Brilliant Mining Corp.
TSX VENTURE : BMC

Brilliant Mining Corp.

May 12, 2006 09:15 ET

Brilliant Mining Closes $10.3 Million Private Placement

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 12, 2006) -

Not for dissemination in the United States or for release to U.S. newswire service.

Brilliant Mining Corp. (TSX VENTURE:BMC) (the "Company") is pleased to announce that the brokered private placement through a syndicate of agents led by Pacific International Securities Inc., and including Canaccord Adams and Dundee Securities Corporation (the "Agents") has now closed. The Company has issued a total of 12,902,750 subscription receipts at a price of $0.80 per subscription receipt for gross proceeds of $10,322,200, which subscription receipts are exchangeable into units (the "Units") of the Company. Upon the exchange of all of the subscription receipts and the release of the subscription proceeds from escrow, the Company will issue 12,902,750 units at a price of $0.80 per unit. Each Unit will consist of one common share and one half of one common share purchase warrant with each whole warrant exercisable into one common share for two years from the closing date at a price of $1.05.

The net proceeds of the placement will be used to fund working capital, exploration and the cash portion of the Donegal Resources Pty. Ltd. ("Donegal") acquisition. Donegal holds a 25% interest in the Tramways Tenements, host to the producing Lanfranchi Nickel Mine. Proceeds from the financing will be held in escrow until closing of the acquisition by the Company of Donegal, which is scheduled for late May of 2006. Upon satisfaction of the release conditions, the subscription receipts will be deemed exercised into Units, and the Company will receive the proceeds net of agents' fees. If the release conditions are not satisfied on or before June 30, 2006, all purchasers of subscription receipts will have the option to have their subscription receipts repurchased by the Company or exchanged into Units.

"The proceeds will provide us with the resources to aggressively pursue our goal to optimize returns through increased production, convert existing Resources to Reserves and identify new resources at the Tramways Tenements" states Brilliant Chairman John Robins.

Tramways Tenements Project

The Tramways Tenements consist of 37 mineral leases over 50 km squared and host to the producing Lanfranchi Nickel Mine. The Tramways Tenements are located in the world-class Kambalda Nickel District in Western Australia that has produced over 1,000,000 tonnes of nickel metal (35Mt @ 3% Ni) with the Lanfranchi Mine being one of the most significant, producing around 10% of the total nickel metal from the district. Historic production at the Lanfranchi Mine has totaled 3.17Mt at an average grade of 3.18% Ni (100,900 tonnes of nickel metal) over 14 years of underground mining from 1987 to 2002.

The first ore was delivered from the newly developed high-grade Helmut South ore body in September 2005 with production 'ramp up' currently on track to attain target levels. Along with the increase in production from Helmut South, the Lanfranchi JV composed of Donegal 25% and Sally Malay Mining Ltd. (SMY:ASX) 75%, has commenced work on a detailed mine plan, optimum mining method and costing studies to potentially access ore from two additional deposits. The proposed ore material sourced from the Winner ore body and Schmitz Extension resource if developed could see nickel production levels from the Lanfranchi Nickel Mine increase significantly from as early as the second half of 2006 onwards.

Acquisition Terms

Brilliant plans to acquire the issued and outstanding shares of Donegal Resources Pty. Ltd., a private Australian company. The consideration to be paid by Brilliant to the Vendors consists of: (1) CDN$5 million cash; (2) the issuance of 10,500,000 units, each unit consisting of one Common Share and one-half of a share purchase warrant and (3) the issuance of a CDN$5 million unsecured convertible debenture that matures in three years. The agreement remains subject to a number of conditions including regulatory approvals, satisfactory completion of due diligence by Brilliant and the execution of a definitive formal agreement.

Upon closing of the Acquisition and release of the funds from escrow, the Company will pay the Agents a commission of 8.0% of the gross proceeds of the offering, payable in a combination of cash or Units, at the election of the Agents. In addition, the Agents will receive compensation options equal to 10.0% of the Units sold, with each compensation option exercisable into one common share at a price of $1.00 for two years from closing. Pacific International was paid a corporate finance fee of $20,000 and was reimbursed for its expenses.

The subscription receipts, the common shares and warrants comprising the Units, including those issued to the Agents in payment of the Agents' commission described above, the common shares issuable upon exercise of the warrants and upon exercise of the Agent's compensation options will be subject to a restricted period expiring on September 11, 2006.

The project is supervised by John Williamson, PGeol., chief executive officer and director of Brilliant, the qualified person as defined in National Instrument 43-101.

Brilliant Mining Corporation (BMC:TSXV) is focused on the identification, exploration, and development of nickel opportunities world wide. Brilliant currently has 3 active nickel projects in Canada including the Michikamau property in western Labrador.



On behalf of the Board of Directors

"Mike Sieb"

Mike Sieb, B.Sc., MBA - President
Brilliant Mining Corporation


This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.



The TSX Venture Exchange has not reviewed and does not take responsibility for the adequacy or accuracy of this release.

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