Category: Silver / Gold

Silver Bear Announces Additional High Grade Results from 2008 Drill Program at Mangazeisky, Third Quarter Financial Results

- A total of 80 holes (12,930 metres) have been completed as of October 31, 2008, with assay results returned for 52 holes.

Highlights from the 32 most recent - Hole V08-063 returned 1,639 grams per tonne of silver over a 5.6 metre interval;
- Hole V08-037A returned 824 grams per tonne of silver over a 4.8 metre interval;
- Hole V08-066 returned 667 grams per tonne silver over a 8.8 metre interval;
- Hole V08-047 returned 640 grams per tonne silver over a 4.3 metre interval;
- Hole V08-062 returned 502 grams per tonne silver over a 3.9 metre interval

Silver Bear Resources Inc. ("Silver Bear" or the "Company") (TSX:SBR) today announced further positive results from exploration drilling at its 100% owned Mangazeisky silver project, its strong liquidity position and financial results for the three and nine-month period ended September 30, 2008. All dollar amounts are in Canadian dollars unless otherwise stated.

 

"We are very pleased to announce continued high-grade exploration results at Mangazeisky that further support the vast potential of the project. Silver Bear remains well financed and we will continue to explore Mangazeisky in 2009," said Mr. Randall Oliphant, President and Chief Executive Officer.

In addition to the positive drill results during the quarter, the arbitration case with the Federal Tax Service, discussed in the Company's second quarter results, concluded on September 14th with the court's August 12, 2008 decision, in favour of Silver Bear, being upheld as the Federal Tax Service did not file an appeal by the requisite due date. The Company has received confirmation from the court that this matter has been dismissed.


    <<
    Outlook - Mangazeisky Project
    -----------------------------

    Key milestones for Silver Bear:

     -  Exploration will continue on the known extensions of the Vertikalny
        vein to demonstrate a potential of 200 to 250 million ounces of
        silver(1).

     -  Results of the Company's exploration program will be summarized in an
        NI 43-101 Technical Report due in Q1 2009.

     -  Complete 10,000 metres of exploration drilling during the 2009 field
        season compared to previous plan of 40,000 metres.
    >>

Silver Bear will continue to explore the Mangazeisky property in 2009. Silver Bear has a strong cash balance of $28.7 million at September 30, 2008, and as a result of current uncertainty in the capital markets has decided to reduce the exploration program planned for 2009 to conserve cash which will allow the Company to continue exploration activities into 2010. The Company has scaled back its drill program to 10,000 metres from 40,000 metres. The Company remains committed to further advancing the project through targeted exploration within the Mangazeisky claim block. Further, the Company is in the process of applying for an extension of its license for an additional five years.


    <<
    -------------------------------
    (1) The reader is cautioned that the targets expressed above and
        elsewhere in this press release are based on Silver Bear's assessment
        of the geological data currently available and are conceptual in
        nature. There has been insufficient exploration with respect to these
        targets to define any estimates of quantities. There is no guarantee
        that the targeted estimates will be delineated through additional
        exploration. These are objectives set by the Company and they are not
        estimates of quantities as contemplated by section 2.3 of NI 43-101.
        There is no assurance that these objectives will materialize.


    THIRD QUARTER FINANCIAL RESULTS
    -------------------------------

    Liquidity and Capital Resources
    -------------------------------
    >>

At the start of 2008, Silver Bear had cash and cash equivalents of $30.3 million. On January 18, 2008, the Company raised net proceeds of $1.6 million in relation to the over-allotment option granted by the Company to underwriters in connection with the Company's initial public offering in December 2007. In May 2008, the Company sold its 70% interest in Mine Avlayakan LLC for proceeds of US$8.5 million. On July 16, 2008, the Company completed a private placement with Alfa Group Consortium for net proceeds of $4.2 million. As at September 30, 2008 the Company has invested $3.1 million in property, plant and equipment and had cash expenses of $12.5 million from continuing operations. As at September 30, 2008 cash and cash equivalents were $28.7 million.

