Mines Management Announces Final Approval to Move Forward with Underground Evaluation Program at the Montanore.

SPOKANE, Wash. -- Mines Management, Inc. (AMEX:MGN) (TSX:MGT) is pleased to announce that it has received final approval to move forward with underground evaluation and drilling activities at the Montanore Silver-Copper Project in northwestern Montana.

Final approval was received for a minor revision to the Hard Rock Operating Permit to resume exploration and drilling activities at the Libby Adit following review by the Montana State Department of Environmental Quality ("DEQ"). This authorization allows dewatering, adit rehabilitation, exploration, and drilling activities for the Montanore Project. Activities at the site may begin immediately.

Mines Management's President and CEO, Mr. Glenn M. Dobbs, commented, "We are very pleased with the final approval as it allows us to move ahead with another major step in developing a bankable feasibility study. We also hope to further delineate the thicknesses of the mineralized zones, which could have a positive impact to capital and operating costs for the project."

The initial approval by the DEQ of the first minor revision was announced on July 25, 2006, which approval allowed the Company to re-open and assess the condition of the Libby Adit. Having completed this activity, Mr. Eric Klepfer, the Company's Vice President of Operations, stated, "It appears that the first 600 feet of the adit is in good condition and will need little rehabilitation work. Water quality samples collected also show minimal issues for the dewatering phase. Bench scale water treatability analysis has also been completed preparing for the next important step of pilot scale test work."

The underground evaluation program was initiated following the Company's May 2006, acquisition of the U.S. subsidiaries of Noranda Minerals of Canada, which included the existing Operating Permit #00150 and MPDES Permit #0030279. Both permits were originally issued in 1993, were kept current, and remain in force. Exploration activities were originally approved in April 1989, and the MPDES Permit was renewed as recently as March, 2006.

Underground Evaluation Program

The objectives of the Underground Evaluation Program are to:

* Expand the known higher grade zones of the deposit

* Develop additional information about the deposit to support a bankable feasibility study

* Assess and define the mineralized zone that extends beyond the current resource boundary

* Provide additional data for geotechnical, hydrological and other information required to complete a final, bankable feasibility study

The Underground Evaluation Program is designed to include the following activities:

* Dewatering and rehabilitation of the adit

* Re-installation of services and infrastructure including electricity, ventilation, pumps and pipeline, and associated surface facilities

* Extension of the adit by an additional 3,000 feet

* Development drifting of approximately 10,000 feet to establish drill stations

* Diamond core drilling of approximately 45,000 feet

The Libby Adit was constructed by Noranda between 1989 and 1991, but remained uncompleted following cessation of activities and closure in the mid-1990's. The adit consists of a 6% decline approximately 14,000 feet in length, 18 feet high and 18 feet wide.

The evaluation project is expected to initially employ an additional five local workers, increasing as the project advances. In recent years, Lincoln County has suffered from one of the highest unemployment rates in the state as a result of a declining local and regional natural resource industry. If the mine were built at the Montanore, it would be expected to employ 250-300 people.

The communities of Libby and Lincoln County have expressed their support for the Montanore Project, including sending a delegation to the state's Capital to appeal to the Governor who expressed his support for the Project in early 2005. On August 2, 2006, the State's Director of Economic Development expressed the Governor's continued support at a re-opening ceremony for the Libby Adit attended by representatives from the U.S. Forest Service and approximately 100 local representatives and community leaders.

Mines Management, Inc. is a U.S.-based mineral company focused on the exploration and acquisition of precious and base metals mineral deposits. The company's primary focus is on the advancement of the Montanore Silver-Copper Project located in northwestern Montana. The Montanore Project is currently undergoing environmental assessment as part of the development of an Environmental Impact Statement and the NEPA process, which are necessary to gaining full permits to develop and conduct commercial mining activities. An underground evaluation program has been initiated as part of the development of a final, bankable feasibility study.

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 the anticipated timing, process and scope of the underground evaluation and drilling activities and the anticipated completion of a bankable feasibility study. 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 economic and political events affecting supply of and demand for silver and copper, 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, 2005. Additional information is available on the Company's website at www.minesmanagement.com.