LATEST NEWS: Vancouver, British Columbia: Stikine Energy Corp. (TSX.V: SKY)("Stikine" or the "Company") announces the following update of itspilot plant operations located in Abbotsford, British Columbia.Sepro Mineral Systems Corp. has recently completed modifications to thenew attrition scrubbers, motors and related electrical components atthe pilot plant. Maintenance repairs have also been made to otherequipment. Much of this work was not anticipated and has caused asignificant delay to the plant's operation and opportunities to testsand products. The process flowsheet is a simple and innovativearrangement of equipment that is off-the-shelf and available from avariety of manufacturers at larger production sizes. However, theassembly of the various components at a pilot-scale is new to theindustry and presents unique fabrication and commissioning challenges.As a result of the delays the new plant arrangement has only recentlyachieved steady-state and limited quantities of product samples. Proppant testing of those initial samples shows that the operation hasnot yet been optimized to produce API/ISO sand specifications. Changeshave been made to equipment settings and new samples will be shipped totest. This iterative approach to fine tuning the pilot plant isnecessarily a time dependant exercise. However, the Company expects toreport on results from its process work on Nonda material through themonth of September 2011. The pilot plant has previously demonstrated steady-state production ofNonda 100 mesh sand that readily achieves API/ISO recommendedspecifications for proppants. Bench-scale testing on a variety ofNonda samples has also reliably produced -40+70 sand samples that meetor exceed recommended specifications. The Company looks forward tocompleting the current optimization and fine-tuning stage of its newplant equipment shortly.Scott Broughton, P.Eng. is the qualified person as defined by nationalinstrument 43-101 responsible for the preparation of this news release.STIKINE ENERGY CORP."Scott Broughton"