Liberty Mines Inc.

Liberty Mines Inc. is a producer of nickel and is focused on the exploration, development and production of nickel, copper, cobalt and platinum group metals from its properties in Ontario, Canada. Liberty has four major assemblies of contiguous mining claims and leases in northern Ontario including:

• A 100% interest in the 12,000 ha Shaw Dome Nickel Belt located 25 km southeast of Timmins containing three mines: the Redstone nickel mine in commercial production; the McWatters nickel mine located 9.5 km east of the Redstone Mine soon to be in pre-production; and the Hart nickel mine in the permitting stage. The 2000 tonne/day Redstone nickel concentrator is located at the Redstone Mine site;
• A 100% interest in the 6,400 ha Groves nickel copper platinum group metals (“PGM”) project 20 km southeast of Gogama;
• An option to earn a 100% interest in the 6,600 ha Sothman nickel deposit 75 km south of Timmins; and
• A 100% interest in the 6,300 ha McAra Lake-Ray cobalt nickel copper project about 120 km south east of Timmins.

Redstone Mine

Underground drilling at the Redstone mine was completed in April 2007 to the 508m level to enable a National Instrument 43-101 resource calculation to be done. A measured (274,085 tonnes) and indicated (144,846 tonnes) resource of 418,931 tonnes grading 2.32% nickel ("Ni") to and above the 508m level of the mine was released on December 18, 2007. An updated 43-101 technical report is scheduled to be released in 2009. Construction of the shaft surface infrastructure is complete. Once the shaft is sunk to the 1150m level, the deeper mineralization can be mined at a reduced cost and increased tonnage. Due to low nickel prices, the mine is currently on care and maintenance.

Eleven boreholes drilled in 2007 from the 789m to 1155m levels have confirmed a large section of the “Inco Anomaly” tested within the Redstone channel (see Redstone Project) is a nickel bearing orebody. More drilling is required to test the entire extent of the geophysical anomaly below 1150m and further to the west at depth. Some highlights of the deep drilling include:

3.45m of 3.9% Ni at the 675m level;
8.5m of 2.4% Ni at 789m below the surface; and
4.65m of 3.62% Ni encountered 1064m below the surface.

Redstone Nickel Concentrator

The 2000 tonne per day Redstone nickel concentrator was commissioned in July 2007. It will initially operate at approximately 450 tonnes per day until the McWatters nickel mine ramps up to full production. The mill contains a sophisticated flotation circuit to effectively separate nickel sulphides from the high magnesium hydroxide (talc) component typical of altered komatiite nickel mineralization in the Shaw Dome Nickel Belt. It is fully automated including an online analyzer which can isolate both light and heavy elements. It also contains a gravity circuit to enhance the payable amounts for platinum, palladium and gold.

Liberty ships its nickel in concentrate to Jilin Jien Nickel Industry Company Ltd. of China and to Xstrata Nickel’s smelter in Sudbury, Ontario.

McWatters Mine

Construction began in mid November 2007 at the McWatters nickel mine, located approximately 9 km to the east of the Redstone Mine. The ramp is completed to the 105m level. Once development continues, it will take about 3 months to complete the ramp to the bottom level at 155m. Definition drilling was completed in November 2007 and a technical report to NI 43-101 standards was posted on Sedar December 18, 2008. Due to low nickel prices, the mine is currently on care and maintenance.

Hart Mine

Drilling commenced in March 2007 at the Hart nickel project which is located about 6 km east of the Redstone Mine. The first phase of drilling was completed in May 2008 which defined the bulk of the mineralization to the 500m level. The mineralized body has been defined with an average strike length of approximately 265m that can be subdivided into two zones based on sulphide content and mineralized zone width: the upper zone contained within the top 275m below surface, and the lower zone found below this elevation. A NI 43-101 resource calculation, which was released on Sedar October 20, 2008, stated an indicated resource of 1,390,000 tonnes grading 1.50% Ni and 0.1% Cu and an inferred resource of 286,000 tonnes grading 1.36% Ni and 0.09% Cu. These tonnages represent the largest NI 43-101 compliant resource in the Shaw Dome identified to date with an average grade of 1.5% Ni. The resource calculation included drilling only to the 460m level. Drilling will commence as soon as possible to bring the inferred resource into the indicated category. Mineralization is also known to exist down to the 550m level, so additonal deep drilling will attempt to extend the resource at depth. The Hart deposit will become Liberty's third nickel mine; application for a mining lease has been submitted and permitting of the project is in progress.

The geology of Liberty's properties at the Shaw Dome Nickel Belt is similar to the Kambalda Nickel Belt in Australia where several pods of rich ore have been mined since the mid 1960's. There is a good probability of finding more pods like the Redstone, McWatters and Hart deposits on those claims.

Groves Nickel Copper PGM Project

The Groves nickel copper PGM (Platinum Group Metals) deposit, located 15 km southeast of Gogama Ontario, was assembled by staking around the main historical ore zone owned 100% by Liberty. The contiguous claim block now covers an anomaly 12 km long and appoxiamtely 2 km wide (see Groves Project). In addition to the historical resource, Liberty has singled out 3 additonal prime targets that will be drilled in 2008-2009.

Sothman Nickel Copper Project

The Sothman nickel copper deposit, located approximately 75 km south of Timmins Ontario, was optioned from Xstrata. An historical resource was reported by Falconbridge Nickel in 1971 (see Sothman Project). Exploration at the property began in June 2008.

McAra Lake Cobalt Copper Project

The company has some high grade cobalt properties near Shining Tree, approximately 120 km south of Timmins. Rich veins in the system fed a deposit averaging approximately 1.1% cobalt which is more prospective than most sources of cobalt in the world (cobalt normally occurs in deposits as a 0.02% by-product of nickel ores or as a deposit associated with copper ores with a 0.4% cobalt grade).

A copper zone was also discovered grading 11.9% copper over 3.1m. The McAra deposit is a very prospective exploration project that can be brought into production.

The adjacent Ray claim block to the east could also add additonal tonnage to a cobalt-nickel-copper resource. There are several surface pits on the property which typically yield 0.3% Ni and 0.3% cobalt.

Liberty also owns 752 ha of prospective gold claims in Whitney and Cody Townships near Timmins Ontario. Although the company is focused on its base metal properties, an exploration program for these claims will be planned for mid 2008.