Mantra Mining Inc.
TSX VENTURE : MAN

Mantra Mining Inc.

February 26, 2008 14:38 ET

Mantra Mining Inc. Acquires Option on Elkhorn Potash Project in Manitoba, Canada

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 26, 2008) - Mantra Mining Inc. (the "Company") (TSX VENTURE:MAN). The Company is pleased to announce that it has entered into an option agreement (the "Option Agreement") pursuant to which the Company has been granted the option (the "Elkhorn Potash Option") to earn up to a 100% interest in an exploration permit application for the Elkhorn Potash Project, located within southwest Manitoba. The application encompasses 12 townships, along the Manitoba-Saskatchewan border covering approximately 110,592 hectares (approximately 276,480 acres).

Mantra CEO, Raj Chowdhry, comments, "We are very pleased to announce the acquisition of the Elkhorn Potash Project. The existing infrastructure in the Elkhorn Project area, together with the close proximity to major producers, such as Potash Corp.'s Rocanville Mine, will allow Mantra the opportunity to create shareholder value. This significant land package, located in a premier Potash mining district, with significant corporations such as Agrium Inc. and BHP Billiton as neighbours, affords Mantra shareholders a project with large blue sky potential while demand for Potash increases significantly worldwide."

The Permit Area

The Elkhorn Potash Permit is enclosed both to the north and south by land/permits held by Western Potash Corporation. Additional land/permit holders within a short distance to the north of Elkhorn Potash Project include: Agrium Inc. (TSX and NYSE: AGU), and Manitoba Potash Corp., which is held 51% by BHP Billiton and 49% by the government of Manitoba. BHP has previously announced $15 million exploration program for the Russell-Binscarth deposit held by Manitoba Potash Corp. Further, immediately west of the border in Saskatchewan, Potash Corp. of Saskatchewan recently announced a $1.8 billion expansion at the Rocanville Mine, increasing the capacity to about 5 million tonnes annually, to meet the growing world demand for potash.

The Elkhorn Potash Project was acquired to cover potential extensions of the potash-rich members of the Prairie Evaporite, which has been mined, according to Davies et al (1962 p. 178), for over 50 years in Saskatchewan.

According to Davies et al (Bannatyne, Barry and McCabe -1962), "Beds rich in potash salts occur in the upper part of the Devonian Prairie Evaporite in a narrow area along the west edge of the province from township 4 through to township 21. The potash occurs at depths ranging from 2,560 feet (780 m) in the north to 4,400 feet (1,241 m) in the south. S.A.M. Explorations Ltd. drilled the northern part of the area from 1956 to 1958, and their 3 wells indicated a potash bed 6 to 8 feet thick, grading 25% K2O or better..."

Terms of the Option Agreement with the arm's length Optionors

The Elkhorn Potash Option entitles the Company to earn the sole and exclusive right and option to acquire up to an undivided 100% right, title and interest in and to the Permits in accordance with the terms of the Option Agreement as follows:

1) Make cash payments of $500,000 to the Optionors as follows:

(a) $25,000 on the date of signing of the Option Agreement (the "Effective Date) - Paid;

(b) $100,000 within 5 business days from the Effective Date; and

(c) $125,000 within 30 business days of the acceptance of the Option Agreement by the TSX Venture Exchange (the "Approval Date").

A total of $225,000 of the aforementioned payments are refundable in certain circumstances, such as if the Permits are not granted within a fixed period of time.

Further, subject to the Optionors receiving valid Permits from the Manitoba Permit Authority and the Optionee receiving acceptance of the Option Agreement from the Exchange make the following cash payments.

(d) $100,000 on or before 6 months after the Approval Date; and

(e) $150,000 on or before 14 months after the Approval Date.

2) Issue 6,000,000 Shares (the "Total Shares") to the Optionors subject to the Optionors receiving Permits from the Manitoba Permit Authority on at least 120,000 acres (Total Shares to be pro-rated down based on 120,000 acres in the event the Permits cover less than 120,000 acres) and the Optionee receiving acceptance of this Agreement from the Exchange:

(a) 1,200,000 Shares within 12 months of the Approval Date;

(b) 1,800,000 Shares within 24 months after the Approval Date; and

(c) 3,000,000 Shares on or before 36 months after the Approval Date.

In addition, in the event certain resource, drilling, market capitalization and financing milestones are met by the Company, then 50% of all unissued Shares making the Total Shares will be issued immediately to the Optionors, subject only to the Exchange Approval.

3) Incur the following aggregate cumulative Expenditures of not less than $3,000,000 on the Permits as follows:

(a) $500,000 within 14 months of the later of the date the Optionors receive valid Permits from the Manitoba Permit Authority and the Approval Date;

(b) $1,500,000 within 24 months of the later of the date the Optionors receive valid Permits from the Manitoba Permit Authority and the Approval Date; and

(c) $3,000,000 within 36 months of the later of the date the Optionors receive valid Permits from the Manitoba Permit Authority and the Approval Date.

Finder's Fee

The Company, subject to TSX Approval and various other conditions, has agreed to pay a finder's fee (the "Finder's Fee") of 240,000 shares.

Potash Outlook

RBC Capital analyst Fai Lee in the Financial Post article dated Jan 22, 2008, although focused on Potash Corp., points out the strong demand for Potash from Southeast Asia as a major catalyst in the continuing surge in prices paid for Potash. The article also references historic lows in both customer and distributor warehouse inventories.

Involvement in Potash, the major component in the fertilizer arena, at a time when the world's growing population's need for food is subject to continued growth, especially in China, India and rest of Asia provides Mantra a unique and highly promising position to create shareholder value.

ON BEHALF OF THE BOARD OF DIRECTORS

Raj I. Chowdhry, C.A., President & CEO

Cautionary Notice: This release may contain forward-looking statements regarding the Company's business or financial condition. Actual results could differ materially from those described in this news release as a result of factors, including, but not limited to the following: additional drilling, sampling and resource valuations, engineering and construction timetables, financial arrangements, developments in world resource markets, political developments in Canada, the timing of regulatory and environmental approval and other factors. With respect to additional exploration, actual events may differ from current expectations of the Company or its joint-venture partners and other factors. The Company cautions that these and similar statements involve risk and uncertainties and are qualified by important factors, including competitive pressures, unfavorable changes in regulatory structures, and general risks associated with business, which could cause actual results to differ materially from those in the forward looking statement. Forward-looking statements are made in the context of information available as of the date stated. The Company undertakes no obligations to update or revise such statements to reflect new circumstances or unanticipated events as they occur.

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

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