Elgin Mining Inc. ("Elgin Mining" or the "Company") (TSX:ELG) is pleased to
provide the following update on the previously announced transaction with
Mandalay Resources Corporation ("Mandalay") (TSX:MND). Elgin Mining has now
reached a resolution on all outstanding reclamation obligations relating to its
former coal operations in Kentucky, and these are to Mandalay's satisfaction.
Elgin Mining has filed amended and restated interim financial statements and
management's discussion and analysis for the three months ended March 31, 2014
to reflect this settlement. The parties have also entered into an amended and
restated arrangement agreement ("Amended and Restated Arrangement Agreement")
dated July 25, 2014 with respect to the previously announced acquisition by
Mandalay of all the outstanding common shares of Elgin Mining for consideration
consisting of C$0.37 cash or 0.4111 of a Mandalay common share per Elgin Mining
common share, subject to pro ration, by way of plan of arrangement (the
"Arrangement").


The Amended and Restated Arrangement Agreement increases the amount of cash
consideration available to C$27 million (from C$25 million as previously
disclosed) in order to accommodate any exercise of Elgin Mining's outstanding
share purchase warrants ("Warrants") as a result of Elgin Mining's acceleration
of the expiry date of its Warrants to August 26, 2014. As a result of such
acceleration, no Warrants will be outstanding after the close of business on
August 26, 2014.


Q2-2014 Gold Production

The Bjorkdal mine had an excellent second quarter of production of 12,098 ounces
of gold. Production was from the processing of a mix of open pit and underground
ores. Gold production for Q3-2014 also started strongly in July, which is
normally a low month for gold and ore production due to the vacation period in
Sweden reducing the availability of both Company miners and mine contractors.


Shareholders' Meeting

Elgin's shareholders' meeting (the "Meeting") to approve the Arrangement is
scheduled to occur on Wednesday, September 3, 2014 at 8:00 am EDT at the offices
of Cassels Brock & Blackwell LLP, Scotia Plaza, 40 King Street West, Suite 2100,
Toronto, Ontario. Relevant Meeting materials providing further details of the
transaction are expected to be mailed on August 1, 2014. Assuming receipt of all
necessary court and shareholder approvals and the satisfaction of all other
conditions, closing is expected to occur on or about September 10, 2014.


Revised Interim Financial Reports for the Three Months ended March 31, 2014

The Company's previously filed interim financial statements for the three months
ended March 31, 2014 reflected a provision for reclamation and closure for its
former US coal operations in the amount of US$2,562,834. This reclamation
estimate was based on the amount of reclamation bonds posted by the Company and
held by the state of Kentucky as financial security for the performance of the
Company's required reclamation activities.


Since April 2014, the Company has been working with an experienced local
consultant and external counsel to reach a settlement whereby the Company would
achieve a full and final release of all remaining coal reclamation obligations.
The final amounts of the reclamation settlements with both the state of Kentucky
and the US Army Corps of Engineers, and including consultant fees, are expected
to total US$10,364,567. The Company has determined that the dollar amount of the
settlements reached with the respective US government agencies provide a better
estimate of the Company's reclamation liabilities that existed at March 31, 2014
than the amount previously provided for in the interim financial statements
which were filed on May 13, 2014.


As a result, the Company has amended and restated its interim financial
statements and management's discussion and analysis for the three months ended
March 31, 2014 to increase its coal reclamation liability to the expected costs
of the settlements of US$10,364,567, and to include disclosure of events
occurring subsequent to the date of the filings on May 13, 2014.


Elgin Mining Inc.

Elgin Mining is a Canadian based company focused on production at the Bjorkdal
gold mine in Sweden. In addition, Elgin Mining's portfolio includes the Lupin
and Ulu gold projects located in Nunavut, Canada.


For further information, please visit the Company's web site at www.elginmining.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of
securities legislation and which are based on the expectations, estimates and
projections of management of Elgin as of the date of this news release unless
otherwise stated. Forward-looking statements are generally identifiable by use
of the words "expect", "anticipate", "continue", "estimate", "objective",
"ongoing", "may", "will", "project", "should", "believe", "plans", "intends" or
the negative of these words or other variations on these words or comparable
terminology. More particularly, and without limitation, this news release
contains forward-looking statements and information concerning expectations
regarding the consideration to be issued pursuant to the transaction, the
ability of Elgin to consummate the transaction on the terms and in the manner
contemplated thereby and the expected timing of the closing of the Arrangement.
Such forward-looking statements involve known and unknown risks, uncertainties
and other factors which may cause actual results, performance or achievements to
be materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such factors include,
among others, the time required to prepare and mail meeting materials to Elgin
shareholders, the ability of the parties to receive, in a timely manner and on
satisfactory terms, the necessary court, shareholder, stock exchange and
regulatory approvals and the ability of the parties to satisfy, in a timely
manner, the conditions to the closing of the transaction, as well as other
uncertainties and risk factors set out in filings made from time to time by
Elgin with the Canadian securities regulators, including, without limitation,
Elgin's annual information form dated March 21, 2014, which is available on
SEDAR at www.sedar.com. Actual results, developments and timetables could vary
significantly from the estimates presented. Readers are cautioned not to put
undue reliance on forward-looking statements.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Elgin Mining Inc.
Patrick Downey
President and Chief Executive Officer
(604) 682-3366
(604) 682-3363 (FAX)
info@elginmining.com
www.elginmining.com