Timberline Resources Corp. Message Board

COEUR D'ALENE, IDAHO, May 16, 2012 (MARKETWIRE via COMTEX) -- Timberline
Resources Corporation (TSX VENTURE: TBR)(NYSE Amex: TLR) ("Timberline" or the
"Company") announced today that it has signed an amended non-binding Letter of
Intent to increase its ownership stake in the Butte Highlands Gold Project from
50-percent to 100-percent, acquiring the remaining interest in Butte Highlands
JV, LLC ("BHJV") from its joint venture partner, Highland Mining, LLC ("Highland
Mining") as previously announced on April 10, 2012.

The revised terms of the agreement call for Timberline to acquire the remaining
50-percent interest in BHJV in exchange for issuance of shares of the Company's
common stock, not to exceed 5% of the common stock issued and outstanding as of
the date of closing, along with a Net Smelter Return (NSR) production royalty of
5% on all production from Butte Highlands, and a future cash payment to Highland
Mining of $6 million to be made no later than 2 years subsequent to the
commencement of commercial production at Butte Highlands. Consistent with the
original agreement, Highland Mining will completely c ancel its outstanding loan,
including principal and interest, to BHJV for more than $24-million of
development costs incurred at the project to-date. The deal is expected to close
in the current quarter, subject to standard closing conditions and regulatory
approvals, including the approval of the NYSE Amex and the TSX Venture Exchange.

Highland Mining is controlled by Ron Guill, who is also a director of the
Company and the Company's largest shareholder.