Mandalay Resources completes acquisition of the La Quebrada copper-silver
deposit and files Cerro Bayo technical report

TORONTO, May 17 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX-V: MND) is pleased to announce that it has completed the acquisition of 100% interest in the La Quebrada copper-silver deposit near La Serena, Chile. The acquisition was completed by issuing Inversiones y Mineria Andale Ltda. ("Andale"), the property owner, a final tranche of 400,000 Mandalay shares under an amended option agreement described in press releases dated April 15, 2009 and August 13, 2009. There remains a 2% royalty to Andale on future possible production from the property.

Mandalay has filed an NI 43-101 report on www.sedar.com documenting its recent work at La Quebrada (see press release dated April 15, 2010). The property is now ready for the next round of drilling, anticipated to start upon completion of environmental permitting, with the purpose of defining a maiden NI 43-101 mineral resource estimate by the end of 2010. Upon issuance of these new shares, Mandalay now has 99,392,850 shares outstanding.

The Company also announces the completion of the Cerro Bayo NI 43-101 technical report, now available on www.sedar.com. Refer to press release dated May 4, 2010 for details on the Company's definitive purchase agreement with Coeur d'Alene Mines Corporation where it announced that it will purchase 100% of Coeur's wholly-owned subsidiary Compania Minera Cerro Bayo Ltda. The principal asset of Minera Cerro Bayo is the Cerro Bayo silver-gold mine in Patagonia, Chile, currently on care and maintenance.

    
    About Mandalay Resources Corporation:
    -------------------------------------
    

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 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. 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, Mandalay's ability to secure additional financing, 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. 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.

THE TSX VENTURE EXCHANGE HAS NOT YET REVIEWED AND DOES NOT TAKE RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE CONTENT OF THIS NEWS RELEASE.

For further information: Bradford Mills, Chief Executive Officer, Greg DiTomaso, Investor Relations, Contact: [phone], Email: [email protected]