Sulliden Exploration Inc.: The Supreme Court Of Peru Issues Directive To Superior Courts To Support Arbitration.

MONTREAL -- In an effort to keep its shareholders apprised of developments relating to the recent Arbitrational suspension, Sulliden Exploration Inc. (TSX:SUE) reports that on July 12, 2005 the Supreme Court announced an official directive addressed to the Presidents of the twenty-eight Superior Courts throughout the nation to uphold the sanctity and constitutional autonomy of the Institution of Arbitration.

The directive was precipitated by recorded instances of illegal obstructions to the Arbitration Process imposed by certain magistrates which have resulted in unnecessary conflicts, one such measure having halted Sulliden's Arbitration process on June 8, 2005 by the Judge of Villa Maria del Triunfo as it was entering its final stage.

The Supreme Court unequivocably validates the Institution of Arbitration as a constitutionally defensible instrument to resolve controversy, being autonomous in its own procedural regulations and guaranteed to be free of outside intervention.

The Transfer Agreement, which was signed in good faith and common intention between Sulliden, through its wholly-owned subsidiary Minera Sulliden Shahuindo S.A.C. ("Sulliden"), and Compania Minera Algamarca S.A. and its subsidiary Compania de Exploraciones Algamarca S.A., ("Algamarca") and notarized and filed in the public registry in Lima in November 11, 2002, provided for the resolution of dispute by Arbitration. Sulliden invoked the arbitration clause and in January 2004 the Arbitration Tribunal was formally installed. While the new shareholders of Algamarca filed an objection to the process at the beginning of the proceedings, the objection was rejected and the Arbitration Proceedings continued with the active involvement of both parties.

The new Algamarca shareholders initiated court proceedings in an attempt to stop the Arbitration Process and obtained a court order for its suspension. The Arbitration Tribunal chose to uphold the constitutional autonomy of the Arbitration Process and continued with the proceedings. However, a further constitutional court order was sought and obtained through the Judge of Villa Maria del Triunfo directing the Arbitrators to suspend the process which resulted in the aforenoted temporary suspension pending Superior Court review of the order.

Sulliden is hopeful that the Supreme Court decision of June 15, 2005, confirming the constitutional autonomy of the Arbitration Process, together with this most recent directive, will result in the early resumption of the Arbitration Process.

The concern over the future of the Arbitration Institution as it is recognized in the Constitution of Peru has been unifiedly expressed by the most respected and powerful organizations across Peru including: The respective Chambers of Commerce of Lima, Canada-Peru and the United States; The National Institute of Mining, Petroleum and Energy Law; The Center for Analysis and Resolution of Conflicts of the Pontifical Catholic University of Peru; and The National Confederation of Private Companies (CONFIEP). A copy of this communique is available on Sulliden's website at www.sulliden.com.

Certain of the information contained in this news release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include without limitation, statements regarding estimates of reserves and resources, future plans and objectives, results of exploration, uncertainty with respect to changes in general economic or political conditions, title to properties, litigation, legislative, environmental and other judicial, regulatory and competitive developments in areas in which the Company operates. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Sulliden's expectations are disclosed under the heading "Risk Factors" in its 2004 Annual Report as well as in its Annual Information Form (AIF) both of which are filed with Canadian regulators on SEDAR.

SULLIDEN EXPLORATION INC. (TSX:SUE)