Mantra Mining Inc.

Mantra Mining Inc.

May 01, 2009 18:26 ET

Mantra Negotiates Agreement to Acquire Interest in Alaska Properties

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 1, 2009) - Mantra Mining Inc. (TSX VENTURE:MAN) ("Mantra" or the "Company") announces that it has entered into an agreement with Cougar Gold LLC ("Cougar"), a Delaware company having an office in Denver, Colorado, to acquire, directly or indirectly, Cougar's 55% interest in Golden Lynx LLC ("Golden Lynx"). Golden Lynx is currently the owner of 135 claims located in southwestern Alaska that comprise approximately 20,040 acres.

Golden Lynx Properties

The Golden Lynx properties consist of five claim blocks located in Alaska's Kuskokwim Mineral Belt, a major past producer of placer gold. The properties lie approximately 120 miles southwest of NovaGold Resources Inc. and Barrick Gold's giant Donlin Creek gold deposit (29.5 M oz) in the same geologic terrane. The following information respecting the properties has been provided to the Company by Cougar.

The Kisa claim block consists of 32 state mining claims (4,520 acres) covering an area underlain by an intrusive suite if rhyolitic to gabbroic dikes and sills intruding hornfelsed sedimentary rocks. Past work includes 945 meters of drilling in six holes which tested the Kisa breccia, a 300 meter by 500 m silica-carbonate-sulfide altered breccia body. All six drill holes encountered broad zones of altered breccia with gold mineralization. The best intersection, in hole K07-05, cut 115 meters averaging 0.7 g/t gold. The claim block also contains two other target areas which show alteration and mineralization in dike-sill complexes and focused on fault zones.

The Gold Lake claim block consists of 69 state mining claims covering approximately 9,720 acres and located 8 miles south of the Kisa Prospect. The claim group covers areas of hydrothermally altered and gold mineralized igneous dikes and sills similar to the Kisa showings. A soil anomaly over the area reaches over 1 km along strike, and overlaps part of a coincident magnetic and IP geophysical anomaly. Four drill holes totaling 984 meters tested a portion of the veined dike and sill complex and cut thick intervals of moderately to strongly altered and weakly gold mineralized sediments and intrusives. All the holes bottomed in hornfels indicating proximity to a larger intrusive body at depth.

Three other claim blocks over the Little Swift, Gold Creek, and Gossan Valley prospects, lie between 2 and 8 miles southwest of the Gold Lake claim, and contain 28 claims covering 4,480 acres. These prospects focus on iron-oxide stained zones along the contact between a quartz monzonite stock and adjacent hornfelsed sedimentary rocks which show geochemically anomalous concentrations of gold and associated trace elements.

Business terms

In order to maintain a 55% interest in Golden Lynx, Mantra must make capital contributions to Golden Lynx of US$321,000 by April 18, 2010 and a further US$1,500,000 by April 18, 2013, which amounts will be used to fund exploration expenditures on the properties owned by Golden Lynx. Mantra will have the right to acquire an additional 25% interest in Golden Lynx by making an additional capital contribution of US$2,500,000 by April 18, 2015.

The consideration payable by Mantra for the interest in Golden Lynx consists of 4,200,000 common shares at a deemed price of C$0.50 per share, representing approximately 8.4% of the currently issued and outstanding common shares of Mantra, which will be issued to Cougar on the closing of the acquisition.

The closing of the acquisition remains subject to a number of conditions, including regulatory and third party approvals and the raising of funds by private placement. There can be no assurance that the acquisition will be completed as proposed or at all.

Jerry Zieg, Vice President Exploration for Mantra, is a Qualified Person for the purposes of National Instrument 43-101 and has reviewed and approved the information of a scientific or technical nature contained in this news release.


Raj Chowdhry, President

Cautionary Notice: This release may contain forward-looking statements regarding the Company's business or financial condition, including the possible completion of transactions. Actual results could differ materially from those described in this news release as a result of factors, including, but not limited to the following: the timing of and ability to obtain regulatory and third party approvals, the timing of and ability to obtain required financing 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, unless required by applicable law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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