Shareholder Update

Falkland Gold and Minerals Ltd
10 September 2007


                       Falkland Gold and Minerals Limited
                                (the 'Company')

                               Shareholder Update

10 September 2007

The Board of Falkland Gold and Minerals today updates shareholders on
developments since the Interim results were announced on 12 June 2007

The work programme in the Falklands was designed to identify the source of the
alluvial gold recovered from the streams.  This gold is associated with a zone
of tight, east-west folding which has affected the Bluff Cove and Port Sussex
Formations amongst other rock sequences.  These formations contain favourable
interbedded shales and sandstone units that could, given the correct structural
traps, be favourable targets for Slate Belt type gold and in particular 'Saddle
Reef' styled mineralisation. The saddle reefs are currently being investigated
but the Board believes that these are unlikely to generate ore bodies of
economic size. The work programme has also been amended having regard to the
recommendations of Professor Viljoen and although minor uranium anomalies have
been detected these were not of economic interest. This work and the completion
of the current drilling programme elsewhere is expected to be complete by the
end of 2007.

The Board has decided that unless the remaining work programme identifies
deposits likely to be of commercial interest, it will cease exploration
activities in the Falklands. At that time the Company is expected to have cash
balances of approximately £3.5million and an experienced exploration team fully
equipped with 2 drills and sample processing equipment. The Board intends to
seek opportunities elsewhere in the World and has initially identified gold,
molybdenum and uranium as the metals most likely to be of interest. Shareholders
will be updated as soon as possible on the Board's proposals for the next stage
of the Company's development.

The Board is disappointed that the exploration programme in the Falklands has to
date not been successful and would like to express its appreciation of the
efforts of its employees and the cooperation of the Government and people of the
Falklands.

Enquiries:
Falkland Gold and Minerals Limited
Richard Linnell (Chairman) [phone]

W.H. Ireland Limited
James Joyce [phone]



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