Liberty Reports Second Quarter 2010 Financial Results

Liberty Mines Inc. ( LBE | PowerRating - TSX), ("Liberty or the Company") reports financial results for the second quarter ended June 30, 2010 ("Q2") from its mining operations at the Redstone and McWatters nickel mines near Timmins Ontario. All dollar amounts are expressed in Canadian dollars unless specified otherwise.

Second quarter highlights:

* Mining from the open pit at the McWatters nickel mine commenced June 7, 2010;

* Commissioning of the third ball mill at the Redstone nickel concentrator ("Mill") in late May 2010 allowed the Mill to operate at its permitted capacity of 1500 tonnes per day subsequent to the quarter in mid July 2010;

* During June, 32,125 tonnes of ore were processed at the Mill, being 56.8% of the 56,520 tonnes processed during Q2;

* Milling cost per tonne in June was $15.86;

* Average metallurgical recovery was 83.1%;

* Metal sold to Xstrata was 699,554 pounds of nickel, 43,342 lbs of copper, and 8,601 lbs of cobalt subject to final settlement;

* Cost to produce a pound of nickel in June was US$5.17*;

* Cash operating profit from mining operations was $708,516 before non-cash charges.

Mine production statistics during Q2:

---------------------------------------------------------------------

Mine                      Tonnes      Grade Ni %    Mining Cost/Tonne

---------------------------------------------------------------------

Redstone                  19,588         0.88             $63.35          

---------------------------------------------------------------------

McWatters Underground     37,833         0.78             $45.33          

---------------------------------------------------------------------

McWatters Open Pit        32,500         0.49              $3.87          

---------------------------------------------------------------------



Mill processing statistics during Q2:

---------------------------------------------------------------------

Mine              Wet Tonnes Milled   Grade Ni %   Dry Tonnes Milled

---------------------------------------------------------------------

Redstone                  13,077         0.88            12,899.5        

---------------------------------------------------------------------

McWatters Underground     40,936         0.78            40,489.3        

---------------------------------------------------------------------

McWatters Open Pit         2,507         0.49             2,481.7        

---------------------------------------------------------------------

Gary Nash, Liberty's President & CEO, commented: "We now have ample ore to operate our concentrator at its full permitted capacity. This is a milestone for the Company which enables us to run our mining and milling operations efficiently. We are on target to produce a pound of nickel near US$4.50* during the second half of 2010."

* This non-GAAP statistic includes mining, milling, transportation, smelting, refining, price participation and marketing costs but excludes mine depletion and operating asset amortization charges.

Outlook

As explained in more detail in the MD&A for the second quarter, the Redstone nickel concentrator may be restricted by existing permitting to process approximately 370,000 tonnes of ore in 2010 (previous guidance was 460,000 tonnes) unless the allowed processing rate of 1500 tonnes per day is amended before year end. The expected production of nickel in concentrate is now estimated to be 4,200,000 to 4,700,000 pounds for the year 2010 with approximately 209,000 pounds of copper and 88,000 pounds of cobalt.

Subsequent to the end of the quarter, the mining lease for the Hart nickel mine was registered and the Closure Plan will be submitted shortly. Construction of the mine is expected to commence immediately after the receipt of the filed Closure Plan from the Ministry of Northern Development of Mines and Forestry in early Q4 2010.

Financial Results

Revenue including final settlement adjustments was $14.9 million and $7.3 million for the three and six months ended June 30, 2010 compared to nil and nil for the same periods of 2009. Cash operating profit for the three and six months ended June 30, 2010 was $0.7 million and $1.8 compared to a cash operating loss of $1.7 and $2.2 during the same periods last year. Net losses for the three and six months ended June 30, 2010 were $5.0 and 7.4 million compared to $2.3 and $5.1 million for the same period of 2009.

Net working capital for the six months ended June 30, 2010 was a deficiency of $38.4 million compared to $30.6 million as at December 31, 2009.

Liberty had capital expenditures of $0.6 and $1.6 million during the three and six months ended June 30, 2010. The majority of the expenditures related to the additional equipment required to bring the McWatters mine into full production. Mine development expenditures of $1.6 and $3.3 million for the three and six months ended June 30, 2010 related to the continued development of the McWatters and Redstone mines. Expenditures related to the development of the McWatters open pit was $0.5 million and was completed during Q2.

Liberty Mines financial statements for the second quarter ended June 30, 2010 are available at www.libertymines.com and www.sedar.com. These financial statements should be read in conjunction with the notes and management's discussion and analysis available at the same websites.

About 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 propertiesin Ontario, Canada. It owns and operates the Redstone nickel concentrator near Timmins Ontario.

CAUTIONARY STATEMENT

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This News Release includes certain "forward looking statements". All statements other than statements of historical fact included in this release, without limitation, statements regarding future plans and objectives of Liberty, are forward looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Liberty's expectations are: exploration risks; commodity prices; regulatory approvals; receipt of mining permits and leases; equipment failures and shortage of supplies; and assumed startup and operating costs detailed herein and from time to time in the filings made by Liberty with securities regulators. Forward-looking statements speak only as of the date on which they are made. The Company undertakes no obligation to publicly update any such statement or reflect new information or the occurrence of future events or circumstances, except where required by securities regulations. Accordingly, readers should not place undue reliance on forward-looking statements.

For further information please contact:

Dr. Gary Nash, PhD (Physics), President & CEO

Phone (416) 238-9736 Fax 780-437-7898

e-mail: gnash@libertymines.com

Source: Liberty Mines Inc. (TSX: LBE) http:// www.libertymines.com

Maximum News Dissemination by Filing Services Canada Inc. *

www.usetdas.com

http://www.useTDAS.com

For full details on (LBEFF) LBEFF. (LBEFF) has Short Term PowerRatings at TradingMarkets. Details on (LBEFF) Short Term PowerRatings is available at This Link.

For full details on (LBE) LBE. (LBE) has Short Term PowerRatings at TradingMarkets. Details on (LBE) Short Term PowerRatings is available at This Link.