Mandalay Resources Corporation Announces Option Agreement to Acquire 100%
Interest in the El Caballo Blanco Mineral Property

VANCOUVER, Dec. 1 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX-V: MND), is pleased to announce that it has been granted an option to acquire a 100% interest in the El Caballo Blanco Mineral Property (the "Property") for a sum of up to US$2 million in cash.

Located along the Atacama Fault north of La Serena, Chile, the El Caballo property is 8 km south of the iron ore producing El Tofo mine, and 5 km east of the historic Higuera copper-iron district. El Caballo is being acquired for its potential to host magnetite, copper oxide, and copper sulfide deposits close to existing infrastructure in a mining-friendly region.

The Property contains outcropping copper oxide mineralization coincident with strong magnetic and IP anomalies measuring approximately 2 x 5 km in plan. Historic drilling by previous optionors has intersected highly anomalous iron and copper mineralization over significant widths (approximately several tens to 200 metres) in several holes.

    Option payments and work commitments are as follows:

    -   A sum of US$250,000 due on or before the earlier of 6 months after
        the TSX Venture approval of the option agreement ("Effective Date")
        or October 17, 2010;
    -   A sum of US$250,000 due on or before 12 months after the Effective
        Date with a work commitment of 10 RC holes (4,000 metres);
    -   A sum of US$250,000 due on or before 18 months after the Effective
    -   A sum of US$1 million due on or before 24 months after the Effective
        Date; and
    -   A work commitment of 10 RC holes (4,000 metres).
    -   At Mandalay's election, the $1 million due on or before 24 months
        after the Effective Date can be extended for another 12 months for a
        payment of $250,000.

Bradford Mills, Chief Executive Officer commented: "We are pleased to add an exploration target of this quality to our pipeline of exploration and development projects in Chile and Australia. With its significant geophysical anomalies coincident with mineralized outcrops and intercepts in historic drilling, this property is one that Mandalay can test quickly and definitively."

    About Mandalay Resources Corporation:

Mandalay Resources is a Canadian-based natural resource company with assets in production. The Company is focused on executing a roll-up strategy which involves aggregation of gold, copper, silver and antimony projects, creating critical mass through the acquisition of near-term or in-production assets in Australia and the Americas.

    Forward-looking statements:

Certain statements contained herein constitute "forward-looking statements". These forward-looking statements are based on current expectations. The nature, timing and extent of the operations at the Company's projects may materially change from current intentions for a number of reasons. Additionally, forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "may," "estimates," "expects," "indicates," "targeting," "potential" and similar expressions. These forward-looking statements, including statements regarding the Company's beliefs in the potential mineralization, are based on current expectations and entail various risks and uncertainties. Actual results may materially differ from expectations as more information regarding the property is gathered or if known and unknown risks or uncertainties affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. The Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

SOURCE Mandalay Resources Corporation

For further information: For further information: Bradford Mills, Chief Executive Officer, Greg DiTomaso, Investor Relations, Contact: (647) 436-2592

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