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News Release

Silver Dragon Discovers 0.8m Averaging 2,471 g/tonne, 0.8m Averaging 1,780 g/tonne and 0.4m of 999 g/tonne of Silver at its Laopandao Polymetallic Project in Northern China

BEIJING, June 1, 2009 (PRIME NEWSWIRE) – Silver Dragon Resources Inc. (OTCBB:SDRG) is pleased to announce further progress from recently completed tunneling and drilling work performed at the Company's Laopandao Silver-Tin-Copper-Lead Polymetallic project in Inner Mongolia, Northern China (see also press release of April 28, 2008).  Highlights of the latest discoveries are as follows:

  • A significant Tin (Sn) mineralized body (I-8) was identified by transverse drift NCM6 and underground drill holes ZK0605 and ZK0606;
  • The Sn mineralized body I-8 is 7.8 m (meters) thick with an average Sn grade of 0.985% and a high grade of 5.44% (revealed by transverse drift NCM6);
  • The highest grade silver samples were 0.8 m averaging 2,471 g/tonne, 0.8 m averaging 1,780 g/tonne, and 0.4 m of 999 g/tonne
  • Two underground drill holes revealed that the dipping extension of Sn mineralized body I-8 could reach more than 100m;
  • More drilling and tunneling projects are currently being carried out to find more industrial Tin resources at Laopandao in the 2009 exploration season.

The Laopandao exploration area has three known significant geochemical anomalies, No. 104, No. 102, and No. 95 (Fig. 1).  Since 2007, most drilling and tunneling projects have been concentrated in anomaly No. 95, where Silver-Tin-Copper-Lead (Ag-Sn-Cu-Pb) mineralized bodies have been discovered, some of which contain high silver and tin grades with high industrial values.  In 2008, the total investment in this property was RMB1.41 million (US~$200,000), which was mainly used to perform 501m of surface drilling (one hole), 405.5m of underground drilling (three holes), and 217 m of tunneling.  Major achievements are as follows:

  1. Under regional Ag-Sn-Cu-Pb hydrothermal ore-forming background, a significant tin mineralized body (I-8) has been found near the northern end of transverse drift NCM 6 (Fig. 2) and controlled by the transverse drift (NCM6) and two underground drill holes (ZK0605 and ZK0606) (Tables 1, 2 & 3; Figures 2 & 3).   Hosted in Mesozoic volcanic strata, the mineralized body I-8 is 7.8 m thick with an average Sn grade of 0.985% and a high Sn grade of 5.44% (industrial cutoff grade of tin being 0.1%) in transverse drift NCM6.  Two underground drill holes hit the dipping extension part of the Sn mineralized body I-8, indicating more than 100m dipping extension depth and about 10m width.  Drill hole ZK0605 hit Sn mineralized body I-8, which can be divided into a silver rich part (I-8a) and a tin rich part (I-8b).  The total width revealed is 10.8 m (two parts) and the average grades of tin are 0.34% and 0.19%, respectively.  Drill hole ZK0606 hit Sn mineralized body I-8 in the deeper positions, the width of which is 12.1m with an average Sn grade of 3.02%.  It is a very significant finding of a tin mineralized body in Laopandao.  A further drill hole (ZK0607) has been designed to control the tin mineralized body I-8 (Fig. 3).
  2. The transverse drift (NCM6) and one underground drill hole (ZK0604) have also revealed four smaller Ag-Cu-Pb mineralized bodies, which are located about 10 meters southwest of the Sn mineralized body within transverse drift NCM6.  The underground drilling results indicate that the smaller Ag-Cu-Pb mineralized bodies have certain dipping extensions (Tables 1 and 4, Fig. 3).
  3. A surface drill hole (ZK0603) (Fig. 3) has hit three Ag-Cu-Sn mineralized bodies: No. II-1(a) (5.1 m thick with average grades 65g/t Ag, 0.286% Cu, and 0.02% Sn), No. II-15 (1.4 m thick with average grades 31.45 g/t Ag, 0.59% Cu, and 0.019%Sn) and No. II-14 (1.4 m thick with average grades 63.12 g/t Ag, Cu 0.18%, and 0.02%Sn) (Table 5).
  4. Based on the discovery of the Sn mineralized body (I-8) in transverse drift NMC6, Silver Dragon will focus more on exploring the tin resource potential at Laopandao. 

