Silver Dragon Reports on 2011 Exploration Results and Discloses 2012 Exploration and Development Plans for Its Laopandao Silver-Polymetallic Project

BEIJING, April 10, 2012 (GLOBE NEWSWIRE) -- Silver Dragon Resources Inc. SDRG ("the Company") is pleased to announce that it has completed a geological report on the results from the 2011 exploration program at its Laopandao silver-copper-tin polymetallic project in Inner Mongolia, Northern China.

After five years of exploration, Laopandao has evolved into an advanced exploration project with a completed initial NI 43-101 compliant resource estimate, and a metallurgical analysis in progress. An extensive underground tunnel system has been constructed and a drilling, trenching & tunneling program is well underway with a total of 7,174 meters of surface trenching, 14,632 meters of diamond drilling, and 2,822 meters of underground exploration-development (tunneling) completed to date. Some of the highlights from the report are as follows:

• In 2011, the exploration work focused on mineralization zone III and included 308 meters tunneling, 192 pieces of sampling and assaying, as well as hydrogeological, engineering, geological, and environmental surveys within the property demonstrating a potential viable operation.
   
• Exploration to date has demonstrated economic tin resources in mineralization zone III with more than 1% tin discovered in many areas including in mineralized bodies III-10 and III-12. (See Tables 2 & 3).
   
• 21 mineralized bodies have been defined in mineralization zone III with several mineralized bodies of tin defined by tunneling (See Figures 1 & 2).
   
• The recalculation of tin resources in mineralization III shows the total amount of polymetallic ore reaching 2,657,105 metric tonnes (332 [indicated] + 333 [inferred] category resources following Chinese Geological Exploration Standards) with 11,383 metric tonnes (25 million pounds) of tin, demonstrating significant resource potential.
   
• Two groups of samples have been collected for metallurgic testing. The test results are expected during the second quarter of 2012, which will provide basic economic parameters for a pre-feasibility study.
   
• In 2012, further exploration plans, including drilling and tunneling have been designed to establish resources with higher categories. Plans to convert these Chinese resource estimates into National Instruments 43-101 standards have also been made.

A note on resource estimates: 

Resource estimates are divided into different categories based on Chinese National Non-ferrous Metal Resource Estimation Standards. Category 332 is an estimate defined by surface trenching, drilling and tunneling with advanced exploratory grids. Category 333 is an estimate defined by a single exploration project (surface trench, drill hole or drift) and the grades and thickness of the mineralized body are inferred based on average grades and thickness of all exploration projects used for resource estimation. Category 334 is inferred based on the mineralization area and a single exploration project (prospective resources).  Category 332 has relatively higher accuracy and reliability and may be equivalent to indicated resources by CIM standards.

The Laopandao Silver-Copper-Tin deposit is the second property of interest for Silver Dragon in China. After five years of exploration, it has developed from an initial exploration property to an advanced exploration target, with its silver, copper, and tin resources showing significant economic potential.

Based on the annual exploration report of the Laopandao property in 2011, major exploration focused on mineralization zone III and the completed exploration projects included 308 meters tunneling. As well, channel sampling within the adit (ore drift and cross cut) was completed, and 192 samples were collected and analyzed. Meanwhile, hydrogeological, engineering, geological, and environmental surveys and a 1:2,000 mapping were completed to provide basic information for further development of exploration of the project.

According to new data obtained in 2011, new exploration achievements in mineralization zone III are as follows:

Through tunneling at adit PD3 (located at 1,620 meters elevation), tin mineralized bodies no. 10, 12, 14, 15, 16, 17, and 18 became better defined. At the same time, several new mineralized bodies have been identified (Fig. 3). Transverse drift no. 304 (CM304) reveals a 68 meter wide alteration zone and 11 mineralized bodies with a total true thickness of 19 meters. Within those mineralized bodies, the grades of tin range from 0.1% to 1.0% and the highest grade is 1.31%. At transverse drift no. 300, a 0.9 meter thick silver-copper mineralized body, assaying Ag 59.8 g/t and Cu 1.9%, was discovered. Mineralized body no. III-19 occurs at 400 meters below the surface (Fig. 4), showing significant potential.

Based on the new findings, revised estimations of tin resources in mineralization zone III were made and historical resources redefined. A summary of the revised estimates can be found in Table 1.

Table 1 - Resource estimates for Laopandao

Two groups of samples have been collected for metallurgical testing. The first group of samples were collected from mineralization zones I and II, which are characterized by silver, copper and tin mineralization; the second group of samples were collected from mineralization zone III, which is characterized mainly by tin mineralization. The samples were shipped to the laboratory of Beijing General Research Institute of Mining and Metallurgy (www.bgrimm.com) for metallurgical (ore processing) testing.  The results are expected during the second quarter of 2012. The ore processing tests will provide basic economic parameters for pre-feasibility study, and may also be used for guiding further exploration.

