MDN Inc.
TSX : MDN

MDN Inc.

November 07, 2007 13:45 ET

MDN Provides Corporate Development Update

MONTREAL, QUEBEC--(Marketwire - Nov. 7, 2007) - MDN INC. ("MDN") (TSX:MDN) is pleased to announce an update of its corporate developments activities, mainly about the mining operations in Tanzania and in Quebec.

Highlights - Tulawaka Gold Mine:

- Gold production at Tulawaka amounts to 41,817 oz. for the third quarter 2007 and 124,367 ounces since January 1st, 2007, at an average cash cost of $273/oz;

- Mine's management currently estimates that gold production at Tulawaka during 2007 will amount to approximately 185,000 oz. at an average cash cost between $260-270/oz.;

- At an average selling price around $700/oz. for the year 2007, Tulawaka should generate a total revenue of approximately US$130M;

- For a second consecutive quarter, the Tulawaka Gold Mine distributed US$15M to the joint-venture participants MDN (30%) and Pange Goldfields (70%). MDN's share of these distributions (US$4.5M) has been entirely applied to the reduction of its debt, which includes gold price royalties, interest and capital;

- Following the dividends distribution, the Tulawaka Gold Mine had a cash balance of US$17.3M to support current operations;

- As at September 30, 2007, the long term debt (non-recourse loan relating to the Tulawaka Gold Mine) amounted to $9,583,758 compared with $18,870,040 as at December 31, 2006. Management currently estimates that based on the gold price which is over US$800, the long term debt should be paid in full by mid 2008;

- Tulawaka underground development work's progress at an intensive pace and the production should start in the beginning of 2008, in order to feed the mill in alternation with the gold coming from the open pit. Having the objective of increasing Tulawaka Gold Mine lifetime, an in-depth exploration program is about to begin. As for the exploration efforts on the surface, the principal targets are the T7, the North-West and West Zones.

The excellent performance and the financial support of the Tulawaka Gold Mine provide a key financial benefit to MDN's strategic development plan, which can be implemented much more aggressively: "We have $14.8M in cash and we expect to receive up to $40M coming from the warrants exercise within the next 15 months. In addition to these cash flow projections, we should receive from the Tulawaka Gold Mine an amount of over US$20M, based on an annualized dividend when our long term debt will be entirely reimbursed by the end of the second quarter of 2008", stated Paul-A. Girard, President and CEO of MDN.

These financial forecasts allow MDN's management to accelerate the growth plan, both in exploration works and acquisitions activities: "We have signed confidentiality agreements with several mining companies which allow us to evaluate certain important mining assets, adds Mr. Girard, and we aim to conclude at least an agreement, if not several during the upcoming months".

Highlights - Exploration in Tanzania:

- MDN's primary gold targets around Tulawaka, namely Isambara and Viyonza, are currently the subject of intensive exploration works for a total investment of US$4M in 2007, of which US$2M will be spend during the fourth quarter;

- MDN's geologist team is pleased and remains confident based on the recent exploration results on Isambara and the obvious similarities with the gold deposits of the batholite of Bourlamaque located in the mining camp of Val d'Or (Abitibi) and in particular with the Ferderber gold deposit (Belmoral Gold Mine) which production grade was 6,46 gold g/t;

- Isambara's gold target consists of ground anomaly of 5 km by 2 km in which we can observed an alternation of high grade gold lenses that can go up to 45.58 g/t gold over 4m and zones with low grade having between 1 to 3 g/t gold in shear zones characterized by multiple quartz injections, strong alterations and two generations of sulphides dominated by pyrite;

- The third phase of drilling on Isambara is currently ongoing and aims to recognize the untested zones of the anomaly, in addition of establishing with precision geological controls of the richest and the most consistent sectors;

- The drilling results on Viyonza are being analysed and should be published over the next two or three weeks. As an high grade gold deposit, Viyonza's drilling results conducted in 2006 indicated 35,9 g/t gold over 2m, 17,1 g/t gold over 3m, 7,3 g/t gold on 9m and 13,2 gold g/t over 2m;

- The initial drilling program on Viyonza has been recently increased from 3,300 meters to 5,700 meters.

MDN's strategy is to emphasize on one or more gold deposits in order to maximize its investment in the Tulawaka Gold Mine by taking advantage of its control position on the prospecting licences around the Tulawaka region. To date, this strategy shows positive results.

MDN is manly focussing on the economic value of a project. Therefore, the main objective is not to identify a gold deposit with high grades such as Tulawaka, but a gold deposit economically viable which could be a low grade deposit as it is the case for the Geita Gold Mine located not far from Tulawaka and whose average content is of 3.2 g/t gold whereas combined tonnage (reserves and resources) is 221.5 M tonnes or 23.1 M ounces of gold.

Tanzania's gold production currently occupies the third rank in Africa. Therefore, MDN intends to pursue its strategy of acquisition in Tanzania, without geographical limitation although the sector of Tulawaka is still a primary focus.

Highlights - Exploration in Quebec

- Beginning of drilling works of on the DesMeloizes property, sector of Normetal. MDN has the option to acquire 50% interest from SOQUEM;

- Consolidation of the joint venture between MDN and SOQUEM through a single agreement gathering all the joint venture properties: Clairy, Le Tac, Lesperance, Lac Shortt and DesMeloizes (under option);

- Launch in 2008 of a re-evaluation programme to update MDN's mining assets in Quebec.

The DesMeloizes property is located at less than 2 km of the old Normetal mine (Xstrata). Its geological environment is favourable to the presence of volcanogenic massive sulphides (VMS) poly-metallic deposits. The mineralised horizon of the old Normetal mine is well identified on a distance of at least 5 km inside DesMeloizes.

All samples were analyzed by fire assay at the SGS laboratories in Tanzania, certified under international standards. A rigorous program of analytical grade verification implemented by MDN included 12% control samples.

Quebec's technical information was approved by Yvon Trudeau, engineer and Assistant Manager of SOQUEM INC. who acted as a qualified person in accordance with NI 43-101. Technical information presented in this press release was reviewed and approved by geologist Dominique Fournier, Ph.D., who acted as a qualified person in accordance with NI 43-101.

MDN Inc. is a mining exploration company with its head office in Montreal, Quebec (Canada). Its main exploration activities are carried out in Quebec and Tanzania.

SOQUEM is a subsidiary company of SGF Mineral Inc., itself subsidiary of la Societe generale de financement du Quebec ("SGF").

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