Currently, Silver Dragon’s Chinese subsidiary is commencing a comprehensive exploration program comprising 3,000 m of drilling and 300 m of tunneling to probe the extensions of Laonpandao’s tin and silver mineralized bodies both in tunnels and on the surface.

Table 1   Assay results of northern segment of transverse drift No. 6

Sample number Sampling position Assay results Mineralized body number:
Average grade(Ag10-6, Cu10-2,Sn10-2
width of mineralized body(m)
From (m)

To
(m)

Sample length (m) Ag(10-6

Cu(10-2

Sn(10-2

Bi(10-2)

Lp1003 166.6 167.3 0.70 40.0 1.44 0.027 I-2 Ag16.51,Cu0.697 ,Sn0.027 2.10
Lp1004 167.3 168.1 0.80 12.5 0.39 0.024
Lp1005 168.1 168.7 0.6 7.5 0.24 0.031
Lp1008 184.0 184.8 0.8 2471 4.45 0.058 I-3 Ag641.89,Cu1.16 ,Sn0.092 3.20
Lp1009 184.8 185.3 0.5 108 0.20 0.15
Lp1010 185.3 186.3 1.0 7.5 0.017 0.065
Lp1011 186.3 187.2 0.9 17.5 0.042 0.12
Lp1015 203.8 204.6 0.8 29.2 0.18 0.17 I-5 Ag304.16,Cu0.89 ,Sn0.041 6.80
Lp1016 204.6 205.3 0.7 72.5 0.46 0.022
Lp1017 205.3 206.3 1.0 16.2 0.18 0.021
Lp1018 206.3 207.3 1.0 144 0.84 0.023
Lp1019 207.3 208.3 1.0 30.0 0.11 0.028
Lp1020 208.3 209.3 1.0 67.5 0.26 0.022
Lp1021 209.3 210.1 0.8 1780 4.42 0.024
Lp1022 210.1 210.6 0.5 625 1.28 0.022
Lp1029 233.1 233.7 0.6 78.0 0.29 0.028 I-6 Ag78.0,Cu0.29 ,Sn0.028 0.6
Lp1035 236.4 236.9 0.5 101 0.35 0.011 I-7 Ag305.38,Cu0.92 ,Sn0.015 1.60
Lp1036 236.9 237.6 0.7 55.0 0.40 0.013
Lp1037 237.6 238.0 0.4 999 2.54 0.022
Lp1040 247.0 247.5 0.5 5.0 0.24 1.50 I-8 Ag8.68,Cu0.14 ,Sn0.985 7.80
Lp1041 247.5 248.1 0.6 1.2 0.025 0.86
Lp1042 248.1 248.6 0.5 1.2 0.029 0.098
Lp1043 248.6 249.2 0.6 5.0 0.10 0.18
Lp1044 249.2 249.8 0.6 5.0 0.23 0.17
Lp1045 249.8 250.5 0.7 8.0 0.29 0.35
Lp1046 250.5 251.1 0.6 1.2 0.002 0.048
Lp1047 251.1 251.7 0.6 1.2 0.006 0.021
Lp1048 251.7 252.2 0.5 5.0 0.28 0.054
Lp1049 252.2 252.8 0.6 75.0 0.47 0.58
Lp1050 252.8 253.5 0.7 1.2 0.071 1.90
Lp1051 253.5 254.2 0.7 2.5 0.052 5.44
Lp1052 254.2 254.8 0.6 1.2 0.047 0.60

Note: All assay data were made by ordinary chemical methods at Yanjiao Central Laboratory of North China Nonferrous Geological Survey Bureau.

