Mandalay Resources Corporation is pleased to announce that it has signed a 12 month extension to its concentrate off-take agreement with Zhongnan Antimony and Tungsten Trading Company for all antimony-gold concentrate produced at its recently acquired (see news release dated December 1, 2009) Costerfield mine in Australia. The extended contract improves the percentage of antimony paid to an average of 60% from 55% and improves the pricing for gold contained in antimony concentrate at gold prices over US$1000/ounce.

Brad Mills, Chief Executive Officer of Mandalay said, "We are very pleased to extend our off-take agreement with Zhongnan Antimony and Tungsten Trading Company. As well as ensuring a valued customer for our concentrate, the extension improves on the terms under which Mandalay will receive payment for our concentrate."

The Company is also pleased to provide a production update on its newly acquired Costerfield gold mine in Australia. For the month of December, the mine, which is currently in ramp up mode, produced 1599 tonnes of ore versus a plan of 2095 tonnes. The concentrator processed 1833 tonnes of ore producing 41.1 tonnes of antimony and 172 ounces of gold contained in 74.8 tonnes of antimony concentrate and 30 ounces of gold in gravity concentrate. An additional 61 ounces of gold were produced from the tailings reprocessing plant versus a plan of 270 ounces. Both the underground mining operations and tailings operations are expected to reach full design (average 5000 tonnes per month ore from the mine and 250 ounces per month from the tailings) toward the end of the second quarter.

Brad Mills further commented "December production at Costerfield is significant because it marks the maiden production in Mandalay's evolution from an exploration company to a mid-tier producer. We are looking forward to the continued ramp up of both the underground mine and tailings operation and their achievement of operational design in the coming months."

Mandalay Resources is a Canadian-based natural resource company with producing assets in Australia and exploration projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas.