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Arehada Mining Limited

Friday, July 27th, 2007

Arehada Mining Limited announce that it will offer to sell, on a non-brokered private placement basis, up to 12 million units, with each unit consisting of one common share and one half of one common share purchase warrant of the Company, to raise gross proceeds of up to $6.0 million. The exercise price of each full warrant is $0.75 per share, exercisable at any time during the two year term of the warrant. If the Company’s share price closes at $1.50 for 20 successive days, the expiry date of the Warrants will be accelerated to the 10th business day following notice of the Company to the Warrant holders.
The offering, which remains subject to receipt by the Corporation of all necessary regulatory and third party approvals, is scheduled to close on or about August 7, 2007.
Net proceeds realized by Arehada under the Offering will be used to purchase sufficient quantities of zinc concentrate feedstock to commence production at the Company’s newly completed zinc processing plant located in Inner Mongolia, China. Once in production, the zinc processing plant will process concentrate produced at Arehada’s zinc-lead-silver mine as well as concentrate from other regional miners in Inner Mongolia, to produce zinc oxide and sulphuric acid.
“As a direct consequence of building the processing plant, the regional government of Inner Mongolia has mandated that all other local producers will use our facility,” said Chris Harrop, Chairman of the Company. “Our plan is to begin production of zinc oxide at the plant as soon as possible and, within the next year, ramp up to the 50,000 tons per annum rated capacity. Ultimately, we also plan to add a refinery to the plant to enable production of LME quality zinc and the rare earth element, Indium.”
A significant portion of the concentrate that will be used at the plant will come from Arehada’s mine which began production in 2006 and is ramping up to capacity. The Company is expanding the mine and on-site mill to reach the 3,000 tons per day level during the fourth quarter of 2008. Among the improvements being made at the mine to reach this level is the sinking of an additional vertical shaft, the opening of new work faces and an increase in the workforce. All these measures are being financed internally from cash flow generated by operations.

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