CALGARY, Canada, August 31 /PRNewswire/ --     Alhambra Resources Ltd. ("Alhambra" or the "Corporation") announces its
financial and operating results for the quarter ended June 30, 2007. 
Effective May 1, 2006 the Company declared commercial operations for 
accounting purposes. As a result, the financial statements for the 
second quarter of 2007 have limited comparability to 2006. All amounts 
related to the financial results are expressed in Canadian dollars 
unless otherwise indicated.

HIGHLIGHTS:

- Revenue from gold sales amounted to CDN$3.5 million based on the sale 
of  4,838 ounces

- Generated CDN$0.6 million of cash flow and CDN$0.1 million of net 
income from mining operations

- The Corporation recorded negative cash flow from operating activities
of CDN$0.1 million (CDN$0.00/share) and a net loss of CDN$1.1 million 
(CDN$0.02/share)

- Received an updated National Instrument 43-101 resource and reserve
technical report

- Debt free with CDN$1.7 million of cash and cash equivalents

- Spent CDN$1.9 million on capital expenditures of which CDN$1.1 million 
was on exploration

- Operating costs to produce an ounce of gold were CDN$372.93

- Completed 5,697 metres of drilling and 5,532 cubic metres of trenching

- Stacked 5,142 ounces of recoverable gold

- The recoverable gold in work in process as of June 30, 2007 was
21,220 ounces

OVERVIEW

The equipment problems suffered during the first quarter of 2007 by the
Corporation's blasting contractor have been resolved. By the end of the 
second quarter of 2007, the stacking of oxide ore ("ore") on a monthly basis 
was on target to achieve the 2007 stacking schedule. The amount of ore 
stacked during the second quarter of 2007 totaled 209,500 tonnes compared to 
123,250 tonnes stacked during the first quarter of 2007, up 70%.

FINANCIAL HIGHLIGHTS
    -------------------------------------------------------------------------
    (in C$ except per           Three Months ended          Six Months ended
    share amounts)                    June 30                   June 30
    -------------------------------------------------------------------------
                               2007         2006         2007          2006
    -------------------------------------------------------------------------
    Revenue from gold
    sales                  $ 3,529,337  $ 2,052,710  $ 6,138,312  $ 4,444,474
    -------------------------------------------------------------------------
    Net loss               (1,073,493)    (554,349)  (1,872,784)  (1,230,093)
    -------------------------------------------------------------------------
    Per share (basic
       and diluted)             (0.02)       (0.01)       (0.03)       (0.02)
    -------------------------------------------------------------------------
    Weighted average
    shares outstanding
    Basic and diluted       69,771,837   56,510,501   69,511,411   54,832,531
     ------------------------------------------------------------------------
    Shares outstanding
    at end of period        70,408,980   62,696,199   70,408,980   62,696,199
     ------------------------------------------------------------------------



For the second quarter of 2007, the Corporation recorded a net loss of
CDN$1.1 million, or CDN$0.02 per basic and diluted share. This compares to a 
loss  of CDN$0.6 million or CDN$0.01 per basic and diluted share in 2006. 
Cash flow  utilized from operating activities for the quarter was CDN$0.1 
million or CDN$0.00  per basic and diluted share as compared to cash flow 
utilized in operating  activities of CDN$0.2 million or CDN$0.00 per basic 
and diluted share in 2006.

Revenue from the sale of gold amounted to CDN$3.5 million. This was 
realized from the sale of 4,838 ounces ("ozs") of gold at an average price 
of CDN$729.50 per ounce ("/oz"). The per oz operating cost to produce an 
ounce of gold for this quarter was CDN$372.93/oz sold, being 4% lower than 
the per oz operating cost of CDN$388.85 incurred during the first quarter 
of 2007. Alhambra continues to be optimistic that its operating cost to 
produce an ounce of gold will continue to be reduced as higher anticipated 
production levels are  experienced during the remainder of 2007

At June 30, 2007, the Company had CDN$1.7 million in cash and cash
equivalents and remained debt free. The average rate of exchange for the C$
per US$1.00 was 1.0975 for the second quarter of 2007.

OPERATIONS REVIEW

During the second quarter of 2007, a total of 432,620 tonnes of waste was
mined and 209,500 tonnes of ore at a grade of 1.09 grams per tonne ("g/t") of
gold was stacked on the heap leach pads.

Alhambra began the quarter with 20,916 ozs of recoverable gold in work in
progress and exited the quarter with 21,220 ozs after selling 4,838 ozs.
Production for the quarter (defined as gold sales plus or minus the change in
work in progress) totaled 5,142 ozs

For the six months ended June 30, 2007, the Company produced 8,428 ozs of
gold and sold 8,350 ozs of gold.

