Mandalay Resources Corporation Launches 91,000 Metre Exploration Program for 2011

TORONTO, Feb. 11 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX: MND, MND.WT) announced today that it has launched a board-approved exploration program for 2011 totaling US$11.7 million and 91,000 metres across its portfolio.

This program includes:

  • 43,600 metres (US$3.6 million) for infill drilling of currently inferred resources in and around the proven and probable reserves contained in the Dagny, Fabiola, Delia NW and Delia SE veins currently being mined or scheduled for mining at the Cerro Bayo Silver-Gold mine in Patagonia, Chile;
  • 17,300 metres (US$1.8 million) for step-out drilling along these same veins;
  • 12,000 metres (US$1.5 million) for initial drilling of the highest-priority new vein targets on the Cerro Bayo property;
  • 11,500 metres (US$2.1 million) for continuing drilling to infill and extend the Augusta ore shoot, currently being mined at the Costerfield Gold-Antimony mine in Victoria, Australia;
  • 4,000 metres (US$1.5 million) for initial drilling to confirm possible additional ore shoots in the Costerfield district; and
  • 2,900 metres (US$1 million) for target extensional and infill drilling at the La Quebrada Copper-Silver property near La Serena, Chile.

Brad Mills, Chief Executive Officer of Mandalay, commented, "Our principal goal is to significantly increase reserves, resources, and expected mine lives at Cerro Bayo and Costerfield by year-end 2011. We have demonstrated profitable mining at Costerfield and are about to achieve first revenue at Cerro Bayo, with the first shipment of silver-gold concentrate expected to go out on February 11, 2011.  With our anticipated strong cash flows at current metal prices, we can now embark on an aggressive exploration campaign, and execute on the "self-funded portfolio of growth projects" aspect of our strategy.  Our emphasis on headframe exploration around profitable mines means that we expect all of our holes to have high probabilities of intersecting attractive mineralized material, and each individual program represents a carefully planned set of holes to either enlarge measured, indicated, and inferred resources or drill test high-priority targets for entirely new resources. If the latter are successful, we anticipate having the financial capability to approve supplemental funding for rapid infill drilling later in the year."

Qualified Person:

Mark Sander, Chief Operating Officer of Mandalay Resources Corporation, who is a qualified person by being a member in good standing of the Australasian Institute of Mining and Metallurgy (AusIMM), has reviewed and approved the technical and scientific information pertaining to the 2011 Mandalay exploration program contained in this release.

About Mandalay Resources Corporation:
Mandalay Resources is a Canadian-based natural resource company with producing assets in Australia and Chile, and exploration projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.

Forward-Looking Statements:
This news release contains "forward-looking statements" within the meaning of applicable securities laws including, in particular, statements regarding the Company's proposed 2011 exploration program, expanding the mine life, and resource and reserve estimates of the Company's properties, the realization of first revenue from the Company's Cerro Bayo property, and the probability of drill-holes intersecting attractive mineralized material at the Company's properties. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, Mandalay's ability to complete the transactions described herein on the terms outlined, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. In addition, there can be no assurance that any inferred resources that are discovered as a result of additional drilling will ever be upgraded to proven or probable reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

SOURCE Mandalay Resources Corporation

For further information:

Bradford Mills
Chief Executive Officer

Greg DiTomaso
Investor Relations
Contact: 647.260.1566

Company website:

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Mandalay Resources Corporation

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