Mines Management Announces 2006 Results.

SPOKANE, Wash. -- Mines Management, Inc. (AMEX: MGN)(TSX: MGT) is pleased to announce financial results and an operational update for the year ending December 31, 2006.

2006 Highlights

* Completed listing of our common stock on the Toronto Stock Exchange, effective January 10, 2006.

* Received independent estimate of mineralized material and mineral resources from Mine Development Associates on March 1, 2006 and filed a report under Canada's National Instrument 43-101, reporting mineral resources at Montanore.

* Completed initial Montanore Project mining and milling cost studies by Hatch of Vancouver, identifying critical areas of focus for project improvement and development.

* Acquired two Noranda subsidiaries holding Hard Rock Operating Permit 150 and MPDES water discharge permit for exploration drilling, and title to the properties at the portal site of the Libby adit.

* Reopened Libby Adit, installed site facilities.

* Filed a $65 million shelf registration statement with the Securities and Exchange Commission, which became effective June 27, 2006.

* Continued drafting of the Montanore Project Environmental Impact Statement, in cooperation with the U.S. Forest Service, independent consultants and the Montana Department of Environmental Quality ("MDEQ").

* Received final approval on November 28, 2006, for a minor revision to Hard Rock Operating Permit 150 to resume exploration and drilling activities at the Libby adit following a review by the MDEQ.

* Conducted the first phase of the re-opening of the Libby adit portal and preliminary evaluation and water quality tests in the third quarter of 2006.

* Our year end cash and certificates of deposit balance remained strong at over $5.1 million.

* Our net cash expenditures for operating activities for the year 2006 totaled $4.9 million, as expected.

In 2007, the Company plans to focus on commencement of an underground evaluation drilling program at the Montanore Project's Libby adit located in northwestern Montana. The Company intends to continue its emphasis on the re-permitting applications and commencement of a phased financing plan for the Montanore project. The Company will require additional capital to complete the proposed $40 million evaluation and drilling program starting in early 2007.

Financial and Operating Results

Mines Management, Inc. reported a net loss for the year ended December 31, 2006 of $6.0 million or $0.47 per share versus a loss of $5.2 million or $0.45 per share and $2.5 million or $0.26 per share for the years ending December 31, 2005 and 2004, respectively. The 2006 increase in net loss versus 2005 of $0.8 million and the 2005 net loss increase versus 2004 of $2.7 million, were primarily due to increased expenditures in Montanore Project and administrative expense:

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Montanore project expense includes exploration, fees, filing and licenses, environmental, engineering and permitting expense. Increased activity on the Montanore Project was primarily the result of increased payments to consultants for permitting activities, collecting additional environmental baseline data, mineralized material and resource studies, and exploration activities related to reopening the Libby adit. Administrative expense, which includes general overhead and office expense, legal, accounting, compensation, rent, taxes, and investor relations expense, increased $0.5 million or 22% in 2006 over 2005 as we added two additional staff members, increased legal and accounting fees due to increased regulatory requirements and implementation of Sarbanes-Oxley Act of 2002 reporting on internal controls as an accelerated filer for 2006, and a general increase in the Company's activities. Stock option expense, which includes stock options granted to officers, employees and consultants, remained approximately unchanged from 2005 to 2006, while interest income increased slightly due to a full year of interest for certificates of deposit purchased in October of 2005.

The major area for additional spending for 2005 over 2004 was the increased activity on the Montanore Project, primarily as a result of increased payments to consultants for permitting activities, collecting additional environmental baseline data, mineralized material and resource studies, and mine engineering and optimization. Administrative expense doubled in 2005 over 2004 as we commenced an investor relations program targeted at increasing liquidity, hired additional employees for the Montanore Project, and leased additional office space in January 2005 to accommodate our expanded staff. Stock option expense, which includes stock options granted to officers, employees and consultants, decreased from 2004 to 2005 due to fewer options being granted and no previously issued options vesting in 2005.

Liquidity

At December 31, 2006, our aggregate cash, short term investments, and long term investments totaled $5.2 million compared to $8.9 million at December 31, 2005. In 2006, we received $1.5 million from the exercise of warrants and stock options. The net cash used for operating activities was $4.9 million, which consisted primarily of permitting, environmental exploration, and engineering expenses for the Montanore project and administrative expenses. The net decrease in cash and cash equivalents for the year ending December 31, 2006 was $3.9 million.

We anticipate spending approximately $1.0 million each quarter in 2007 for ongoing operating expenses and an additional $5.0 million per quarter for the evaluation drilling program starting with the second quarter of 2007 for estimated total 2007 expenditures of approximately $19.0 million. The Company will require external financing in 2007 to fund the evaluation drilling program.

This press release contains forward-looking statements regarding the Company, within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, including statements regarding commencement of the planned underground evaluation drilling program and estimated expenditures in 2007. These statements are based on assumptions that the Company believes are reasonable but that are subject to uncertainties and business risks. Actual results relating to any and all of these subjects may differ materially from those presented. Factors that could cause results to differ materially include fluctuations in silver and copper prices, negative results of environmental studies, problems or delays in or objections to the permitting process, the proximity of the Project to the Cabinet Wilderness Area, failure or delay of third parties to provide services, changes in the attitude of state and local officials toward the Montanore Project and other factors discussed in the Company's periodic filings with the Securities and Exchange Commission, including its annual report on Form 10-K, as amended, for the year ended December 31, 2006.