Hana Mining Ltd.
TSX VENTURE : HMG
FRANKFURT : 4LH

Hana Mining Ltd.

April 21, 2010 10:00 ET

Hana Mining Ltd.: Inferred Copper Resource Tonnage Estimate for Banana Zone Increases by 80.7%, With Cu Grade of 1.47%

Total Ghanzi Project Contained Cu Estimate-3.9 B Lbs, Plus Contained Ag Estimate-62.1 M Oz

Updated estimate now includes 93.2 Mt at 1.50% Cu and 18 g/t Ag, at a 0.75% cut-off, plus 83.8 Mt at 0.46% Cu and 3.58 g/t Ag, at a 0.30% cut-off for Chalcocite Zone

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 21, 2010) - Hana Mining Ltd., ("HMG" or the "Company") (TSX VENTURE:HMG)(FRANKFURT:4LH) is pleased to announce the completion of an updated independent National Instrument NI 43-101 compliant resource estimate for its Ghanzi sediment-hosted copper-silver project in Botswana. The new resource estimate represents a substantial increase in tonnes, at approximately the same copper grades as the previous June 2009 estimate.

The updated resource estimate was prepared by GeoLogix Mineral Resource Consultants (Pty) Ltd. of Potchefstroom, South Africa ("GeoLogix"). This estimate updates the previous resource estimate (HMG news release June 1, 2009) by GeoLogix, reflecting 8 months of drilling exclusively in the Banana Zone, and a new section at the southwestern end of the Banana Zone referred to as the Chalcocite Zone (sectors 35,000 to 45,000, see Figure 1 for location). Zones 5 and 6 were not drilled and consequently the resource estimates remain unchanged.

Highlights of the updated resource estimate:

  • The total Ghanzi Project April 2010 updated NI 43-101 mineral resource estimate now contains 3.9 billion lbs of copper and 62.1 million oz of silver, specifically:
    • 93.2 Mt at 1.50% Cu and 18 g/t Ag, at a 0.75% cut-off, containing 3.08 B lbs Cu, plus
    • 83.8 Mt at 0.46% Cu and 3.58 g/t Ag, at a 0.30% cut-off, containing 850 M lbs Cu in the Chalcocite Zone.
  • Our objective of doubling the size of the total mineral resource estimate for the Banana Zone has been met by this latest resource estimate.
    • Banana Zone (excluding the Chalcocite Zone) tonnage and contained copper has increased 80.7% over the previous estimate, with Cu grade unchanged at 1.47% Cu,
    • Banana Zone plus the Chalcocite Zone tonnage has increased 193.5%, and the contained copper estimate has increased 95% over the previous estimate, and
    • Banana Zone plus the Chalcocite Zone contained silver estimate has increased 96.1% over the previous estimate.

Table 1 below provides a summary of the updated April 2010 mineral resource estimate for the entire Ghanzi Project, and a comparison to the original June 2009 estimate.

                                 
                                 
                                 
    Table 1.       Ghanzi Sediment-Host Copper-Silver Project - All Zones - Inferred Resource   Table 3. Total Ghanzi Project Contained Metal Estimate
            April          June                                 April  
    Cu   2010 Estimate   2009 Estimate   % Change     Cu             2010 Estimate
    Cut-off tonnes Cu lbs Ag oz tonnes Cu lbs Ag oz tonnes Cu lbs Ag oz     Cut-off Cu lbs Ag oz
    (%) (millions) (billions) (millions) (millions) (billions) (millions) (millions) (billions) (millions)     (%) (billions) (millions)
                                 
  Banana Zone 0.75 73.5 2.382 45.95 40.6 1.317 28.33 80.7% 80.7% 62.2%   Banana Zone 0.75 2.382 45.95
  Zone 5 0.75 13.4 0.492 5.22 13.4 0.492 5.22 0.0% 0.0% 0.0%   Zone 5 0.75 0.492 5.22
  Zone 6 0.75 6.3 0.206 1.34 6.3 0.206 1.34 0.0% 0.0% 0.0%   Zone 6 0.75 0.206 1.34
  Subtotal   93.2 3.080 52.51 60.3 2.015 34.89 54.6% 52.9% 50.5%   Subtotal   3.080 52.51
                                 
