Magellan announces $20 Million BROKERED private placement

Vancouver, BC, December 11, 2009 ? Magellan Minerals Ltd. (TSX-V: MNM) (?Magellan? or the ?Company?) is pleased to announce that it has negotiated the terms of a brokered private placement of up to $20 million with Toll Cross Securities Inc. and Dundee Securities Corporation as co-lead agents, together with Haywood Securities Inc. (collectively the ?Agents?).  The offering (?Offering?) will consist of up to 17.14 million units of the Company (?Units?) and 11.43 million subscription receipts (?Subscription Receipts?).  The Units and Subscription Receipts will be issued at a price of $0.70, for gross proceeds of approximately $20 million to the Company.  Each Unit will consist of one common share and one-half of one share purchase warrant (each whole warrant referred to as a ?Warrant?) of the Company.  Each Warrant will entitle the holder to acquire one common share in the capital of Magellan, at a price of $1.00 for a period of 24 months following closing, In the event that the closing price of the Common Shares on the TSX Venture Exchange is in excess of $1.50 for a period of 30 consecutive trading days at any time after the closing of the offering, Magellan may, at its option, accelerate the expiry date of the Warrants by giving notice to the holders thereof and in such case the Warrants will expire at 4:00 p.m. (Toronto time) on the date which is the earlier of: (i) the 30^th day after the date on which such notice is given by Magellan and (ii) the 24 month anniversary of the closing of the Offering.  Magellan has also granted the Agents an over-allotment option to purchase in whole or in part up to an additional $2,995,000 of Units and Subscription Receipts (the ?Over-Allotment Option?).

The proceeds from the sale of the Units will be released to the Company on closing of the Offering.  Each Subscription Receipt will be automatically converted into one Unit on the closing by the Company of its acquisition of the Creporizinho gold mine located in Brazil (the ?Acquisition Closing?).   The terms of the Creporizinho gold mine acquisition were described in Magellan?s news release dated November 18, 2009.  The proceeds from the sale of the Subscription Receipts will be placed in escrow and released to the Company if the Acquisition Closing takes place on or before the 90^th day following the closing of the Offering.  If the Acquisition Closing does not take place on or before the 90^th day following the closing of the Offering, then the proceeds from the sale of the Subscription Receipts will be returned to the subscribers. 

Every subscriber under the Offering will be required to take a pro rata portion of Units and Subscription Receipts, meaning that 60% of each subscriber's subscription will be for Units and 40% will be for Subscription Receipts.

The Company has agreed to pay the Agents a 6% cash commission and issue 6% broker warrants.  Each broker warrant will entitle the holder to acquire one Unit of the Company at a price of $0.70 per Unit for a period of 24 months from the closing of the Offering.

The closing is expected to occur on December 22nd, 2009, or such earlier or later date as the Agents and the Company may determine.

The proceeds from the sale of the Units will be used to fund exploration and general working capital of the Company.  The proceeds from the sale of the Subscription Receipts will be used to acquire the Creporizinho gold mine.

The transactions contemplated hereby are subject to TSX Venture Exchange acceptance.

?This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the ?U.S. Securities Act?) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.?

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

For further information, please contact:

Alan Carter

President and CEO

Tel:       604.676.5663    

Email:   info@magellanminerals.com