Table 2 Assay results of drill hole ZK0605 (underground drilling)

Sample number Sampling position Assay results Mineralized body number:
Average grade (Ag10-6 ,Cu10-2 ,Sn10-2) width of mineralized body(m)
From (m) To (m) Interval length (m) Sample length (m) Drilling core recovery ratio (%) Ag (10-6) Cu, (10-2) Sn (10-2) Bi (10-2)
Lp1304 53.50 54.30 0.80 0.43 54 72.8 0.22 1.06 0.009 I-8 (a): Ag42.38 ,Cu0.21 ,Sn0.304 3.5
Lp1305 54.30 55.20 0.90 0.49 54 93.6 0.58 0.11 0.002
Lp1306 55.20 56.10 0.90 0.49 54 4.50 0.019 0.020 <0.001
Lp1307 56.10 57.00 0.90 0.49 54 2.00 0.010 0.11 <0.001
Lp1311 60.00 60.80 0.80 0.43 54 1.20 0.005 0.40 0.001 I-8 (b): Ag2.10 ,Cu0.016 ,Sn0.19 7.2
Lp1312 60.80 61.60 0.80 0.43 54 1.20 0.003 0.084 0.002
Lp1312 61.60 62.40 0.80 0.43 54 1.20 0.002 0.051 0.006
Lp1314 62.40 63.20 0.80 0.43 54 1.20 0.003 0.74 0.006
Lp1315 63.20 64.00 0.80 0.43 54 1.20 0.005 0.12 0.001
Lp1316 64.00 64.80 0.80 0.43 54 5.90 0.099 0.02 0.004
Lp1317 64.80 65.60 0.80 0.43 54 2.00 0.009 0.011 0.005
Lp1318 65.60 66.40 0.80 0.43 54 2.80 0.002 0.12 0.011
Lp1319 66.40 67.20 0.80 0.43 54 2.20 0.012 0.17 0.011
Lp1340 95.50 96.50 1.00 0.72 72 1.20 0.024 0.29 I-5: Ag2.82 ,Cu0.04 ,Sn0.272 5.0
Lp1341 96.50 97.50 1.00 0.72 72 9.30 0.14 0.57
Lp1342 97.50 98.50 1.00 0.72 72 1.20 0.008 0.12
Lp1343 98.50 99.50 1.00 0.72 72 1.20 0.004 0.13
Lp1344 99.50 100.50 1.00 0.72 72 1.20 0.024 0.25
Lp1360 138.20 139.10 0.90 0.55 61 15.20 0.33 0.013 I-3: Ag75.60 ,Cu0.365,Sn0.014 1.8
Lp1361 139.10 140.00 0.90 0.55 61 136.00 0.40 0.015

Note: All assay data were made by ordinary chemical methods at Yanjiao Central Laboratory of North China Nonferrous Geological Survey Bureau

Table 3   Assay results of drill hole ZK0606 (underground drilling)

Sample number Sampling position Assay results Mineralized body number:
Average grade (Ag10-6 ,Cu10-2 ,Sn10-2) width of mineralized body(m)
From (m) To (m) Interval length (m) Sample length (m) Drilling core recovery ratio (%) Ag (10-6) Cu, (10-2) Sn (10-2) Bi (10-2)
Lp1372 41.60 42.50 0.90 0.61 68 1.80 0.049 0.24 I-11 : Ag1.80,Cu0.049 ,Sn0.24 0.90
Lp1376 52.50 53.50 1.00 0.53 53 12.40 0.13 0.21 I-12: Ag5.70,Cu0.068 ,Sn0.46 3.00
Lp1377 53.50 54.50 1.00 0.53 53 2.50 0.031 0.44
Lp1378 54.50 55.50 1.00 0.53 53 2.20 0.044 0.73
Lp1385 82.60 83.60 1.00 0.74 74 37.80 0.14 1.27 I-8: Ag39.66,Cu0.183 ,Sn3.02 12.10
Lp1386 83.60 84.60 1.00 0.59 59 72.8 0.26 4.36
Lp1387 84.60 85.60 1.00 0.59 59 10.20 0.042 1.92
Lp1388 85.60 86.60 1.00 0.59 59 17.80 0.070 1.22
Lp1389 86.60 87.60 1.00 0.59 59 21.80 0.080 0.66
Lp1390 87.60 88.60 1.00 0.59 59 27.00 0.16 5.96
Lp1391 88.60 89.60 1.00 0.59 59 5.00 0.046 3.30
Lp1392 89.60 90.60 1.00 0.59 59 3.50 0.031 6.42
Lp1393 90.60 91.60 1.00 0.59 59 4.40 0.038 10.04
Lp1394 91.60 92.60 1.00 0.64 64 1.20 0.002 0.12
Lp1395 93.70 94.40 0.70 0.45 64 1.20 0.009 0.33
Lp1396 94.40 95.10 0.70 0.48 68 72.5 0.39 0.48
Lp1397 95.10 95.80 0.70 0.48 68 324 1.52 1.02
Lp1409 119.00 120.00 1.00 0.77 77 1.20 0.002 0.46 I-13: Ag1.20,Cu0.002 ,Sn0.46 1.00

