Moly Mines Limited Update: Iron Ore Project Execution on Track for First Ore Shipment in December 2010 Extension to deadline for molybdenum project finance facility to 31 January 2011

TORONTO, ONTARIO -- (Marketwire) -- 09/22/10 -- Moly Mines Limited (TSX: MOL)(ASX: MOL) provides the following update on development activities at the Spinifex Ridge Iron Ore Project and the status of the US$500 million project financing for the Spinifex Ridge Molybdenum Project.

SPINIFEX RIDGE IRON ORE PROJECT - ON TRACK FOR FIRST SHIPMENT DECEMBER 2010

The major milestone of the successful wet commissioning of the new Utah Point shiploader and berth at Port Hedland over this last weekend gives the Company confidence that it is on track to meet its target of first shipment of iron ore in early December. Approximately 70,000 tonnes of Atlas Iron's ore was shipped on the bulk panamax vessel, the Bergen Max.

Dr Derek Fisher CEO of Moly Mines commented; 'This is a significant event for the new iron ore miners of the Pilbara and for Western Australia. The Port Hedland Port Authority, Atlas Iron, and POAGS Bulk Logistics are to be congratulated on this important achievement'.

Moly Mines is also pleased to announce that it has awarded the final significant operations contract for the 1 million tonne per annum Spinifex Ridge Iron Ore Project. The ore haulage contract has been awarded to local Pilbara operator Bullbuck Pty Ltd ('Bullbuck') for the transport of the iron ore product from the mine site to the Utah Point port facilities at Port Hedland.

Bullbuck has been operating in the Port Hedland region for more than 13 years providing road haulage services to remote mining locations in the wider Pilbara region. They currently provide haulage services to Consolidated Minerals and Aditya Birla Minerals.

In recent weeks, Moly Mines has announced the award of the mining contract to BGC Contracting Pty Ltd, crushing services to Rapid Crushing Pty Ltd, camp facilities management to the Compass Group / Pantarlangu JV and now the ore haulage agreement. This completes the major contract awards for the operation of the Spinifex Ridge Iron Ore mine.

The primary crusher has been delivered to site while the secondary crushers, screens and slewing stockpile conveyor will be completed by the second week in October for commissioning and production by the end of October.

Mining equipment began arriving on site early in September and mining operations will commence by the end of this month.

Ore haulage to Moly Mines' stockpile area at the Utah Point facility will commence on or around 6 November 2010. The stockpile will be built up over the course of November for first shipment of Spinifex Ridge ore in early December. Sales contracts will be concluded in the near term.

SPINIFEX RIDGE MOLYBDENUM PROJECT - US$500 MILLION PROJECT FINANCING FACILITY

The Subscription Agreement dated 19 October 2009 between Moly Mines and Hanlong Mining Investment Pty Ltd ('Hanlong') requires Hanlong to use best endeavours to procure a US$500 million Project Finance Facility ('Project Finance Facility') for the Spinifex Ridge Molybdenum Project ('Molybdenum Project') on or before 30 September 2010 ('Cut-off date'). Hanlong's parent entity Sichuan Hanlong (Group) Co Ltd agreed to provide, from itself or a related body corporate, a guarantee in favour of the proposed financiers.

Financing Status

Strong progress has been made toward completing the Project Finance Facility. Hanlong are actively engaged with the proposed financiers and regulatory authorities both at the Sichuan provincial and at the state level in Beijing. They have strong finance teams dedicated to the process in their Sydney, Chengdu and Beijing offices.

China Development Bank and China Exim Bank have participated in Perth office and Spinifex Ridge site due diligence over the last 8 weeks. In July, a comprehensive engineering study was completed by a major Chinese engineering group as part of the banking process for the 10 million tonne per annum Molybdenum Project.

In August the Sichuan branch of the National Development Reform Commission ('NDRC') concluded that the Molybdenum Project complied with overseas investment policies and the project has now been submitted to the Beijing office of the NDRC.

