Hana Mining Ltd.

Hana Mining Ltd.

February 21, 2012 07:00 ET

Hana Mining Ltd.: Infill Drilling at the Northeast Fold Confirms New Geological Interpretation of Ghanzi Mineralization, More Spectacular Copper-Silver Grades at the Banana Zone

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 21, 2012) - Hana Mining Ltd. ("Hana" or the "Company") (TSX VENTURE:HMG)(FRANKFURT:4LH) is pleased to announce its most recent drilling results from the completion of 12 infill diamond drill holes in the Banana Zone at its Ghanzi sediment hosted Copper-Silver Project in Botswana.

Infill drilling was carried out on the Northeast Fold area (between sections 70125 to 70725 at the Northeast Fold; Figures 1 and 2) to convert a substantial amount of the NI 43-101 compliant resources within this area into the Indicated category from the Inferred category.

These results are from new holes and are in addition to those used in the most recent NI 43-101 compliant Indicated and Inferred mineral resource calculation (see Table 1 at the end of this press release for the results from all 12 drill holes). The mineralization remains open at depth.

Highlights of recent drilling results:

  • The latest results demonstrate that Banana Zone contains areas which host high-grade copper-silver mineralization.
  • Core lengths intercepts of
    • 14.23% CuEq(1) (11.22% Cu and 206.0 g/t Ag) over 2.9 metres within a wider mineralized interval of 1.07% CuEq(1) (0.85% Cu and 15.0 g/t Ag) over 47.2 metres in hole HA-482-D,
    • 6.62 CuEq(1) (5.45% Cu and 80.0 g/t Ag) over 3.2 metres within a wider mineralized interval of 1.11% CuEq(1) (0.95% Cu and 11.0 g/t Ag) over 55.9 metres in hole HA-443-D,
    • 4.02% CuEq(1) (3.32% Cu and 48.0 g/t Ag) over 7.2 metres within a wider mineralized interval of 1.46% CuEq(1) (1.21% Cu and 17.0 g/t Ag) over 24.2 metres in hole HA-487-D
    • 3.01% CuEq(1) (2.46% Cu and 38.0 g/t Ag) over 2.9 metres within a wider mineralized interval of 1.15% CuEq(1) (1.03% Cu and 8.0 g/t Ag) over 33.0 metres in hole HA-478c-D.

(1) Copper equivalent calculated using US$3.00/lb Cu, US$30/oz Ag and is not adjusted for metallurgical recoveries. The formula used is as follows: CuEq = Cu% + (Ag g/t x 0.01458).

Discussion of Results:

These are the second set of results from the 2011 infill drilling program for the Northeast Fold area which is located at the most northeast part of the Banana Zone. This area consists of a plunging anticline where up to four intervals of high-grade copper mineralization within a broader low grade mineralized envelope were encountered within the hanging siltstones and mudstones and footwall sandstones. These high-grade veins of mineralization represent new exploration targets. Exploration drilling will continue at the Northeast Fold to identify and expand these high-grade mineralized zones. High-grade mineralization at the Northeast Fold remains open along plunge and along dip of this anticlinal structure. Further infill drilling results from the Northeast Fold are expected soon.

To view "Figure 1: Location of Most Recent Drilling Results at the Banana Zone" please visit the following link: http://media3.marketwire.com/docs/HanaFig1.pdf

To view "Figure 2: Drill Hole Location of Northeast Fold, Sections 70125-70725" please visit the following link: http://media3.marketwire.com/docs/HanaFig2.pdf

To view "Figure 3: Cross-section through section 70525 (Northeast Fold)" please visit the following link: http://media3.marketwire.com/docs/HanaFig3.pdf

Development Update

The following engineering and consultation activities are ongoing:

  • Work on the revised resource estimate for the Banana Zone is continuing as expected and the Company expects to release the results of this resource estimate in the second quarter of 2012.
  • Work continues on the Preliminary Economic Assessment ("PEA") which is also expected to be completed in the second quarter of 2012.

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

"Several months ago our geologists were tasked to formulate a new geological model which would allow us to identify areas within the Banana Zone, and other parts of the Ghanzi Project, that may host high-grade copper-silver mineralization. After a concerted core re-logging campaign, involving over 300 drill holes, and interpretation, our geological team was able to identify additional stratigraphic and structural parameters which may contribute to the deposition of high-grade copper-silver mineralization. This hypothesis is currently being currently tested, with tremendous success, in the Northeast Fold area. Later, we will test this geological model elsewhere at the Banana Zone and other areas of the Ghanzi Project. Unfortunately, because of time constraints, not all of these drill holes will be included in the upcoming Preliminary Economic Assessment but will be included in the forthcoming Feasibility Study."

"If our hypothesis proves to be successful elsewhere at the Banana Zone it will have a tremendous impact on Ghanzi Project and the rest of the Kalahari Copper Belt."

Qualified Person and Quality Assurance/Quality Control

The drilling program and results are reviewed and approved by Marek Kreczmer, Chief Executive Officer for Hana. He is the qualified person as defined in NI 43-101 and has reviewed the technical information in this press release.

Drill core is logged and photographed. Mineralized intervals are split in half by sawing and sampled at site. The remainder of the core is kept as a permanent record. Samples are placed into labelled bags, closed and packed into sealed bags that are shipped to ALS Chemex Laboratory in Johannesburg, South Africa or Scientific Services Laboratories in Cape Town, South Africa. Hana has implemented an industry-standard QA/QC program that includes the blind insertion of certified standards, duplicates and blanks into the sample stream.

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 2,149 square kilometres, and contains sediment-hosted copper-silver deposits with a demonstrated cumulative tested strike length of 70 kilometres. This favorable geology extends over an estimated strike length of 600 kilometres. Hana Mining released results of its most recent NI 43-101 compliant resource estimate for the Ghanzi Project on December 20, 2010, announcing an Indicated mineral resource of 585 million pounds of copper and 12 million ounces of silver from 19.7 million tonnes at a grade of 1.35% copper and 19.7 g/t silver. All of the Indicated resources are from the Banana Zone. There are also Inferred resources of 2.4 billion pounds of copper and 40.6 million ounces of silver from 91.2 million tonnes. This Inferred mineral resource estimate consists of 69.9 million tonnes grading 1.10% Cu and 14.98 g/t Ag in the Banana Zone, 13.4 million tonnes grading 1.66% Cu and 12.11 g/t Ag in Zone 5, 6.3 million tonnes grading 1.5% Cu and 6.7 g/t Ag in Zone 6, and 1.6 million tonnes grading 0.85% Cu and 6.4 g/t Ag in the Chalcocite Zone; all at a cut-off grade of 0.75% Cu.

The Banana Zone exhibits certain areas of higher grade Cu and Ag mineralization, particularly between sections 49700 to 52000 on the North limb and sections 63000 to 71000 on both the North and South limbs, 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 proposed rail and 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. Construction has begun on the 600MW expansion of the government-owned Moropule Power Plant, having secured US$825 million project funding in May 2009. The Ghanzi Copper- Silver Project is currently accessed by the paved Trans-Kalahari highway, which passes within 15 km of the property.

The Ghanzi property is one of Africa's premier future copper-silver resources.

To view "Table 1: Drill Results from Northeast Fold, Banana Zone, Sections 70125-70725 Interval indicates down hole interval" please visit the following link: http://media3.marketwire.com/docs/HanaTable1.pdf

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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