Mill City/Golden Hill-Million-Ounce Plus Potential Golden Hill Cuba.

CALGARY, Alberta--(BUSINESS WIRE)--Jan. 7, 1997--Mill City Gold (VSE MIY.) Golden Hill Mining (CANADIAN DEALING NETWORK GHMC. ) GOLDEN HILL MINING CORP. (GHMC-CDN) and MILL CITY GOLD MINING CORP. (MIY-VSE) are pleased to announce further results released by MacDonald Mines Exploration Ltd., the Operator of our jointly owned east-central Cuban gold property.

MacDonald Mines has recently announced the following:

"Ongoing diamond drilling at the Golden Hill gold-copper discovery of MacDonald Mines Exploration Ltd. (MMP.A - ASE) in east-central Cuba is yielding further positive results. A 17-hole program recently completed on the Three Hills zone has identified a size potential similar to the Little Golden Hill zone located 750 metres east and defined last year.

"The Three Hills gold oxide and gold- copper sulphide zones remain open in several directions and an additional 10 drill holes are planned to start by the middle of January.

"A 23-drill hole program is nearing completion on two zones, the Quartz-Alunite and the Castle Rock zones, located on Big Golden Hill. On Big Golden Hill the oxide zone is up to 75 metres (246 feet) thick and the potential for a large gold oxide resource exists.

"Other targets to be drilled at the discovery include a coincident, large ground geophysics and gold-in-soil anomaly located 1.2 kilometres east of Big Golden Hill and referred to as Anaomaly A. Within the Golden Hill anomaly, which covers a 2.5 square kilometre area (approximately 1 square mile), five near-surface gold oxide zones have been identified.

"These near surface gold oxide zones, and other assumed but undiscovered zones, will be further delineated by diamond drilling in the next five months with the aim of producing a positive feasibility study for a heap leach gold operation.

"The gold enriched near-surface oxide zones at Golden Hill are the surface expressions of a large gold and copper rich sulphide deposit. MacDonald's exploration to date has concentrated on the near-surface, gold-in-oxide zones.

"A total resource potential of greater than 40 tonnes of gold (1.3 million troy ounces) together with many millions of pounds of copper, is indicated.

"Resources calculated to date by Company geologists, from last year's analytical results only, include more than 7 tonnes of gold (226,602 troy ounces) and 50,578,000 lbs. of copper (having a gold equivalent value of approximately 147,500 troy ounces).

"Initial cyanidation tests indicate high gold recoveries from both oxide, ranging from 93 to 99 percent, and from sulphide, ranging from 85 to 93 percent, all with low cyanide consumption and a short activation time.

"An ongoing feasibility analysis has established target tonnages and grades required to commence an economic heap-leaching operation. These tonnages and grades now appear to be achievable from the current season's planned program, based on all results to date.

"The foregoing resource estimates relate only to the Golden Hill and Florencia Sector target areas. Considerable potential for the discovery of further new gold and copper resources exist in the Maclama, Tres Casas and Palo Seco target areas, which will all be drill tested in the current season's program.

"Company geologists believe the possiblity is very high that an extensive skarn type system will be identified at the Maclama area in this season's drilling program, in addition to the augmentation of existing resources at Golden Hill and Florencia, now underway.

"The company is presently negotiating, with underwriters, the terms of a $30,000,000 convertible preferred share issue to finance development and production."

As previously announced on Oct. 10, 1996 and Nov. 27, 1996, MacDonald and Golden Hill have agreed, subject to any required regulatory approval, to proceed with a take-over bid by MacDonald to acquire all of the issued and outstanding shares of Golden Hill on the basis of MacDonald issuing 0.75 MacDonald common shares and 0.2045 MacDonald Share Purchase Warrants for each common share of Golden Hill.

The Oct. 9, 1996 letter agreement requires such regulatory approval be obtained by Jan. 31, 1997. Golden Hill Mining Corp. is approximately 42 percent held by Mill City Gold Mining Corp. -0- None of the Canadian Dealing Network Inc., the Vancouver Stock Exchange, or The Alberta Stock Exchange have approved or disapproved the information contained herein.

CONTACT: Mill City Gold Mining Corp.

Larry D. Revitt, 403/278-8500

403/278-8580 (FAX)

or

MacDonald Mines Exploration Ltd.

Thomas A. Smeenk, 416/865-1625

416/865-9386 (FAX)

or

Golden Hill Mining Corp.

Larry D. Revitt, 403/278-8500

403/278-8580 (FAX)