Silver Bear is currently budgeting for 2009 with the objective to complete a program in 2009 of 10,000 metres of exploration drilling.

<< Financial Results ----------------- >>

Silver Bear incurred a net loss for the nine month period ended September 30, 2008 of $13.7 million or $0.37 per share, including a $2.5 million gain on the sale of the Avlayakan gold property. This compares to a loss of $10.1 million or $0.43 per share for the nine month period ended September 30, 2007. Exploration costs were $11.9 million in the nine month period ended September 30, 2008 compared with $4.5 million in the nine month period ended September 30, 2007. The Mangazeisky Project accounted for all of the $11.9 million in costs, which primarily related to the 2008 exploration program and costs related to the Company's Yakutsk administrative offices. Exploration expenses increased when compared to the 2007 period since 12,930 meters of diamond drilling was competed in the period ended September 30, 2008 versus 7,199 metres in the period ended September 30, 2007. Rising fuel prices and increased staffing have also contributed to the cost increases. Non-cash stock option compensation expense for the nine month period ended September 30, 2008 was $1.0 million compared with $1.2 million in the nine month period ended September 30, 2007. General and administrative expenses for the nine month period ended September 30, 2008 were $3.2 million compared with $1.7 million in the prior nine month period. The increased general and administrative costs are primarily related to legal fees associated with our Russian litigation, increased investor relations activities and other costs associated with increased staffing in the corporate office.

Silver Bear incurred a net loss for the three month period ended September 30, 2008 of $8.3 million or $0.22 per share. This compares to a loss of $3.7 million or $0.15 per share for the three month period ended September 30, 2007. Exploration costs were $7.2 million in the three month period ended September 30, 2008 compared with $2.1 million in the three month period ended September 30, 2007. The Mangazeisky Project accounted for all of the $7.2 million in costs, which primarily related to the 2008 exploration program and costs related to the Company's Yakutsk administrative offices. The increase in the exploration expenses for the three month period ended September 30, 2008 was a result of increased drilling activity in 2008 versus 2007. Non-cash stock option compensation expense for the three month period ended September 30, 2008 was $0.3 million compared with $0.3 million in the three month period ended September 30, 2007. General and administrative expenses for the three month period ended September 30, 2008 were $0.6 million compared with $0.6 million in the prior three month period.

<< Exploration Update ------------------ >>

Since the September 8, 2008 news release, results have been returned for an additional 32 holes.

Results have been returned for 52 holes to date, representing approximately 65% of the total drilled. Significant results from the 32 most recently assayed holes include:

Hole V08-063 (Profile 10250) returned 1,639 grams per tonne of silver over a 5.6 metre interval, approximately 50 metres below hole V08-040 which returned 1,552 grams per tonne silver over a 4.3 metre interval;

Hole V08-037A (Profile 10650) returned 824 grams per tonne silver over a 4.8 metre interval; approximately 50 metres below hole V08-036 which returned 457 grams per tonne silver over a 0.7 metre interval;

Hole V08-066 (Profile 10550) returned 667 grams per tonne silver over a 8.8 metre interval, approximately 50 metres between hole V07-003 which returned 119 grams of silver per tonne over a 6.8 metre interval and hole V08-032 which returned 362 grams per tonne silver over an 11.4 metre interval;

Hole V08-047 (Profile 10000) returned 640 grams per tonne silver over a 4.3 metre interval, approximately 50 metres below hole V07-002 which returned 30 grams per tonne silver over a 6.1 metre interval;

Hole V08-062 (Profile 9700) returned 502 grams per tonne silver over a 3.9 metre interval, approximately 100 metres below hole V07-013 which returned 596 grams per tonne silver over a 4.4 metre interval;

Hole V08-064 (Profile 10550) returned 342 grams per tonne silver over a 6.3 metre interval, approximately 50 metres between hole V08-029 which returned 998 grams per tonne silver over a 4.7 metre interval and hole V08-031 which returned 1,739 grams of silver per tonne over a 2.8 metre interval;

Holes V08-064 and V08-066 confirm the previously interpreted presence of a high grade lens measuring approximately 200 metres along strike and 200 metres down dip which averages 743 grams per tonne silver over an average horizontal thickness of 2.7 metres. This zone is structurally offset to the northwest where surface mapping has successfully identified the extension of the Vertikalny zone.

