Inmet Mining Announces Option Agreement with LS-Nikko to Invest in Cobre
Panama Project

TORONTO, Oct. 28 /CNW/ - Inmet Mining Corporation (Inmet) (TSX:IMN) announced today that it has entered into an option agreement (Option Agreement) with LS-Nikko Copper Inc. (LS-Nikko) under which LS-Nikko has the right to acquire a 20 percent interest (Option Interest) in the Cobre Panama copper project in Panama (Project). If LS-Nikko exercises the option, it will receive an equity interest in Minera Panama, S.A. (MPSA), owner of the Project. LS-Nikko may, prior to January 31, 2010, elect to increase the Option Interest to 30 percent.

LS-Nikko is holding the option through a wholly-owned subsidiary, Korea Panama Mining Corp. (KPMC). LS-Nikko has guaranteed KPMC's obligations under the Option Agreement and Korea Resources Corporation (KORES) will provide financial support to KPMC. The Option Agreement contemplates that KORES may in future become an equal shareholder of KPMC with LS-Nikko.

During the option period, KPMC and Inmet will fund their respective proportionate shares of MPSA's development costs to a maximum of US$150 million, and Inmet will fund MPSA's development costs in excess of US$150 million. Assuming MPSA incurs US$150 million of development costs during the option period, KPMC's non-refundable share would be US$30 million with a 20 percent Option Interest or US$45 million with a 30 percent Option Interest.

The option will be exercisable for a 60 day period after Inmet has publicly announced a decision to proceed with construction and development of the Project. Should the option be exercised, KPMC must invest in MPSA an amount that will be its proportionate share of Inmet's US$501 million investment in MPSA. Such proportionate share will be approximately US$125.5 million if the Option Interest is 20 percent and US$215 million if the Option Interest is 30 percent. In addition, KPMC would also invest in MPSA its proportionate share of MPSA's development costs during the option period, if any, that are in excess of US$150 million.

Assuming the option is exercised, Inmet, LS-Nikko, KPMC and MPSA will enter into a shareholders' agreement containing usual and customary terms to govern the affairs of MPSA and their relationships amongst each other, the essential terms of which have already been agreed to by them. Among other things, the terms will address financing of the Project and governance of MPSA. In addition, Inmet would continue to oversee development and operation of the Project. MPSA and LS-Nikko will also enter into, on terms to be negotiated, an offtake purchase agreement on closing of the option under which LS-Nikko would be entitled to purchase, pro rata to the Option Interest, a share of MPSA's concentrates production, subject to LS-Nikko arranging for related financing.

Forward looking information

Securities regulators encourage companies to disclose forward-looking information to help investors understand a company's future prospects. This press release contains forward-looking information. These are "forward-looking" because we have used what we know and expect today to make a statement about the future. Forward-looking statements usually include words such as may, expect, anticipate, and believe or other similar words. Capital and operating cost estimates are forward-looking statements, and are based on assumptions that we believe to be reasonable. However, actual events and results could be substantially different because of the risks and uncertainties associated with our respective business or events that happen after the date of this press release. You should not place undue reliance on forward-looking statements.

About Inmet

Inmet is a Canadian-based global mining company that produces copper, zinc and gold. We have interests in five mining operations in locations around the world: Cayeli, Las Cruces, Pyhasalmi, Troilus and Ok Tedi. We also have a 100 percent interest in Cobre Panama, a development property in Panama.

This press release is also available at www.inmetmining.com.

About LS-Nikko

LS-Nikko is one of the world's leading mining and smelting companies and owns the Onsan copper smelter and refinery in Korea, which has an annual capacity of 560 thousand of copper cathodes and is unique in utilizing both the Outokumpu and the Mitsubishi smelting technology. LS-Nikko has interests in exploration and development stage projects: Boleo, Rio Blanco, Marcona, and Corocoro. Deloitte Corporate Finance acted as financial advisor to LS-Nikko and KPMC.

About KORES

KORES was incorporated in 1967 and it has since contributed to the national economic development of Korea by supplying stable energy and industrial mineral resources. KORES is especially focused on securing a supply of bituminous coal, uranium, iron, copper, zinc and nickel which the Korean government has selected as the six strategic minerals.

SOURCE INMET MINING CORPORATION

For further information: For further information: Inmet: Jochen Tilk, President and Chief Operating Officer, (416) 860-3972

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INMET MINING CORPORATION

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