GlobeStar Mining has declared commercial production as of January 1, 2009, at its 100%-owned Cerro de Maimon copper-gold-silver mine located in the Dominican Republic. The sulphide mill has been producing copper, gold and silver in concentrate at its design capacity since mid-November 2008 and the oxide plant has been in continuous production of gold-silver precipitate since mid-December 2008. Concentrate shipments commenced in early November and have continued on a regular basis through year end. This sustained level of mining, processing and sales activity has resulted in the declaration of commercial production.

Fourth quarter highlights:

• Production of approximately 5.1 Mlb of copper; 1,500 oz of gold and 120,000 oz of silver in 7,700 t of concentrate
• Shipment of 7,290 t of copper concentrate to smelters in China
• Proceeds received in December 2008 from fourth quarter concentrate shipments totalled $4.8 million, with a further $3.7 million in expected proceeds from fourth quarter shipments to be received in early 2009
• One-half of the 2% net smelter return royalty on the Cerro de Maimon mine was purchased for $1 million
• Copper concentrate inventories in excess of 1,900 tonnes at year end
• Construction of the production facilities was complete at year end except for work associated with the expanded surface water retention pond.

During the fourth quarter of 2008, the sulphide plant milled 89,800 t of ore grading 3.5% Cu. Copper recoveries in the sulphide mill were 75% during the quarter but averaged over 80% in December 2008 as operations were optimised. Concentrate grades averaged approximately 30% Cu, 5.9 g/t Au and 465 g/t Ag.

The oxide plant began operating in mid-December and is currently running at 75% of design capacity due to the higher than expected clay content in the oxide ore. Additional flocculent treatment capacity is being added to the oxide mill circuit to control the higher clay content of the ore and full production from the oxide plant is anticipated by the end of the first quarter of 2009.

Globestar has used a copper price of $1.50 per pound, a gold price of $700 per ounce and a silver price of $9.50 per ounce in developing this 2009 outlook. Copper production during 2009 from the Cerro de Maimon mine is expected to total approximately 29 Mlb from the processing of 475,000 t of sulphide ore grading on average 3.3% Cu. Gold and silver contained in the copper concentrate is forecast to total approximately 7,300 oz and 368,000 oz, respectively. During 2009, Globestar expects to sell a majority of its copper concentrates under sales contracts to overseas smelters. Discussions are underway to finalise the marketing contracts relating to the anticipated production in 2009.

The oxide plant is scheduled to process 245,000 t of oxide ore producing about 14,000 oz of gold and 280,000 oz of silver in dore. Gross revenue from the sale of approximately 27 Mlb of payable copper, 21,000 oz of payable gold and 614,000 oz of payable silver is projected to be $60 million. Operating earnings before depreciation, after $24 million of mine operation costs and $11 million of treatment, refining and freight charges, are forecast at approximately $25 million. Depreciation is projected to be approximately $10 million.

Globestar has hedged a portion of its 2009 production with synthetic put options on 6,322,850 lb of copper, 32,400 oz of gold and 480,000 oz of silver at $2.67/lb, $650/oz and $11.50/oz, respectively.

Net income, after $5 million in general and administrative costs, $11 million in derivative gains, $2 million of interest costs and $6 million in taxes, is forecast at approximately $13 million.

Cash flow from operating activities is projected to be approximately $26 million. Exploration and sustaining capital expenditures are scheduled to be approximately $4 million and $3 million, respectively. Cash out-flows for financing activities are forecast to be $14 million.

Exploration expenditures during 2009 will be focused on expanding the ore reserves of the Cerro de Maimon, drilling in the Bayaguana gold-copper district located some 40 km east of the mine, pursuing new exploration and acquisition opportunities in Mexico and Central America, and to a limited extent advancing Globestar’s nickel properties in the Dominican Republic.