Trenching operations commenced once the diamond drilling program was completed. Surface trenching at Mangazeisky is more effective in the fall and winter months as the trenches fill with groundwater generated from melting permafrost during the summer. A total of 18,389 cubic metres of trenching had been completed as of October 20, 2008. Silver Bear has met the 2008 trenching requirement of its license agreement.

An induced polarity / magnetotelluric resistivity geophysical survey was also completed at Vertikalny. The 16 kilometre survey, completed by Quantec Geoscience, evaluated the geophysical response along the Vertikalny structure over a 2.4 kilometre strike length. Results are currently being evaluated by Quantec Geoscience and an interpretation of the geophysical response will be provided during the fourth quarter of 2008.

Regionally, exploration crews completed 66.8 kilometres of mapping and geochemical sampling at targets within the Mangazeisky License area. Reconnaissance field work focused on tracing the Vertikalny structure to the north west as well as preliminary work to evaluate the Zabytiy target (approximately 5 kilometres north of Vertikalny) and the Kis-Kuelskiy target (25 kilometres southeast of Vertikalny). Both targets are similar in nature to Vertikalny and both returned significant results indicative of favourable mineralization. Exploration in 2009 will focus on establishing surface trenches at both target areas and expanding the geochemical surface sampling.

Refer to our website, www.silverbearresources.com, for a longitudinal section of the drill results.


    <<
    The following table outlines the results received since our previous
September 8, 2008 release.

    -------------------------------------------------------------------------
    Hole ID      Profile         From           To    Length (m) Silver (g/t)
    -------------------------------------------------------------------------
    V08-021A        10200       194.8        196.1          1.3           32
    -------------------------------------------------------------------------
    V08-037A        10650       206.5        211.3          4.8          824
    -------------------------------------------------------------------------
    V08-038                                                      Not Sampled
    -------------------------------------------------------------------------
    V08-041A         9900       148.5        153.8          5.3          212
    -------------------------------------------------------------------------
    V08-042         10250        51.9         54.0          2.1           75
    -------------------------------------------------------------------------
    V08-044         10100                                                NSR
    -------------------------------------------------------------------------
    V08-045         10650        88.0         89.0          1.0           21
    -------------------------------------------------------------------------
    V08-046         10000        37.2         40.7          3.5          102
    -------------------------------------------------------------------------
    V08-047         10000       131.1        135.4          4.3          640
    -------------------------------------------------------------------------
    V08-048         10700        27.5         28.2          0.7           37
    -------------------------------------------------------------------------
    V08-049          9900       205.3        209.0          3.7           68
    -------------------------------------------------------------------------
    V08-050         10700                                                NSR
    -------------------------------------------------------------------------
    V08-051          9900       110.2        116.5          6.3          360
    -------------------------------------------------------------------------
    V08-052          9850        94.6         96.4          1.8          190
    -------------------------------------------------------------------------
    V08-053          9850       144.0        154.2         10.2           38
    -------------------------------------------------------------------------
    V08-054         10700       129.0        130.7          1.7           11
    -------------------------------------------------------------------------
    V08-054A        10700       132.6        133.7          1.1           19
    -------------------------------------------------------------------------
    V08-055          9850       197.0        200.2          3.2           47
    -------------------------------------------------------------------------
    V08-056          9850       232.0        236.2          4.2          126
    -------------------------------------------------------------------------
    V08-057          9800       121.3        122.0          0.7          164
    -------------------------------------------------------------------------
    V08-058         10500       212.0        217.0          5.0          213
    -------------------------------------------------------------------------
    V08-059          9800       161.5        167.8          6.3          356
    -------------------------------------------------------------------------
    V08-060         10500        78.9         86.4          7.5          556
    -------------------------------------------------------------------------
    V08-061         10250       123.3        124.3          1.0           12
    -------------------------------------------------------------------------
    V08-062          9700       141.1        145.0          3.9          502
    -------------------------------------------------------------------------
    V08-063         10250       183.3        188.9          5.6        1,639
    -------------------------------------------------------------------------
    V08-064         10550        15.5         21.8          6.3          342
    -------------------------------------------------------------------------
    V08-066         10550       110.0        118.8          8.8          667
    -------------------------------------------------------------------------
    V08-067         10150                                                NSR
    -------------------------------------------------------------------------
    V08-068         10150        86.6         88.0          1.4           23
    -------------------------------------------------------------------------
    V08-069          9600        20.2         21.0          0.8          318
    -------------------------------------------------------------------------
    V08-070          9550        53.5         57.5          4.0          243
    -------------------------------------------------------------------------
    NSR: No Significant Results
    >>