The proposed financiers have requested the completion of an Engineering Procurement and Construction ('EPC') contract that describes the scope, cost and schedule for construction of the Molybdenum Project as a core condition precedent to the financing. Moly Mines is currently preparing these arrangements with suitable contractors.

In addition, the proposed financiers have asked Hanlong and its related companies to provide additional asset security for the Molybdenum Project.

Hanlong has advised the Company that they anticipate finalizing term sheets for the Project Finance Facility in mid October 2010 with full loan documents expected to be executed during the period December 2010 to January 2011, subject to the completion of the EPC arrangements and iron ore and molybdenum marketing agreements with Hanlong that will be put to minority Moly Mines shareholders for approval before the end of 2010.

Although significant progress on the Project Finance Facility has been made, terms and conditions for the Project Finance Facility are still being negotiated with the proposed Chinese financers and the level of interest and feedback gives Moly Mines confidence that the funding will be forthcoming. Moly Mines acknowledges the continuing high level of support and commitment of Hanlong to complete this process in the shortest possible timeframe.

New Agreements

In consideration for the additional security, beyond the parent company guarantees, being offered by Hanlong that will strengthen the terms of the Project Finance Facility, Moly Mines has agreed to grant Hanlong additional time to procure the Project Finance Facility by amending the cut-off date in relation to the Financial Penalty to 31 January 2011. The Financial Penalty described in the Subscription Agreement will now apply on this new date. That is, if the Project Financing Facility is not available in accordance with the Subscription Agreement by 31 January 2011 approximately US$45 million of the Shareholder Loan will be forgiven and US$15 million will become immediately repayable.

Further Moly Mines will, subject to shareholder approval being received at the November 2010 Annual General Meeting, issue Hanlong 35.5 million Project Finance Options ('New Options') to replace the options issued under the Subscription Agreement which will lapse on 30 September 2010. The New Options will have the following terms and conditions:

--  The New Options will be exercisable at C$1.00 per share.

--  The New Options will only vest if full binding documents for the Project
    Finance Facility are executed by 31 January 2011. If full binding
    documents for the Project Finance Facility are not executed by 31
    January 2011, the New Options will be cancelled.

--  If the New Options vest by 31 January 2011, but conditions precedent to
    the initial drawdown of the Project Finance Facility are not met or
    waived and initial drawdown is not achieved by 31 December 2011, the New
    Options will be cancelled.

This news release includes 'forward-looking statements' as that term within the meaning of securities laws of applicable jurisdictions. Forward-looking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond Moly Mines' control. These forward- looking statements include, but are not limited to, all statements other than statements of historical facts contained in this news release, including, without limitation, those regarding Moly Mines' future expectations. Readers can identify forward-looking statements by terminology such as 'aim,' 'anticipate,' 'assume,' 'believe,' 'continue,' 'could,' 'estimate,' 'expect,' 'forecast,' 'intend,' 'may,' 'plan,' 'potential,' 'predict,' 'project,' 'risk,' 'should,' 'will' or 'would' and other similar expressions. Risks, uncertainties and other factors may cause Moly Mines' actual results, performance, production or achievements to differ materially from those expressed or implied by the forward-looking statements (and from past results, performance or achievements). These factors include the failure to complete and commission the mine facilities, processing plant and related infrastructure in the time frame and within estimated costs currently planned; variations in global demand and price for molybdenum and copper; fluctuations in exchange rates between the U.S. dollar and the Australian dollar; failure to recover the resource and reserve estimates of the Project; the failure of Moly Mines' suppliers and service providers to fulfill their obligations under construction, supply and tolling agreements; unforeseen geological, physical or meteorological conditions, natural disasters or cyclones; changes in the regulatory environment, industrial disputes, labor shortages, political and other factors; the inability to obtain additional financing, if required, on commercially suitable terms; and global and regional economic conditions. Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information

Contacts:

Moly Mines Limited

Natalie Frame

Investor Relations

+1 416 777 1801 or +1 416 371 7541


Moly Mines Limited

Derek Fisher

Managing Director

+61 8 94293300
www.molymines.com