  Chalcocite Zone 0.30 83.6 0.850 9.62 0 0 0 n/a n/a n/a   Chalcocite Zone 0.30 0.850 9.62
  Grand Total   176.8 3.930 62.13 60.3 2.015 34.89 193.2% 95.0% 78.1%   Grand Total   3.930 62.13

Table 2 below provides a summary of the updated April 2010 mineral resource estimate, specifically for the Banana Zone and Chalcocite Zone, showing resource tonnage and grade at various Cu cut-offs.

               
               
               
  Table 2.  Banana Zone Plus Chalcocite Zone Mineral Resources-At Various Cut-Offs - Inferred Resource
    Cu   Cu Ag     Contained Metal
    Cut-off tonnes Grade Grade Cu Ag
    (%) (metric) (%) (g/t) (B lbs) (M oz)
               
  Banana Zone 0.40 87,224,868 1.32 17.07 2.545 47.80
    0.60 78,180,602 1.42 18.72 2.451 47.00
    0.75 73,529,594 1.47 19.44 2.382 45.90
               
  Chalcocite Zone 0.30 83,620,159 0.46 3.58 0.850 9.60

Hana Mining's CEO and Chairman, Marek Kreczmer, commented as follows:

"This updated resource estimate is a very positive step for the Ghanzi Project, and culminates an 8 month drill program that has demonstrated the predictable nature of mineralization on the property. We focused exclusively on the Banana Zone, and have approximately doubled the tested strike length and the corresponding contained copper there since our last resource estimate.

Copper grades in the Banana Zone have remained identical to previous estimates, at 1.47% Cu. We have maintained our 0.75% cut-off in this estimate, although ongoing detailed mine planning is expected to result in a lower cut-off grade, which will increase the metal resource.

Chalcocite Mineralization:

The Chalcocite Zone, which contains over 0.85 billion lbs. of copper, has been treated as a separate resource in our tables, although it abuts the southern end of the Banana Zone. The Chalcocite Zone is primarily chalcocite and malachite, as opposed to the bornite and chalcopyrite found elsewhere on the Ghanzi property. The mineralization is much shallower, flatter, and typically thicker (up to 80 metres - see Figure 2), and will be amenable to bulk mining methods with low strip ratio and lower cost processing techniques. In fact, we see the grades & shapes quite comparable to other deposits in Southern Africa.

Our drilling program continues to be focused on the untested sections of the Banana Zone and the Chalcocite Zone. We have mining engineers developing a mining plan and metallurgists working on copper recovery methods and options for both the sulfide and oxide mineralization in the main Banana Zone as well as the chalcocite-malachite mineralization in the Chalcocite Zone. Environmental and hydrogeology work has also begun this quarter."

Discussion of Results:

The Company has focused on expanding the resource in the Banana Zone since the last resource estimate was completed and filed on SEDAR in June 2009. Almost all of the drilling has been reverse circulation (RC) drilling, with a small amount of diamond core drilling applied to metallurgy study work.

To view Figure 1, please click on the following link: http://media3.marketwire.com/docs/hat1.pdf

Drill results through most of the sectors in the Banana Zone continued to generate results consistent with prior drilling---bornite and chalcopyrite mineralization and copper grades that have left the Banana Zone Cu grade unchanged at 1.47% Cu at a 0.75% Cu cut-off.

Drill results in sectors 35,000 to 45,000 (see Figure 1 for locations)—what we now call the Chalcocite Zone - produced a different type of mineralization - predominantly chalcocite and malachite. Characteristics include, shallow depth to mineralization, shallow dip, and thicker widths of copper bearing minerals uniformly distributed. Mineralized thickness of 25-40 metres is fairly common, extending up to nearly 80 metres in certain areas. See Figure 2 for a cross section of mineralization in this Zone.