The results contained herein have been reviewed by Vivian Park, P.Geo., Silver Bear's Qualified Person managing the exploration program on the Mangazeisky Project. Vivian Park is an employee of Silver Bear in the capacity of Director of Exploration.

SAMPLE COLLECTION AND PREPARATION

Silver Bear's core sampling and preparation program is summarized as follows:

All core is 60.3 mm diameter. The core is placed in boxes at the drill site, complete with distance markers. On arrival at the core logging facility, the core boxes are opened and a geologist is responsible for organizing and photographing the core, completing a geotechnical log, and preparing the core for geological logging and sampling.

The core is logged for lithology, structure and mineralization. Intervals of interest are marked for sampling. Intervals deemed to be potentially anomalous in silver are cut using a diamond saw with one half of the core prepared as the sample and the other half retained in the core box and stored at site.

Samples are crushed to a nominal size of -1mm at an on-site preparation facility. A 500 gram split is shipped to the laboratory for pulverization and assay; a duplicate split is retained on site.

All fire assays for silver are completed at the Chemical Laboratory of the State Enterprise Aldangeologiya (Aldan Lab), located in Yakutia, Russia.

Silver Bear's quality control protocol includes the blind submission of certified standards (prepared by Geostats Pty Ltd of Australia), field blanks and field duplicates into the sample stream to monitor the accuracy and precision of the fire assay results.

Geological control samples comprise 15% of the total sample volume. It is standard practice that should the reported results exceed the permissible variance limits ascribed to said standards that the affected batches are re-analyzed. No such occurrences were noted in the results reported above.

An updated drill plan and longitudinal section demonstrating the hole locations is available on the Company's website at www.silverbearresources.com.

<< Silver Bear Resources Inc. -------------------------- >>

The primary business of the Company is the evaluation, acquisition, exploration and development of silver properties in the Russian Federation. The Company's principal asset is its 100% owned Mangazeisky Project, located approximately 400 kilometres north of Yakutsk in the Republic of Sakha, Yakutia in the Russian Federation.

Silver Bear Resources Inc. is listed on the Toronto Stock Exchange and its common shares trade under the symbol "SBR". Silver Bear has 37,935,569 issued and outstanding common shares. Other information relating to Silver Bear is available on SEDAR at www.sedar.com as well as on the Company's web site at www.silverbearresources.com.

Forward-Looking Information

This release and subsequent oral statements made by and on behalf of the Company may contain forward-looking statements, which reflect management's expectations with respect to the proposed transaction. Wherever possible, words such as "intends", "expects", "scheduled", "estimates", "anticipates", "believes" and similar expressions or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, have been used to identify these forward-looking statements. Although the forward-looking statements contained in this release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Silver Bear cannot be certain that actual results will be consistent with these forward-looking statements. A number of factors could cause events and achievements to differ materially from the results expressed or implied in the forward-looking statements. Such risks factors include but are not limited to risks factors identified by Silver Bear in its continuous disclosure filings filed from time to time on SEDAR. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Forward-looking statements necessarily involve significant known and unknown risks, assumptions and uncertainties that may cause Silver Bear's actual results, events, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although Silver Bear has attempted to identify important risks and factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors and risks that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date of this release, and Silver Bear assumes no obligation to update or revise them to reflect new events or circumstances, unless otherwise required by law.