RESOURCE AND RESERVE STUDY

In the second quarter of 2007, The Corporation received a National
Instrument 43-101 technical report entitled "Resources and Reserve Estimation
Study on the Uzboy Gold Deposit, Akmola Oblast, Kazakhstan" (the "Updated
Report") prepared by ACA Howe International Ltd. ("Howe") dated June 5, 2007
which updated the reserve estimate for the oxidized and transition portions
and the resource estimate for the oxidized, transition and sulphide portions
of the West and East zones of the Uzboy gold deposit.

The Updated Report included all diamond drilling results from the Uzboy
gold deposit up to December 31, 2006. These resource and reserve estimates
updated the resource and reserve estimates contained in the feasibility study
on the oxide portion of the Uzboy gold deposit dated June 30, 2006. The
Updated Report and the feasibility study in their entirety were filed on 
Sedar at http;//www.sedar.com on June 7, 2007 and July 18, 2006, 
respectively. The effective date for the reserve and resource statements in 
the Updated Report was December 31, 2006 and included the results of 
Alhambra's 2006 drilling program.

In the Updated Report, Howe estimates that at a 0.20 g/t cutoff, the
resources for the Uzboy gold deposit are 19,071,001 tonnes at an average 
grade of 1.08 g/t gold totaling 661,645 ozs of Measured mineral resource, 
8,392,444 tonnes at an average grade of 0.87 g/t gold totaling 234,605 ozs 
of Indicated mineral resource and 22,512,850 tonnes at an average grade of 
0.73 g/t gold totaling 528,827 ozs of Inferred mineral resource.

In the Updated Report, Howe also reported 3,416,719 tonnes at a grade of
1.17g/t for a total of 128,405 ozs of gold in the Mineable Proven reserve
category plus 631,035 tonnes at a grade of 0.82 g/t for a total of 16,636 ozs
of gold in the Mineable Probable reserve category for the oxidized and
transition portions of the Uzboy gold deposit. The recoverable gold contained
in the Mineable Proven plus Probable reserve categories as estimated by Howe
was 95,200 ozs as at December 31, 2006.

EXPLORATION PROGRAM

The 2007 exploration program which commenced in mid January continued
throughout the second quarter.

The main focus of the 2007 exploration program is to continue delineation
of the gold mineralization in the West and East zones of the Uzboy gold
deposit and to diamond drill five other zones of gold mineralization 
including Kirtoge, Aygabak, Shirotnaia, Dombraly and the Central Zone 
of the Uzboy gold Deposit

The 2007 exploration program consists of diamond drilling, reverse air
blast circulation ("RAB") drilling and hydro-core lift ("KGK") drilling
totaling 76,500 metres ("m") and 50,000 m(3) of trenching.

A total of 5,697 m were drilled in the second quarter of 2007. This was
comprised of 3,703 m of diamond drilling and 1,994 m of RAB drilling. In
addition, a total of 5,532 m(3) of trenching was completed in the second
quarter of 2007.

Total exploration activities completed to the end of the second quarter
of 2007 amounted to 12,113 m of drilling (6,880 m of diamond drilling and
5,233 m of RAB drilling) and 5,532 m(3) of trenching. Exploration activities
are typically slower during the second quarter due to soft ground conditions
caused by spring breakup.

The main components of the exploration program conducted during the
second quarter are highlighted below.

1 Uzboy Gold Deposit

a) West Zone

The Uzboy gold deposit is the main focus of the Corporation's 2007
exploration program. A total of 11 diamond drill holes (3,703 m) were
completed in the West zone during the quarter. Six diamond drill holes were
completed on Section 65, three drill holes were completed on Section 57 and
one hole was completed on each of Section 39 and Section 45. The drill holes
on Sections 39 and 45 were deep holes to test the continuity of the gold
mineralization at depth below previously intersected intervals of gold
mineralization. Diamond drilling was completed on Section 57 and Section 65 
to test the strike extension of the gold mineralization intersected on 
Section 61 in 2006 and 2007. All holes completed in the second quarter 
intersected broad zones of intense shearing and alteration. Analytical 
results for these diamond drill holes are pending.

