MINES MANAGEMENT, INC. (NYSE Amex:MGN) (TSX:MGT) is pleased to announce results for 2008.

Overview

2008 Highlights

• Received notice from Montana Department of Environmental Quality (DEQ) confirming that the Hard Rock operating permit 150, originally issued in 1993, was transferred to the Company with the acquisition of the Noranda Minerals Corporation in 2006.
• Received approval from the Montana State Department of Commerce of the proposed Hard Rock Mining Impact Plan for the Montanore Project.
• Engaged Small Mine Development as contractor to manage activities related to advancement of the Libby adit and drill station development.
• Excavated two sumps and placed them into service as part of the adit dewatering system in August 2008.
• Awarded the engineering contract for the water treatment plant nitrate circuit, which will be installed beginning in May 2009.
• Completed and released draft Environmental Impact Statement for public comment in February 2009.

Our December 31, 2008 cash, unrestricted certificates of deposit, and available line of credit balances remained strong at over $20 million. Our net cash expenditures for operating activities for 2008 totaled $8.9 million. Cash outlays were less than projected due to delays in the USFS approval of our EA. We purchased fixed assets totaling $0.9 million, including two underground refuge chambers and three surface utility trucks. Construction in process spending for 2008 was $0.2 million for construction of site infrastructure.

In 2009, we plan to continue to focus on our planned advanced exploration and delineation drilling program at the Montanore Project. We also intend to continue to pursue the re-permitting applications with the goal of having sufficient data to commence preparation of a phased financing plan for the Montanore Project. We plan to engage a contractor to begin preparation of a bankable feasibility study for the Montanore Project in the fourth quarter of 2009. If additional capital is required and market conditions are not conducive to effective capital raising, management may elect to curtail development activities to conserve cash until conditions improve. Similarly, development activities could be deferred if the permitting process is delayed or if commodity prices make the project difficult to finance or increase the expense of such financing.

Financial and Operating Results

Mines Management, Inc. reported a net loss for the year ended December 31, 2008 of $10.3 million or $0.45 per share compared to a loss of $8.3 million or $0.46 per share for the year ending December 31, 2007. The increase of $2.0 million in net loss between 2008 and 2007, and the 2007 net loss increase of $2.3 million versus 2006, were primarily due to increased depreciation on capital investments and administrative expenses in support of the Montanore Project:

Montanore Project Expense includes exploration, fees, filing and licenses, and technical services, including environmental, engineering and permitting expense. The increases in 2008 were mainly due to permitting efforts for the Montanore Project and the preparations to begin the dewatering and rehabilitation of the Libby adit. The increase included $150,000 for additional studies and incorporation of USFS and DEQ comments in the draft EIS which was issued for public comment in late February 2009, and payments to Small Mine Development in the third and fourth quarters for underground sump construction and pump installations.

Administrative expense, which includes general overhead and office expense, legal, accounting, compensation, rent, taxes, and investor relations expense, increased in 2008 due to increased fees paid to our directors and full year salaries for four additional supervisory mine site employees. These costs were offset by reduced outside consultant fees for land claims and the absence in 2008 of payment of $500,000 for the MRC royalty, which was paid in 2007. Depreciation increased in 2008 because there was a full year of depreciation on equipment purchased in late 2007. Stock option expense increased $300,000 because of additional option grants in 2007 which were recorded in 2008 upon approval by shareholders of the 2007 Stock Option Plan at the May 2008 annual meeting.

Liquidity and Capital Resources

At December 31, 2008, our aggregate cash, short term investments, and long term investments totaled $20.3 million compared to $32.6 million at December 31, 2007. Cash flows from financing activities were $2.4 million in 2008, including $1.8 million from a line of credit and $0.8 million from the exercise of options and warrants. The net cash used for operating activities during 2008 was $8.9 million, which consisted primarily of permitting, environmental, exploration, and engineering expenses for the Montanore project and general administrative expenses. Cash used in investing activities was $7.8 million. We purchased a $5.0 certificate of deposit and $1.8 on available-for-sale securities. The net decrease in cash and cash equivalents for the year ending December 31, 2008 was $14.3 million.

We anticipate expenditures in 2009 of approximately $14.0 million, which we expect will consist of (i) $1.5 million in each quarter for ongoing operating and general administrative expenses, (ii) $1.0 million in the first quarter for ongoing preparation expenses for the exploration and delineation drilling program at the Montanore Project and (iii) $2.3 million in each remaining quarter to sustain efforts in furtherance of the program. We will require $10.0 million of external financing in 2009 and 2010 to fund the completion of the advanced exploration and delineation drilling program and completion of a bankable feasibility study.

Mines Management, Inc. is a U.S.-based mineral exploration company in the business of acquiring, exploring and developing precious and base metals deposits. The Montanore Silver-Copper Project is the Company’s primary focus, and is located in northwestern Montana.

FORWARD-LOOKING STATEMENTS - Some information contained in or incorporated by reference into this release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements include comments regarding further exploration and evaluation of the Montanore Project, including planned rehabilitation and extension of the Libby adit, drilling activities, feasibility determination, engineering studies, environmental and permitting requirements, process and timing, and estimates of mineralized material and measured, indicated and inferred resources; financing needs; the markets for silver and copper; planned expenditures in 2009 and 2010; and potential completion of a bankable feasibility study. The use of any of the words "anticipate," "estimate," "expect," "may," "project," "should," "believe," and similar expressions are intended to identify uncertainties. We believe the expectations reflected in those forward-looking statements are reasonable. However, we cannot assure that the expectations will prove to be correct. Actual results could differ materially from those anticipated in these forward-looking statements as a result of the factors set forth below and other factors set forth and incorporated by reference into this report: Worldwide economic and political events affecting the supply of and demand for silver and copper, and the availability and cost of financing for mining projects; Volatility in the market price for silver and copper; Financial market conditions and the availability of financing on acceptable terms or on any terms; Uncertainty regarding whether reserves will be established at Montanore; Uncertainties associated with developing new mines; Variations in ore grade and other characteristics affecting mining, crushing, milling and smelting and mineral recoveries; Geological, technical, permitting, mining and processing problems; The availability, terms, conditions and timing of required governmental permits and approvals; Uncertainty regarding future changes in applicable law or implementation of existing law; The availability of experienced employees; The factors discussed under "Risk Factors" in this Annual Report on Form 10-K for the period ending December 31, 2008.

Mines Management, Inc.
Vice President Corporate Development & Investor Relations
Douglas Dobbs, 509-838-6050
info@minesmanagement.com