    <<
    Silver Bear Resources Inc.
    (an exploration stage enterprise)
    Consolidated Balance Sheet
    (Canadian dollars)
    (unaudited)

                                                  September 30,  December 31,
                                                 -------------- -------------
                                                          2008          2007
    Assets                                                   $             $

    Current assets
    Cash and cash equivalents                       28,669,371    30,295,581
    Related party receivable                            19,268        31,052
    Non-controlling interest                                 -       151,592
    Inventories                                      1,553,628       628,196
    Prepaid expenses                                 1,221,764     2,305,284
    Miscellaneous receivables                           36,913        50,232
                                                 -------------- -------------
                                                    31,500,944    33,461,937

    Capital assets
    Mineral properties                               1,280,751       959,670
    Property, plant and equipment                    3,197,129       874,147
    Asset held for sale                                      -     5,885,218
                                                 -------------- -------------
                                                    35,978,824    41,180,972
                                                 -------------- -------------
                                                 -------------- -------------

    Liabilities

    Current liabilities
    Accounts payable and accrued liabilities
     from continuing operations                      2,654,518     1,127,478
    Accounts payable and accrued liabilities
     from discontinued operations                            -       200,265
                                                 -------------- -------------
                                                     2,654,518     1,327,743
                                                 -------------- -------------

    Long-term liabilities
    Asset retirement obligation                        577,814       245,360
    Non-controlling interest                                 -           127

    Shareholders' equity

    Capital Stock                                   73,771,289    67,991,311

    Warrants                                                 -       273,575

    Contributed surplus                              8,130,419     6,835,085

    Deficit                                        (49,155,216)  (35,492,229)
                                                 -------------- -------------
                                                    32,746,492    39,607,742
                                                 -------------- -------------

                                                 -------------- -------------
                                                    35,978,824    41,180,972
                                                 -------------- -------------



    Silver Bear Resources Inc.
    (an exploration stage enterprise)
    Consolidated Statements of Operations and Comprehensive Loss and Deficit
    (Canadian dollars)
    (unaudited)

                              Three Months Ended           Nine Months Ended
                                    September 30,               September 30,
                        -------------------------  --------------------------
                              2008          2007          2008          2007
                                 $             $             $             $

    Income
      Interest income      137,914        56,946       603,308       152,268
                      ------------- ------------- ------------- -------------
    Expenses
      Exploration costs  7,206,937     2,126,903    11,851,297     4,507,861
      Stock option
       compensation        292,302       262,406     1,021,759     1,202,077
      Amortization         195,111       243,087       732,502       712,923
      General and
       administrative      603,169       555,298     3,230,726     1,676,744
      Penalty shares             -             -             -       647,233
      Foreign exchange
       loss (gain)         151,493        34,979       (46,159)      164,482
      Accretion expense      3,794             -        11,376             -
      Gain on disposal
       of property,
       plant and
       equipment                 -       (11,035)            -       (11,035)

                      ------------- ------------- ------------- -------------
    Expenses from con-
     tinued operations   8,452,806     3,211,638    16,801,500     8,900,285
                      ------------- ------------- ------------- -------------
    Non-controlling
     interest                    -      (409,441)      (33,179)     (665,686)

    Loss and Comp-
     rehensive Loss for
     the period from con-
     tinued operations  (8,314,892)    (2,745,251)  (16,165,014)  (8,082,331)

    Discontinued
     operations                  -       (987,512)    2,502,027   (2,029,231)