While this area demonstrated a copper grade (0.46% Cu at 0.3% cut-off), it also offers an opportunity for potential low cost bulk mining. The chalcocite/malachite mineralogy also offers the potential for treatment by proven, low cost copper leaching methods, reducing capital costs compared to conventional milling/flotation facilities. Metallurgy work is currently underway. The resource remains open to the southwest, and currently is estimated at 83.6Mt containing 850 M lbs of Cu.

A diagram of the mineralized horizon in the Chalcocite Zone can be seen in Figure 2 (http://media3.marketwire.com/docs/hat2.pdf).

Our updated NI 43-101 resource estimate now totals an estimated 3.9 B lbs of contained copper, based on the addition of sulphide mineralization from Banana Zone, Zone 5 and Zone 6 at a 0.75% cut-off, plus chalcocite mineralization from the Chalcocite Zone (sectors 35,000 to 45,000) at a 0.30% cut-off. Table 3 below illustrates this total estimate:

                                 
                                 
                                 
    Table 1.       Ghanzi Sediment-Host Copper-Silver Project - All Zones       Table 3. Total Ghanzi Project Contained Metal Estimate
            April          June                                 April  
    Cu   2010 Estimate   2009 Estimate   % Change     Cu             2010 Estimate
    Cut-off tonnes Cu lbs Ag oz tonnes Cu lbs Ag oz tonnes Cu lbs Ag oz     Cut-off Cu lbs Ag oz
    (%) (millions) (billions) (millions) (millions) (billions) (millions) (millions) (billions) (millions)     (%) (billions) (millions)
                                 
  Banana Zone 0.75 73.5 2.382 45.95 40.6 1.317 28.33 80.7% 80.7% 62.2%   Banana Zone 0.75 2.382 45.95
  Zone 5 0.75 13.4 0.492 5.22 13.4 0.492 5.22 0.0% 0.0% 0.0%   Zone 5 0.75 0.492 5.22
  Zone 6 0.75 6.3 0.206 1.34 6.3 0.206 1.34 0.0% 0.0% 0.0%   Zone 6 0.75 0.206 1.34
  Subtotal   93.2 3.080 52.51 60.3 2.015 34.89 54.6% 52.9% 50.5%   Subtotal   3.080 52.51
                                 
  Chalcocite Zone 0.30 83.6 0.850 9.62 0 0 0 n/a n/a n/a   Chalcocite Zone 0.30 0.850 9.62
  Grand Total   176.8 3.930 62.13 60.3 2.015 34.89 193.2% 95.0% 78.1%   Grand Total   3.930 62.13

Preparation of the Updated Mineral Resource Estimate:

This updated Ghanzi Project resource estimate is based on a total of 304 drill holes (41770.6 metres), drilled on 100-200 m spacing between holes.

Resource modeling was carried out using a three-dimensional solid geological model for each copper/silver bearing prospect, and grade estimation for blocks within a prospect using assay sample composites within the same prospect. Geological solids were created by wireframe models delineating the various lithological and grade contacts of each prospect in the drillholes. The Kalahari sand has been wireframed as a discrete layer. The model did not go below the 800 m elevation, maximizing depth below surface to 200-225 m. All geological modeling work was done by GeoLogix with Datamine software.

Based on the geological confidence, the integrity of the data, the spatial continuity of the mineralization as demonstrated by the variography, and the quality of the estimation, the entire resource has been classified as an inferred resource. An updated NI 43-101 mineral resource estimate on the Ghanzi Project will be available within 45 days on SEDAR at www.sedar.com.

Conference Call Wednesday, April 21st at 8:30am:

A conference call for parties interested in learning more about the Ghanzi property has been set up for Wednesday, April 21st at 8:30 a.m. Pacific Standard Time (11:30 a.m. Eastern Standard Time and 5:30 p.m. in Botswana). The moderators for the conference call are Marek Kreczmer (CEO) and Jim Sullivan (President).

