Linux Gold Corp. Announces a Drilling Contract is Signed for Granite Mountain to Commence the $1.4 Million Exploration Program, Nome, Alaska.

VANCOUVER, British Columbia -- Linux Gold Corp. (OTCBB:LNXGF) wishes to announce that a minimum of 3,000 linear feet has been contracted for drilling on the Granite Mountain property, 160 miles from Nome, Alaska, with Diamond Drilling Consultants, LLC.

The drilling, with depths averaging 500 feet, is to commence during the fourth week of July, 2006.

Drilling will test four main mineralized targets which indicates gold-silver-copper/lead-zinc-silver/gold-copper-bismuth/ molybdenum-copper-gold-uranium prospects. An exploration program budget of $1.4 million is planned for this year's program on the Granite Mountain property.

About Linux Gold Corp.

In March of 2005, Linux Gold Corp. staked 148 State of Alaska 160-acre MTRSC mining claims at several locations near Granite Mountain on the eastern Seward Peninsula of Alaska. See news release dated October 26, 2005, for details.

Linux Gold Corp. also owns a 50% interest in 30 mineral claims known as the Fish Creek Prospect, located in the Fairbanks Mining Division in Alaska. Linux Gold Corp. optioned to Teryl Resources Corp. (TSX VENTURE:TRC) a 50% interest in the Fish Creek claims by expending US$500,000 over three years. Linux Gold Corp. retains a 5% net smelter return or may convert into a 25% working interest. The Kinross Fort Knox mill is within 6 miles from the Fish Creek claims.

Linux Gold Corp. received a research report from Khandaker Partners in New York. The report can be accessed online at http://www.linuxgoldcorp.com/khandakerreport_062706.pdf (see news release dated June 28, 2006).

For more information please visit www.linuxgoldcorp.com.

ON BEHALF OF THE BOARD OF DIRECTORS

"John Robertson"

John Robertson

President

Forward-Looking Statements

This release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We use words such as "anticipate," "believe," "expect," "future," "intend," "plan," and similar expressions to identify forward-looking statements. Forward-looking statements include, without limitation, our ability to increase income streams, to grow revenue and earnings, and to obtain additional cord blood banking revenue streams. These statements are only predictions and are subject to certain risks, uncertainties and assumptions, which are identified and described in the Company's public filings with the Securities and Exchange Commission.