During the quarter, 1,674 m of trenching was completed on the northwest
side of the West zone to test the interpreted northeast strike extension 
of a new zone of oxide gold mineralization located in the pit by ongoing 
mining operations. All trenches bottomed in oxide material and analytical 
results for these trenches are pending.

b) East Zone

During the second quarter, the analytical results for the Reverse Air
Blast circulation ("RAB") drilling completed in two areas surrounding the 
East zone of the Uzboy gold deposit during the first quarter 2007 were 
received. The first area drilled is located approximately 200 m north 
of the current mining operation. The RAB drilling in this area resulted 
in the discovery of two new zones of oxide gold mineralization that ranged 
from 125 to 175 m in length and from 10 to 40 m in width and are open along 
strike and at depth. Gold values for the sample intervals from within these 
two zones ranged from 0.2 g/t to 4.39 g/t gold.

The second area of RAB drilling is located immediately southeast of the
current open pit mining operations. Three significant zones of oxide gold
mineralization have been defined in this area and are interpreted to be an
extension of the oxide gold mineralization previously outlined in the East
Zone of the Uzboy gold deposit. The largest of the three zones measures 460 m
long and is up to 140 m in width. The limits of the oxide gold mineralization
in all three zones are open along strike and at depth. On several profiles,
the oxide gold mineralization is open to the northwest. The gold values for
the sample intervals within the three zones ranged from 0.2 g/t to 29.7 g/t.
Diamond drilling of these zones is planned in the third quarter of 2007 to
determine if the Inferred oxide mineral resource estimated by Howe in the
Updated Report can be upgraded to either a Measured or Indicated oxide 
mineral resource.

The Updated Report prepared by Howe estimated that approximately 186,000
ounces of gold (8.735 million tonnes at an average grade of 0.67 g/t)
classified as an Inferred mineral resource is contained in the oxide portion
of the East zone of the Uzboy gold deposit. Inferred mineral resources have a
greater amount of uncertainty as to their existence and as to whether 
they can be mined legally or economically. It cannot be assumed that all 
or any part of the Inferred mineral resource will ever be upgraded to the 
Measured or Indicated mineral resource categories. Mineral resources that 
are not mineral reserves do not have demonstrated economic viability.

Metallurgical test work completed in the second quarter by SGS Lakefield
Research Europe on two representative samples of the sulphide (Primary) gold
mineralization from the West and East zones of the Uzboy gold deposit have
yielded encouraging results. Gold recovery rates for the samples from the 
West zone were 88.6% and 91.8% and 90% and 94% for the East zone. These gold
recovery rates were achieved by grinding the sulphide gold mineralization to
minus 325 mesh and leaching for a period of 48 hours. The preliminary
metallurgical test work shows that the sulphide gold mineralization in both
the West and East zones of the Uzboy gold deposit exhibit similar leaching
characteristics with respect to leach times and percentage gold recovery.
Based on these similar leach characteristics, it appears that the gold
mineralization from both zones could be treated in the same facility.
Additional testing of representative samples of sulphide gold mineralization
from both the West and East zones of the Uzboy Gold deposit is planned for 
the balance of 2007. The additional test work will provide data which will 
be used to design a preliminary process flow sheet for use in a 
Pre-Feasibility Study.

c) Uzboy Extension

During the second quarter the Corporation received analytical results for
the 1,875 m of RAB drilling completed during the first quarter in the Uzboy
Extension that returned several sporadic low gold values. Geophysical surveys
(Induced Polarization/Resistivity ("IP") and total field magnetometer) are
planned for this portion of the Uzboy extension in the third quarter of 2007.
On completion of these surveys, all geochemical and geophysical data will be
compiled and utilized in planning the next phase of exploration for the Uzboy
Extension.

2 Aygabak Zone

The Corporation commenced exploration of this zone during the second
quarter completing 3,858 m of trenching and 1,994 m of RAB drilling. The
trenching and RAB drilling activities on this zone are expected to be
completed in the third quarter. The exploration is designed to test this
target for gold and base metal mineralization located prior to 1991.
Analytical results for the trenching and RAB drilling completed during the
second quarter are pending.

3 Shirotnaia Zone

The Shirotnaia zone is located 3 kms northeast of the Aksu and Quartzite
Hills gold deposits. Although, the gold mineralization in these gold deposits
is not necessarily indicative of the gold mineralization in the Shirotnaia
zone, the geology and structures that hosts these two gold deposits are
interpreted to extend northeast towards the Shirotnaia zone.

During the first quarter 2007, 18 diamond drill holes totaling 2,117 m
were completed over a strike length of 1,400 m to test the depth extent of 
the gold mineralization outlined by the 2005 and 2006 trenching programs.
Seventeen drill holes intersected multiple intervals of significant gold
mineralization (greater than 0.2 g/t in each hole). The mineralized intervals
range in thickness from 2.0 to 73.0 m and extend from surface to a depth of
125 m on Section 28. The mineralized intervals in all 17 holes are open along
strike and at depth.