The conference call may be accessed by dialing toll-free 1-877-240-9772 in Canada and the United States, or 1-416-340-8527 in the Toronto area and internationally or can be listened to in real time at www.hanamining.com. The conference call will be archived for later playback and may be accessed by dialing 1-416-695-5800 or 1-800-408-3053 and entering the pass code 7236242, or via www.hanamining.com. The archived playback will be available until May 5, 2010 11:59 p.m.

Qualified Person and Quality Assurance/Quality Control:

Joseph Arengi, M. Sc., P. Geo., Vice President of Exploration for Hana Mining is the qualified person as defined in NI 43-101 and has reviewed the technical information in this press release.

The Company has implemented an industry-standard QA/QC program. For diamond drill samples, core is logged, split by sawing, and sampled by Company staff at site. For RC drill samples, a 35-40 kilogram sample is collected from the cyclone discharge at 1 metre intervals. RC samples are then split 75/25; 75% of the sample is archived and the other 25% provides material for analysis. All samples (both core and RC) are double bagged, sealed and transported in secured wooden crates and shipped to Scientific Services Laboratory in Cape Town, South Africa. Standards, duplicates and blanks are inserted into the sample stream. The analytical method for the total Cu, Ag, Pb, and Zn is acid digestion and Atomic Absorption Spectroscopy ("AAS"). The analytical method for soluble Cu is 5% sulfuric acid cold leach followed by AAS. The analytical method for Mo assays is XRF (full matrix correction).

About Hana Mining's Ghanzi Copper-Silver Project in Botswana:

The Ghanzi Project is located in the center of the Kalahari Copper Belt in northwestern Botswana. The Ghanzi property covers 2,169 sq. km., and contains sediment-hosted copper-silver deposits with a demonstrated cumulative tested strike length of 37.6 kilometres in all drilled zones. The copper bearing horizon extends over the entire strike length of 600 kilometres, thus only 6% of the total potential has been tested to date. Hana Mining released results of its second NI 43-101 resource estimate for the Ghanzi Project in April 2010, announcing an inferred resource as follows;

  • 3.08 billion lb Cu and 52.5 million oz Ag from 93.2 Mt, based on 0.75% cut-off grade, averaging 1.50% Cu and 18.00 g/t Ag, from Banana Zone, Zone 5 and Zone 6, and
  • 850 million lb Cu and 9.6 million oz silver from 83.6 Mt, based on a 0.3% cut-off grade, averaging 0.46% Cu and 3.58 g/t Ag, from the Chalcocite Zone.

The Banana Zone exhibits certain areas of high grade Cu and Ag mineralization, particularly in sectors 25,000, 5,000 and 70,000 (see Figure 1), which represent an opportunity to locate starter pits and mine initial tonnages at higher than average grades. These higher grade pockets tend to be well within open pit depth parameters and represent opportunities to improve early cash flow and overall returns in development.

The project will benefit from contemplated rail/power infrastructure expansions, along with proximity to local population centers and workforce. A feasibility study is currently underway (funded by the World Bank and the governments of Botswana and Namibia) to support completion of a rail line link that would connect Botswana with the Namibian port of Walvis Bay, on the Atlantic coast. The closest existing railhead (to port) is at Gobabis, in Namibia, approximately 550 km from our property. A planned 600MW expansion of the government-owned Moropule Power Plant continues to advance, with US$825 million project funding secured in May 2009, and key supply contracts awarded. Currently, our project is served by the paved Trans-Kalahari highway, which passes within 15 km of the property.

Hana Mining is focused on demonstrating that the Ghanzi property represents one of Africa's premier future copper-silver resources.

Statements in this press release, other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, may include forward-looking statements. Forward-looking statements are based on numerous assumptions and are subject to all of the risks and uncertainties inherent in resource exploration and development. As a result, actual results may vary materially from those described in the forward-looking statements.

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

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