are usually a result of sulphide mineralization in this circumstance and a direct association to gold content to sulphides is established on the property. To enhance, the gold grade goes up with the increase in sulphide content, at least on the available historic data. Meaning, that these high chargeability anomalies should not be present if the sulphides are not there, a quote from the CEO "its impossible", in which I agree totally. So, the geophysics from Quantec is that accurate, that you can coorelate it to all historic data precisely, yet the drill holes from depth do not correlate. The geological attributes of this property are very interesting and perhaps to fully understand the dynamics of which I speak, great consideration should be taken of this aspect as well.

Shareholders started to become restless around mid to late summer of 2011. We were waiting for a drill permit previous this time that was applied for in summer of 2010 and not received til May 2011. Also around this time, the financials were showing huge increases in the travel expenditures, I believe if you take the 3 year average of this travel expenditure from Feb 2013 back to 2010, it will equate to around $3000 per day being spent on travel alone! This is an exploration company looking for minerals, the travel expenditures initiated grave concerns from the shareholders as well as smaller concerns showing up in the financials, such as salaries being paid to certain executive/directors. This company, on paper in the financials, does not have a revenue stream derived from sale of products or services, it is, as per the financials, totally dependent on securing financing from the market in the line of issuing stock. As we know, issuing of stock dilutes existing shareholders and becomes a concern. It is realized that a company must raise funds to operate, but it is also expected that discernment goes into the spending of these funds by management. This flamboyant travel expenditure also was coinciding with TV appearances, a Forbes interview, many meetings in Europe and the U.S. with what appeared to be distinguished firms and high net worth individuals, giving the impression to some shareholders that perhaps this was a huge find and that in the course of business, this leg work had to be done. Here is a link to the Forbes interview, take note of the remarks near the end "major gold find" "I know", and others,

Also perhaps, the question as to why to even do this interview, should be entertained. Sure, these are promotional efforts, but wouldn,t most believe that more discretion should have been used by the CEO? The date of this interview should also be noted, Sept 27/2011 in conjunction of when we started trenching the property in May of that year and started drilling somewhere between June and Aug of that year, (the news releases concerning the start date for drilling are unclear, hence the variable date).

Also, reports from investors and others around the flamboyant travel time, suggests the CEO being under the influence of alcohol during some presentations and meetings, causing a less than desirable impression for future funding that may be needed by the company. Another concern related to this travel expenditure, was the use of private jets/planes, with on one occasion, lobster being served in the sky, as rumoured by a source/s. If this was shareholders money being used for this extravagant lifestyle, the shareholders have/had justifiable concerns. Sure, if she had confirmation that we had a huge gold find, she deserved to have fun and I had no real problems with this at the time, because I believed she was competent and my investment security was enhanced by her actions. In reality, what CEO would publicly reveal a lavish lifestyle, perhaps flaunt a property, if it could not be justified at the time?

continued.....