Mandalay Resources Corporation Announces Further High-Grade Intercepts at Youle (Costerfield) and the Discovery of the Aurora Zone at Björkdal

TORONTO, Nov. 14, 2018 - Mandalay Resources Corp. ("Mandalay" or the "Company") (TSX: MND, OTCQB: MNDJF) is pleased to provide an exploration update from recent diamond drilling on the emerging Youle deposit at its Costerfield operation in Victoria, Australia, as well as initial diamond drilling on the newly discovered Aurora deposit at its Björkdal operation in Sweden.

Since the Company’s last exploration press release on June 27, 2018, the Company has drilled 24 holes at the Costerfield Youle Vein (see Table 3). The Company has also drilled 54 holes at the Björkdal Aurora Zone (see Table 4). Highlights from the recent Youle (Costerfield) and Aurora (Björkdal) drilling include the following intercepts:

Table 1: Youle (Costerfield) Drilling Highlights

Table 2: Aurora Zone (Björkdal) Drilling Highlights

Dominic Duffy, President and CEO of Mandalay, commented, “Infill drilling at Youle continues to intercept significant gold and antimony grades, along with unbroken structural continuity over a 600 metre strike length. Three new intercepts have returned considerably higher grades than previously reported for Youle (see Mandalay press releases dated April 3 and June 27, 2018). Elevated understanding from infill drilling has revealed the potential for high-grade extension to the north and south, and at depth. This discovery gives the Company increased confidence about how this deposit can grow, and further potential for what has been, to date, the highest-grade deposit Mandalay has found. At a district level, the Youle discovery has accelerated our understanding of the geology and further potential of Costerfield and has unlocked new exploration targets, both adjacent to known mineralization, and throughout the property.”

Mr. Duffy continued, “We are also very pleased about an exciting discovery at Björkdal, known as the Aurora Zone. This exploration success is in keeping with the Company’s new focus at Björkdal to mine wider and higher-grade areas for increased profitability. The Aurora Zone is significantly wider than any other mining area at Björkdal, which is expected to allow for more efficient production. Exploration drilling and two levels of development initiated in the third quarter of 2018 have shown higher average grades than those historically mined from underground. Geologically, the Aurora Zone is noteworthy because it is the first area in the Björkdal underground where we have encountered mineralization above the marble contact. Historically this contact has limited the upper extensions of mineralization, meaning that the Aurora Zone has the potential for significant vertical extension. Currently, Aurora is open to extension in all directions.”

Youle Drilling Update

Charts accompanying this announcement are available at
http://www.globenewswire.com/NewsRoom/AttachmentNg/fd76678c-365b-4702-b17b-84d81ad6b8b3

http://www.globenewswire.com/NewsRoom/AttachmentNg/b4e793f5-c2f9-4579-a6ef-93068d93b03c

Drilling details for Youle are found in the table below:

Table 3: Youle Drilling Results (June 2018 – October 2018)

At present, Youle is still open in all directions. Current drilling efforts are focused on exploring the southern extension of mineralization with the objective of encountering the high-grades of Youle potentially closer to the Company’s current mining focus (the Brunswick deposit). Reducing the distance between Youle and Brunswick is expected to reduce the time required to begin producing from Youle. The Company anticipates that Youle will be added to the Company’s 2018 Mineral Reserves and Resources update which it plans to release in early January 2019.

Aurora Drilling Update

At Björkdal, underground extension diamond drilling northwards past the Lake Zone (Figure 3) has resulted in the discovery of a broad mineralized zone (the Aurora Zone) with assay results that are consistently higher-grade than current mill feed. Drilling to date in the zone suggests that it is large in size and of consistent grade. It currently extends approximately 250 metres horizontally in an east-west direction and 150 metres vertically, and is outlined by approximately 50 diamond exploration and development optimization drill holes to date (Figure 4 and Table 4). Two underground development drives were also initiated during the third quarter, 2018.

Charts accompanying this announcement are available at

http://www.globenewswire.com/NewsRoom/AttachmentNg/0dc388a6-ed14-49fa-9eca-46abe10fb81c

http://www.globenewswire.com/NewsRoom/AttachmentNg/0539a0fc-e752-4edb-911c-4f61b48193ea

Drilling details for Aurora are found in Table 4 below:

Table 4: Aurora Drilling Results

The discovery of gold mineralization at Aurora provides the potential to mine high-tonnage/higher-grade ore more cost effectively. Aurora is readily accessible from current underground developments, with two levels already having been initiated.

Based on the Company’s current drilling data, Aurora appears to be open in all directions. Extensional drilling during the remainder of 2018 and into 2019 is expected to focus on larger step-outs above and below the known mineralization to obtain a framework overview by bounding the Aurora mineralized zone.

Drilling and Assaying

At Youle, diamond drill core was logged and sampled by Costerfield geologists. All samples were sent to Onsite Laboratory in Bendigo, Victoria, Australia, for sample preparation and assay. Site geological and metallurgical personnel have implemented a QA/QC process that includes the regular submission of standard reference materials and blanks with drill and face samples submitted for assay. Standard reference materials have been certified by Geostats Pty Ltd. (see March 29, 2018, Technical Report entitled “Costerfield Operation, Victoria, Australia NI 43-101 Report”, available on SEDAR (www.sedar.com), which contains a complete description of drilling, sampling, and assaying procedures).

At Björkdal, all diamond drill core was logged and sampled by Björkdal geologists. Exploration drill hole samples (prefix MU) were sent to CRS Minlab Oy (CRS) in Kempele, Finland for sample preparation and assaying. Development Optimization drill hole samples (prefix DOD) were at the onsite lab ran by ALS for sample preparation and assaying (see March 29, 2018, Technical Report entitled “Technical Report on the Björkdal Gold Mine, Sweden”, available on SEDAR (www.sedar.com), which contains a complete description of drilling, sampling, and assaying procedures).

Assaying in both the CRS and ALS laboratories was conducted utilizing the Pal1000 (CRS) cyanide leaching processes. Mandalay’s rigorous QA/QC program included the use of standard reference samples, blanks, duplicates, repeats, and internal laboratory quality assurance procedures.

Qualified Person:

Chris Gregory, Vice President of Operational Geology and Exploration at Mandalay Resources, is a Member of the Australian Institute of Geoscientists (AIG), and a Qualified Person as defined by NI 43-101. He has reviewed and approved the technical and scientific information provided in this release.

For Further Information

Dominic Duffy
President and Chief Executive Officer

Greg DiTomaso
Director of Investor Relations

Contact:
647.260.1566

About Mandalay Resources Corporation

Mandalay Resources is a Canadian-based natural resource company with producing assets in Australia and Sweden, and care and maintenance and development 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, the Americas, and Europe to generate near-term cash flow and shareholder value.

Forward-Looking Statements:

This news release contains "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the exploration and development potential of the Youle deposit (Costerfield) and the Aurora Zone (Björkdal). Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading “Risk Factors” in Mandalay’s annual information form dated March 29, 2018, a copy of which is available under Mandalay’s profile at www.sedar.com. In addition, there can be no assurance that any inferred resources that are discovered as a result of additional drilling will ever be upgraded to proven or probable reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.