Mines Management Announces 1st Quarter Results

Business Wire,  May 27, 2008  

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SPOKANE, Wash. -- Mines Management, Inc. (AMEX:MGN) (TSX:MGT) ("the Company") is pleased to announce operational and financial results for the quarter ending March 31, 2008.

Advancing the Montanore Silver-Copper Project continues to be the Company's main focus. In addition to its planned advanced exploration and delineation drilling program, the Company is continuing its repermitting efforts with federal and state agencies and its optimization review of the Project.

Overview

In the first quarter of 2008, the Company:

* Received notice from Montana Department of Environmental Quality (DEQ) confirming that Hard Rock operating Permit 150, originally issued in 1993, was transferred to the Company with the acquisition of Noranda Mineral Corporation in 2006.

* Hired Mr. John Thompson, Vice President/General Manager for the Montanore Project, effective January 1, 2008.

* Selected Small Mine Development of Boise, Idaho (SMD) as contractor to manage activities related to rehabilitation and advancement of the Libby adit and drill station development.

* Maintained a strong cash and investment position with $28.7 million on hand at March 31, 2008.

The Company has initiated its planned two-year advanced exploration and delineation drilling program at the Montanore Project. During the first quarter of 2008, the Company continued to make preparations for the commencement of drifting and delineation drilling, including commissioning of the water treatment plant and preliminary work on the rehabilitation of the Libby adit. Full scale dewatering and rehabilitation are expected to begin upon completion of the environmental assessment covering the Company's proposed road use during the program by the U.S. Forest Service.

When dewatering and rehabilitation is complete, the Company plans to advance the adit approximately 3,000 feet toward the center of the deposit, then complete an additional 10,000 feet of development drifting to provide drill access to different portions of the deposit, construct drill stations, and complete diamond core drilling of approximately 50 holes totaling approximately 45,000 feet.

The objectives of the advanced exploration and delineation drilling program are to:

* Expand the known higher grade intercepts of the Montanore deposit;

* Develop additional information about the deposit;

* Further assess and define the mineralized zone; and

* Provide additional geotechnical, hydrological, and other data.

Results of the drilling program, if successful, are expected to provide data to support the completion of a bankable feasibility study.

The net cash expenditures for the quarter ending March 31, 2008 were $0.9 million for the purchase of equipment and commissioning of the water treatment plant and other site infrastructure and $2.5 million for operating activities. The Company believes that it has sufficient working capital for rehabilitation of the Libby adit and commencement of drifting and delineation drilling.

Advanced Exploration and Delineation Drilling Program

In the first quarter of 2008, the Montanore Project continued to make progress on several fronts. Construction work at the site included commissioning of the water treatment plant and construction of an outside storage facility. Minor modifications were made during the testing and initial start up of the water treatment plant, which included the addition of a pH control system and miscellaneous adjustments to various programmable control systems. Additional work on the water treatment system included the design of the underground sumps and the rehabilitation of approximately 100 ft. of adit immediately beyond the steel sets. A contract for the design and engineering study of a nitrate removal system to be added to the water treatment plant was awarded in the first quarter.

Additional work directly related to the rehabilitation included an initial ground control and support evaluation of the existing ground conditions by an outside ground support consultant. A request for quotation was prepared and sent out to several mining contractors for the rehabilitation work. Bids were received back and evaluated with an award in March 2008 for the work to Small Mine Development of Boise, Idaho. Work was also initiated on the layout and design of the delineation drilling program.

The commissioning and start-up of the Sandvik roof bolting machine and the Getman scaler have been completed with both machines functioning satisfactorily. Equipment received during the first quarter included an underground lube/service truck and a scissor lift platform truck.

Permitting and Environmental

In the first quarter of 2008, the Company continued to work with the federal and state agencies reviewing the preliminary draft environmental impact statement (PDEIS). Included in this review is the development of monitoring plans and mitigation for the Project to address potential impact on surface and ground water, grizzly bear, bull trout, and other natural resources. Management expects that a draft EIS will be issued to the public for comment this summer.