Dear Shareholders, 

The Shumagin Corporations 34^th Annual Shareholders Meeting was held on January 5, 2008. The seats up for election this year were those of Glen Gardner Jr., Peter Devine Jr. and Wayne Gundersen.

The candidates were: Glen Gardner Jr. and Peter Devine Jr. out of 39,211.1739 shares that were entitled to vote 20,928.642 shares were voted in proxy and at registration which was held from 5:00 p.m. to 6:30 p.m. prior to the Annual Meeting which started at 7:00 p.m.

The Election results were as follows:

Glen Gardner Jr.           31,957.44175

            Peter Devine Jr.            21,529.7604

            Wayne Gundersen        4,964.2854

Congratulation’s to Glen Gardner Jr., Peter Devine Jr. and Wayne Gundersen!

            Proxy Drawing Winners

Jillian Bjornstad                        $1,500.00

Patricia Olsen                           $1,000.00

Alma Bolton                             $   500.00

Gerald D. McGlashan               $   250.00

Richard P. Gilbert Jr.                $   250.00

Glen F. Nelson                         $   250.00

Marie E. Osterback                  $   250.00

Door Prizes

Peter Gronholdt                        $100.00

Walter Osterback                     $100.00

Marita Gundersen                     $100.00

Frances Larsen                         $100.00

Diana Mack                             $100.00

Douglas Holmberg                    $100.00

Susan McGlashan                     $100.00

Arleen Gardner                         $100.00

Ingrid Cumberlidge                   $100.00

Immediately following the 34^th Annual Shareholders Meeting the Board of Directors held a meeting to elect officers.

            Arleen M. Gardner       - President

            Peter Devine Jr.            - Vice-President

            Dennis McGlashan Sr.  - Secretary/ Treasurer

To all the Shareholders that attended Shumagin 34^th Annual Meeting and to those who submitted your proxies Thank You!

Sincerely,

Arleen M. Gardner

President

Shumagin 2005-2007

Western Marine Construction is still managing Shumagins knoll Quarry. Shumagin has extended their termination date from November 17th, 2007 to November 17, 2008. The US Army Core of Engineers may be interested in acquiring a large amount of rock for a future project in our region. Currently Western has shut down their operation for the winter months and will start up again in the Spring.

This year the Bear Seasons are back to back with a Fall and Spring Hunt. Currently Shumagin hold's three 3-year leases with Litzen Guide Service, Canoe Bay Outfitters, and Alaska Statewide Guides.

The Shumagin Corporation is holding a 2007 Buffalo Hunt. The Board of Directors allocated 25 buffalo for a local Hunt, with fifteen being Shareholder preference. The hunt is from November 1st thru December 31st, 2007. As in every hunt successful hunters are required to donate thirty pounds of meat to designated elders. Three Buffalo are also available for Big Game Hunters. If interested call the Shumagin Corporation at 907-383-3525.

Shumagins Scholarship Program this year four scholarships in the amount of $2,500.00 were awarded to the following students: Jacole Mack, Thea Gundersen, Rosanne Wilson and Dylan Jacobsen.

Kay Erben and Ralph Eluska with the Borough of Land Management flew out to Sand Point in September of 2007 and the Corporation finished prioritizing their remaining 12A and 12B land selections.

The three Tribes located in Sand Point and the City of Sand Point worked together with Santina Gay, Santina is the Alaska Tribal Coordinator located in Anchorage, Alaska, who oversees IGAP's funding to the three tribal Governments in Sand Point. The Tribes received grant money's for the Oil Drum Clean-up Project and the City of Sand Point donated funding and labor. There were a total of 580 drum's stored in the pit across from the knoll Quarry. In August of 2007 the majority of those drums were removed they are currently working on another Grant to send the remaining 35 drums out of Sand Point. There is still some testing to do on oil tanks, contents of the drums and soil testing at the site. Then the City of Sand Point will begin the final step in the clean-up. Thanks to the Qagan Tayagungin Tribe, Pauloff Harbor Tribe, Unga Tribe and the City of Sand Point.

The Corporation did have a cruise ship the Clipper Odyssey visit the Shumagin Corporations Petrified Forest on Unga Island. We had a total of 109 tourists and staff visit the Petrified Forest this past summer. The Corporation has a set fee of $35.00 per person and they are required to hire an observer from Shumagin to be present during their visit. All proceeds go towards the Shumagin Scholarship Fund.

In 2005 Aleutian Housing Authority purchased seven lots from the Shumagin Corporation in the Meadows Subdivision. This year Aleutian Housing Authority has completed four homes in Sand Point and is currently in the process of building a four plex. Sand Point has some happy new home owners.

Western Marine Construction is still managing Shumagin Knoll Quarry. Western has closed down their business for the winter months. In early spring of 2007 Western will continue on phase two of the boat harbor project which will consist of dredging and installing floats. It’s designed to provide moorage for thirty-five large fishing vessels, 125 feet or longer. Western Marine should have the project completed in the summer of 2007.

Shell Oil and Gas and Minerals Management Service visited Sand Point, Nelson Lagoon and Cold Bay. MMS held a hearing for public comments in the Aleutians East Borough Region on a Draft Environmental Impact Statement on September 28^th, 2006. This is in regards to the proposed five year plan from 2007-2012 for the Outer Continental Shelf Oil and Gas Leasing Program on the North Side.