Note: All assay data were made by ordinary chemical methods at Yanjiao Central Laboratory of North China Nonferrous Geological Survey Bureau.

Table 4 Assay results of drill hole ZK0604 (underground drilling)


Sample number

Sampling position

Assay results

Mineralized body number:


Average grade(Ag10-6 ,Cu10-2 ,Sn10-2)

width of mineralized body(m)

From (m)

To
(m)

Interval length (m)

Sample length
(m)

Drilling core recovery ratio
(%)

Ag
(10-6)

Cu,
(10-2)

Sn
(10-2)

Bi
(10-2)

Sample number Sampling position Assay results Mineralized body number: Average grade(Ag10-6 ,Cu10-2 ,Sn10-2) width of mineralized body(m)
From (m) To (m) Interval length (m) Sample length (m) Drilling core recovery ratio (%) Ag (10-6) Cu (10-2) Sn (10-2) Bi (10-2)
Lp1121 168.69 169.49 0.80 0.80 100 268 0.90 0.020 I-1(a): Ag65.00 ,Cu0.286 ,Sn0.02 5.1
Lp1122 169.49 169.99 0.50 0.50 100 2.8 0.004 0.010
Lp1123 169.99 170.69 0.70 0.70 100 1.2 0.003 0.014
Lp1124 170.69 171.39 0.70 0.70 100 5.8 0.016 0.020
Lp1125 171.39 171.89 0.50 0.50 100 58.8 0.53 0.027
Lp1126 171.89 172.59 0.70 0.70 100 2.5 0.056 0.028
Lp1127 172.59 173.19 0.60 0.60 100 113 0.42 0.018
Lp1128 173.19 173.79 0.60 0.60 100 19.8 0.28 0.025
Lp1148 211.60 212.30 0.70 0.70 100 10.0 0.50 0.017 I-15: Ag31.45 ,Cu0.59 ,Sn0.019 1.4
Lp1149 212.30 213.00 0.70 0.70 100 52.9 0.68 0.020
Lp1160 226.40 227.10 0.70 0.70 100 8.4 0.30 0.022 I-14: Ag63.12 ,Cu0.18 ,Sn0.021 1.5
Lp1161 227.10 227.90 0.80 0.80 100 111 0.071 0.020

Note: All assay data were made by ordinary chemical methods at Yanjiao Central Laboratory of North China Nonferrous Geological Survey Bureau.

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.

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About Laopandao

Laopandao is one of the eight exploration properties of Sanhe Sino-Top Resources and Technologies Ltd. ("Sino-Top"), a Chinese company which holds exclusive exploration rights to these properties located in the prolific Erbahuo Silver District in Inner Mongolia, China. Silver Dragon has a 40% ownership interest in Sino-Top. The Laopandao exploration area covers 44.79 square kilometers and is located approximately 650 kilometers north by northeast of Beijing in Chifeng, Inner Mongolia. Mineralization zones have been identified in the northern, central, and southern portions of the exploration area. The most significant resent discovery was the existence of Ag-Sn-Cu-Pb 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.