The results of hydrogeological, engineering, geological and environmental surveys show that the hydrogeological state at Laopandao is simple with major ground water coming from the fissure system with a maximum inflow of 200 ~ 300 cubic meters per day; the stability of the hanging wall and the foot wall of mineralized bodies is good for mining; the quality of environmental geology is appropriate for property development.  

In 2012, exploration will continue to be focused on mineralization zone III with 4,000 meters of drilling and 500 meters of tunneling planned for testing of several geophysical anomalies in order to identify further mineralization zones. Upon receiving the results of the ore processing tests, a pre-feasibility study and mining license application is planned. The budget of the exploration plan for 2012 is shown in Table 4.

Table 2 - Average thickness calculation of mineralized block (mineralization zone III) at Laopandao

 Table 3 - Tin resource estimation of mineralization zone III of Laopandao Property

 Table 4 – 2012 Exploration Budgets for Laopandao

Images referenced in this press release

Figure 1 – Longitudinal Section of Mineralized Body III-10 at Laopandao

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Figure 2 – Longitudinal Section of Mineralized Body III-12 at Laopandao

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Figure 3 - Plan map of the PD3 tunnel system at mineralization zone III at Laopandao

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Figure 4 - Geological profile of exploration line no. 304 at Laopandao

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Dr. Tiebing Liu, P. Geo., a "qualified person" within the meaning of NI 43-101, reviewed and participated in the preparation of the technical information disclosed in this news release.

About the Laopandao Tin-Silver Polymetallic Project

Laopandao is one of the six exploration properties of Sanhe Sino-Top Resources and Technologies Ltd. ("Sino-Top"), a Chinese company that holds exclusive exploration rights to these properties, located in the prolific Erbahuo Silver District in Inner Mongolia, China. The Company has a 40% ownership interest in Sino-Top. The Laopandao exploration area covers 44.88 square kilometers and is located approximately 650 kilometers north by northeast of Beijing in Chifeng, Inner Mongolia. See Project location Map at the following link:

http://silverdragonresources.com/_img/China_Project_Location_Map.jpg

Mineralization zones have been identified in the northern, central, and southern portions of the exploration area. The most significant recent discovery was the existence of silver-tin-copper-lead mineralization on the peripheries of a previously identified tin mineralized zone. The mineralization is mainly a continental volcanic-sedimentary rock altered strata-bound mineral type.

An initial deposit modeling resource estimate has been completed for the Company's Laopandao Tin-Silver Polymetallic project in accordance with Canadian Securities Administrators National Instrument 43-101 Standards of Disclosure for Mineral Projects prepared by Southampton Associates Inc. of Toronto, Canada (see press release of December 7, 2011)

About Sino-Top – China Mining 2009 Award Winner

Sanhe Sino-Top Resources & Technologies, Ltd. ("Sino-Top'') was incorporated in 2003 as a Chinese company wholly-owned by Huaguan Industrial Corp. ("HIC''), a subsidiary of the state-owned North China Geological Exploration Bureau. Silver Dragon Resources Inc. acquired Sino-Top in 2006, and currently owns 40% of Sino-Top. The Chinese partners, Gansu Shengda Group Ltd. – 52%, and HIC – 8%, together own 60% of Sino-Top. Sino-Top holds exclusive exploration and development rights to six properties in northern China (Inner Mongolia), covering a total area of 139 km². Sino-Top won the prestigious Prospector/Explorer of the Year Award for its Dadi silver polymetallic project, at the China Mining Congress & Expo 2009.

About Silver Dragon Resources Inc.

Silver Dragon Resources Inc. is a mining and metals company focused on the exploration, acquisition, development and operation of silver mines in proven silver districts globally. Silver Dragon's objective is to acquire silver mining assets that contain promising exploration targets, have highly leveraged, out-of-the-money silver deposits, and/or are producing properties with significant untapped exploration potential. It is management's objective to grow Silver Dragon into a significant silver producer by developing, its six Sino-Top properties in China (particularly Dadi and Laopandao), and its Erbahuo Silver mine (via its Chifeng Silver Dragon subsidiary), also in China. For more information, please visit the Company's website at: www.silverdragonresources.com (available in Chinese).

The Silver Dragon Resources Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4242

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained herein which are not historical, such as statements regarding the exploration and development of the Dadi silver-polymetallic project, outcome and timing for the completion of further assays and metal amounts in partial assay results, are forward-looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "aims," "potential," "goal," "objective," "prospective," and similar expressions, or that events or conditions "will," "would," "may," "can," "could" or "should" occur.

Information inferred from the interpretation of assay results and information concerning mineralization zones may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, certain delays beyond the company's control with respect to future assay results, delays in testing and evaluation of assays, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.