                      ------------- ------------- ------------- -------------
    Net Loss and comp-
     rehensive loss     (8,314,892)    (3,732,762)  (13,662,987) (10,111,561)
                      ------------- ------------- ------------- -------------

    Deficit - Beginning
     of the period     (40,840,324)   (29,010,033)  (35,492,229) (22,631,234)

                      ------------- ------------- ------------- -------------
    Deficit - End of
     the period        (49,155,216)   (32,742,795)  (49,155,216) (32,742,795)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

    Weighted average
     number of common
     shares outstanding 37,066,717     25,591,014    36,841,555   23,823,991

    Loss per share from
     continued
     operations        $     (0.22)   $     (0.11)  $     (0.44) $     (0.34)
    Loss per share from
     discontinued
     operations                  -          (0.04)         0.07        (0.09)
                      ------------- ------------- ------------- -------------
    Loss per share     $     (0.22)   $     (0.15)  $     (0.37) $     (0.43)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------



    Silver Bear Resources Inc.
    (an exploration stage enterprise)
    Consolidated Statements of Cash Flows
    (Canadian dollars)
    (unaudited)

                              Three Months Ended           Nine Months Ended
                                    September 30,               September 30,
                        -------------------------  --------------------------
                              2008          2007          2008          2007
                                 $             $             $             $

    Cash provided by
     (used in)

    Operating activities
    Loss from
     Continuing
     operations         (8,314,892)   (2,745,251)  (16,165,014)   (8,082,331)

    Items not affecting
     cash:
      Amortization         195,111       243,087       732,502       712,923
      Accretion expense      3,794             -        11,376             -
      Stock option
       compensation        292,303       262,406     1,021,759     1,202,077
      Penalty shares
       issued                    -             -             -       647,233
      Gain on sale of
       property, plant
       and equipment             -       (11,035)            -       (11,035)
      Net change in non-
       cash working
       capital             778,964       157,706     1,861,823       524,039

                      ------------- ------------- ------------- -------------
    Net cash from
     continuing
     operations         (7,044,721)   (2,093,087)  (12,537,554)   (5,007,094)
                      ------------- ------------- ------------- -------------

    Financing activities
    Issuance of common
     shares              4,434,420             -     5,779,977    17,279,568
    Non-controlling
     interest                    -             -          (127)          127

                      ------------- ------------- ------------- -------------
                         4,434,420             -     5,779,850    17,279,695
                      ------------- ------------- ------------- -------------

    Investing activities
    Acquisition of
     property, plant and
     equipment            (807,371)     (126,813)   (3,055,484)     (321,190)
    Proceeds of sale of
     property, plant and
     equipment                   -        21,894             -        21,894

                      ------------- ------------- ------------- -------------
                          (807,371)     (104,919)   (3,055,484)     (299,296)
                      ------------- ------------- ------------- -------------

    Increase (decrease)
     in cash and cash
     equivalents during
     the period         (3,417,672)   (2,198,006)   (9,813,188)   11,973,305

    Increase (decrease)
     in cash and cash
     equivalents during
     the period from
     discontinued
     operations                  -    (1,002,149)    8,186,979    (6,768,823)

    Cash and cash
     equivalents -
     beginning of the
     period             32,087,043    10,383,567    30,295,580     1,978,930

                      ------------- ------------- ------------- -------------
    Cash and cash
     equivalents - end
     of the period      28,669,371     7,183,412    28,669,371     7,183,412
                      ------------- ------------- ------------- -------------
    >>

SOURCE: Silver Bear Resources Inc.

please visit www.silverbearresources.com, or contact: Raymond Threlkeld, Chief
Operating Officer, (416) 324-6005, This email address is being protected from spambots. You need JavaScript enabled to view it.; Brian Penny,
Chief Financial Officer, (416) 324-6002, This email address is being protected from spambots. You need JavaScript enabled to view it.; Hannes
Portmann, Director, Corporate Development and Investor Relations, (416) 324-6014,
This email address is being protected from spambots. You need JavaScript enabled to view it.

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