About Sino-Top:

Sanhe Sino-Top Resources & Technologies, Ltd. (``Sino-Top'') was originally incorporated in 2003 as a Chinese company wholly owned by Huaguan Industrial Corp. (``HIC''), a subsidiary of state-owned entity North China Geological Exploration Bureau.  Sino-Top became an American-Chinese joint venture in 2005.  Silver Dragon Resources Inc. acquired Sino-Top in 2006, and currently owns 40% of Sino-Top after having sold 50% of its ownership interest to its Chinese partner for RMB30 million (approximately USD$4.5 million) as per the equity Transfer Agreement with HIC.  The Chinese side, led by Shengda and HIC, collectively owns 60%. Sino-Top holds exclusive exploration rights to eight properties and mining rights to one property (the Erbahuo Silver Mine) in northern China (Inner Mongolia), covering a total area of 261.25 km2.

Under the same agreement, Erbahuo Silver Mine will be spun off from Sino-Top and put under a separate entity, i.e. Chifeng Silver Dragon Resources & Technologies, Ltd. (“Chifeng Silver”), an American-Chinese joint venture that will be 70% owned by Silver Dragon upon completion of the relevant government approval process.

About Silver Dragon Resources Inc.:

Silver Dragon Resources Inc. is a mining and metal 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 the Cerro las Minitas and Erbahuo projects in Mexico and China respectively. For more information, please visit the Company's website at: www.silverdragonresources.com (now available in Chinese).

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 Laopandao Silver Project, production timelines, 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 mineralized 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.  

About Laopandao

Laopandao is one of the eight exploration properties of Sanhe Sino-Top Resources and Technologies Ltd. ("Sino-Top"), a Chinese company which holds exclusive exploration rights to these properties located in the prolific Erbahuo Silver District in Inner Mongolia, China. Silver Dragon has a 40% ownership interest in Sino-Top. The Laopandao exploration area covers 44.79 square kilometers and is located approximately 650 kilometers north by northeast of Beijing in Chifeng, Inner Mongolia. Mineralization zones have been identified in the northern, central, and southern portions of the exploration area. The most significant resent discovery was the existence of Ag-Sn-Cu-Pb 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.

About Sino-Top:

Sanhe Sino-Top Resources & Technologies, Ltd. (``Sino-Top'') was originally incorporated in 2003 as a Chinese company wholly owned by Huaguan Industrial Corp. (``HIC''), a subsidiary of state-owned entity North China Geological Exploration Bureau.  Sino-Top became an American-Chinese joint venture in 2005.  Silver Dragon Resources Inc. acquired Sino-Top in 2006, and currently owns 40% of Sino-Top after having sold 50% of its ownership interest to its Chinese partner for RMB30 million (approximately USD$4.5 million) as per the equity Transfer Agreement with HIC.  The Chinese side, led by Shengda and HIC, collectively owns 60%. Sino-Top holds exclusive exploration rights to eight properties and mining rights to one property (the Erbahuo Silver Mine) in northern China (Inner Mongolia), covering a total area of 261.25 km2.

Under the same agreement, Erbahuo Silver Mine will be spun off from Sino-Top and put under a separate entity, i.e. Chifeng Silver Dragon Resources & Technologies, Ltd. (“Chifeng Silver”), an American-Chinese joint venture that will be 70% owned by Silver Dragon upon completion of the relevant government approval process.

About Silver Dragon Resources Inc.:

Silver Dragon Resources Inc. is a mining and metal 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 the Cerro las Minitas and Erbahuo projects in Mexico and China respectively. For more information, please visit the Company's website at: www.silverdragonresources.com (now available in Chinese).

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 Laopandao Silver Project, production timelines, 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 mineralized 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.  

Contact Silver Dragon Resources Inc.

Marc Hazout
President
(416) 223-8500 or Toll Free: 1-866-512- SDRG (7374)
Email: info@silverdragonresources.com

Alessandro Motta
Investor Relations
(416) 223-8500 or Toll Free: 1-866-512- SDRG (7374)
Email: info@silverdragonresources.com

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