The gold mineralization is hosted in metasomatically
(sericite-pyrite-quartz) altered dacite and andesite and is interpreted to be
controlled by the northeast trending Aksuyski fault zone. The upper portions
of the mineralized intervals are oxidized to an average depth of 25 m.
Underlying the oxidized zone, the mineralized intervals are characterized by
fine grained disseminated pyrite and pyrite veinlets (pyrite content ranges
from 1% to 7%) and quartz-carbonate veining.

The preliminary interpretation of the diamond drilling results is that
the gold mineralization intersected (minimum strike length of 300 m) in the
southwest part of the zone is the strike extension of the gold mineralization
(approximately 320 m long) located in the northeast part of the zone. These
two areas of gold mineralization are separated by a distance of 710 m.
Trenching completed over this 710 m long section of the Shirotnaia zone has
intersected significant intervals of gold mineralization.

The mineralization in the northeast portion of the zone is the most
significant intersected to date with respect to average gold grade and width
of mineralization. DDH C-282 completed in this area was terminated in
significant gold mineralization at a depth of 142.8 m with the last sample in
this hole yielding a gold grade of 1.33 g/t.

Representative samples of the oxide gold mineralization have been
submitted for bottle roll and column leach tests to determine the amenability
of the oxide gold mineralization to leaching using cyanidization. The results
of the bottle roll and column leach tests are expected during the third
quarter of 2007.

Further exploration of this zone includes a combination of diamond, RAB
and Hydro-core lift ("KGK") drilling planned for later in 2007 when drier
ground conditions are expected.

4. Mamay Zone

The analytical results for 17 diamond drill holes completed over a strike
length of 720 m to test the down dip extension of a large zone of gold-silver
mineralization outlined in 2005 and 2006 by surface trenching programs were
received in the second quarter of 2007. This zone is characterized by a very
limited zone of oxidation that extends to an average depth of 12 m below
surface. Distinct zones of low grade gold-silver (up to 37.5 m wide) and low
grade copper-lead-zinc-gold-silver mineralization (up to 6.5 m wide) occur in
a broad zone of pyritic, sheared and brecciated altered andesite.

The precious and base metal potential of Mamay is supported by the
combination of the gold-silver and copper-lead-zinc-gold-silver
mineralization, the geology and the kilometer strike length of this
prospective target. The next phase of exploration planned for this zone
consists of ground geophysical surveys (IP and total field magnetometer) to 
be completed in 2008.

CAPITAL EXPENDITURES

Expenditures on mining assets for the three months ended June 30, 2007
totaled CDN$1.9 million. Of this total, CDN$1.1 million was spent as part 
of the CDN$5.5 million exploration program planned for 2007. An additional 
CDN$0.8  million was spent on machinery and equipment both at the new resin 
stripping plant and the Uzboy mine site.

MANAGEMENT DISCUSSION AND ANALYSIS ("MD&A") and FINANCIAL RESULTS

A full MD&A and Financial Report of the Second Quarter of 2007 is
available on the Corporation's website, can be obtained on application from
the Company and is available under the Corporation's profile on SEDAR at
http://www.sedar.com.

Elmer B. Stewart, MSc. P. Geol., President of Alhambra, is the
Corporation's nominated Qualified Person responsible for monitoring the
supervision and quality control of the programs completed within the Uzboy
Project. Mr. Stewart has reviewed and verified the technical information
contained in this news release.

Alhambra is a Canadian based gold exploration and production corporation
celebrating its sixth year of operations in the Republic of Kazakhstan. It is
engaged in the exploration and production of gold properties from its 100%
owned Uzboy Project.

Alhambra shares trade in Canada on The TSX Venture Exchange under the
symbol ALH and in Germany on the Frankfurt Open Market under the symbol A4Y.
The Company's website can be accessed at http://www.alhambraresources.com

The TSX Venture Exchange Inc. has neither approved nor disapproved 
the information contained herein.

This news release contains forward - looking information including but
not limited to comments regarding the timing and content of upcoming work
programs, geological interpretations and potential mineral recovery 
processes. Forward - looking information includes disclosure regarding 
possible future events, conditions or results of operations that is based on 
assumptions about future economic conditions and courses of action, and 
therefore, involves inherent risks and uncertainties. For any forward 
looking information given, management has assumed that the analytical 
results it has received are reliable, and has applied geological 
interpretation methodologies which are consistent with industry standards. 
Although management has a reasonable  basis for the conclusions drawn, 
actual results may differ materially from  those currently anticipated in 
such statements. For such statements, we  claim the safe harbor for future.