Hana Mining Ltd.

Hana Mining Ltd.

January 20, 2010 09:00 ET

Hana Mining RC Drilling in Banana Zone Intersects 1.21% Cu and 16.8 g/t Ag Over 15 Metres in South Limb

Latest Results Increase Total Mineralized Strike Length 8%

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 20, 2010) - Hana Mining Ltd., ("HMG" or the "Company") - (TSX VENTURE:HMG) (FRANKFURT:4LH) is pleased to announce completion of 23 new RC drill holes at its Ghanzi sediment-host copper-silver project in Botswana. Results on 8 of these holes are shown below. The 23 new holes extend total mineralization by 2000 metres along strike for two areas in the Banana Zone; the South Limb (section 60,000), and the Southwest Fold Closure ("SW Fold") (sections 30,000 to 45,000). See figure 1 for locations.

Highlights of recent drilling results:

  • Of these 23 new RC holes, 19 holes returned significant mineralization, increasing mineralized strike length in the Banana Zone by 2000 metres, to a total 22.4 km, now 44% (6,900 metres) greater than reflected in the current NI 43-101 resource estimate.

    • South Limb results (8 holes) extend mineralized strike by 1000 metres, to 3.4 km, and

    • SW Fold results (15 holes) extend mineralized strike by 1000 metres, to 3.0 km.

  • The latest South Limb results partially close out one of several strike length gaps that existed between previous drill results. The remainder of this particular gap of 1,300 metres will be addressed by 9 pending holes.

    • We plan to continue to close gaps along strike in this area, which comprises 15 km total length, and remains open to the north and south, as well as down-dip, and

    • Our current drill results location shows an increase in grade with depth, along with substantial thickness in mineralization.

  • We now have assay results on a total of 36 RC holes in the SW Fold, with 4 additional assays pending. These results, including the 15 most recent holes, show consistently lower grade mineralization than we have found in other areas in the Banana Zone. Summarizing grade results on our most recent 15 holes:

    • Four holes show a mineralized intercept of 4+ metres, at 0.75% Cu or better, and

    • Nine holes show a mineralized intercept of 4+ metres, at 0.5% Cu or better.

Based on the drill results we see in the SW Fold, we do not believe this area will generate resource tonnage at comparable grades to what we have achieved elsewhere in the Banana Zone.  Relatively thick mineralization, shallow dip, and thin overburden are attractive attributes to the findings here, but are not expected to overcome Cu grade issues at our current Cu cut-off assumptions.

  • The possibility of heap leach and solvent extraction techniques (SX-EW) exists here, based on the presence of malachite and chalcocite copper minerals, but requires more economic and metallurgy study than has been done to date, and

  • We now believe other areas of the Banana Zone are more prospective, and will refocus the drill rig working this area onto other targets, specifically in the 45,000 section moving north towards the South Flank.

The results of the eight new holes in the South Limb (section 60,000) are as follows:

  Area   From To Intercept Total      Silver
Hole & Grid Hole (metre    (metre Length Cu Grade      Grade
Number Reference Type depth) depth) (metres) (%)          (g/t)
HA-132-R South Limb Down Dip 125 140 15 1.21 16.8
  60,000 including 129 132 3 1.73 21.1
    including 136 140 4 1.68 23.7
HA-127-R South Limb Step-Out 85 96 11 1.04 12.4
  60,000 including 90 91 1 1.20 13.2
    including 94 96 2 2.68 36.5
HA-121-R South Limb Step-Out 137 146 9 1.00 11.8
  60,000 including 143 145 2 2.00 22.9
HA-109-R South Limb Step-Out 116 120 4 1.04 10.9
  60,000 including 116 117 1 1.22 7.6
    including 118 119 1 1.64 19.3
    and 121 124 3 1.05 10.3
    including 122 123 1 1.65 14.7
HA-111-R South Limb Down Dip 167 174 7 0.94 9.5
  60,000 including 167 171 4 0.97 10.6
    including 170 171 1 1.44 20.8
    including 172 174 2 1.19 10.3
    including 173 174 1 1.52 13.3
HA-114-R South Limb Down Dip 159 169 10 0.73 9.1
  60,000 including 165 169 4 1.20 15.3
HA-118-R South Limb Step-Out 119 128 9 0.76 8.4
  60,000 including 122 128 6 0.91 10.5
    including 126 128 2 1.04 11.9
HA-124-R South Limb Step-Out 140 153 13 0.46 5.0
  60,000 including 140 142 2 0.73 5.1
    including 145 152 7 0.53 6.2
    including 148 152 4 0.64 7.2

All intercepts reported are intersection length, estimated to represent >80% of true thickness.

To view Figure 1: Location of New Drill Hole Assays In Banana Zone, please visit the following link: http://media3.marketwire.com/docs/hmgfig1.pdf

To view Figure 2:  Drill Hole Locations, South Limb (section 60,000), please visit the following link: http://media3.marketwire.com/docs/hmgfig2.pdf

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

"I am pleased that we continue to meet the objectives of the drill program we initiated in August of this year; specifically, to confirm mineralization along strike in several new areas in the Banana Zone, in fill gaps between known mineralized areas, and ultimately give us an expanded drill hole inventory with which we plan to revise our NI 43-101 resource soon. These latest results build on previous findings, and continue to evidence continuity of copper/silver mineralization along the defined trend in the South Limb.

We have presented results on 27 RC holes in the South Limb since October, and intend to complete the remaining 1.6 km of open strike in this drill campaign that will allow us to demonstrate a continuous mineralized strike of 10.7 km between sections 55,000 and 65,000.

The results on our latest drilling in the SW Fold are generally consistent with earlier results, announced in November and December 2009, indicating this to be an area of lower grade mineralization. This area could have development significance for us, depending on whether we discover other concentrations of similar, leachable material at grades that would make an SX-EW facility attractive. However, the Banana Zone still contains extensive untested strike length, and we have determined our best course to be to focus elsewhere, and leave the SW Fold for future study, in the context of a larger, zone-wide heap leach economic study."

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. A 35-40 kilogram sample is collected from the cyclone discharge at 1 meter intervals. The sample is then split 75/25; 75% of the sample is archived and the other 25% provides material for analysis. All samples 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 2,200 sq. km., and contains sediment-hosted copper-silver deposits with a demonstrated cumulative mineralized strike length of 26.9 kilometres. This favourable geology extends over the entire strike length of 600 kilometres Hana Mining released results of it's first NI 43-101 resource estimate for the Ghanzi Project in June 2009, announcing an inferred resource of 2.0 billion lb of copper and 34.9 million oz of silver from 60.4 million tonnes. This resource estimate is based on a 0.75% Cu cutoff grade, and averages 1.51% Cu and 17.98 g/t Ag. The Banana Zone represents 40.7 million tonnes of this total resource (67%), has been the focus of the Company's drilling and development efforts for 2009, and will remain the primary focus for 2010.

The Banana Zone exhibits certain areas of high grade Cu and Ag mineralization, particularly in the New Discovery area and the fold nose at the northern end of the zone, which represent an opportunity to locate starter pits and mine initial tonnages at higher than average grades. These +2% Cu 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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