Mr. Alan Carter reports

MAGELLAN DRILLS 27M @ 6.94 G/T GOLD 600M SOUTH EAST OF CENTRAL AT CUIU CUIU PROJECT, BRAZIL

Magellan Minerals Ltd. has released the results of seven additional step-out and exploration holes at the Cuiu Cuiu project including 27 metres at 6.94 grams per tonne (g/t) gold located 600 metres southeast of the Central zone. Highlights include:

• 27 metres at 6.94 g/t gold in hole 138 located 600 metres southeast of the Central zone and 400 metres southeast of hole 121 (7.8 metres at 8.44 g/t gold), which represents another new zone of gold mineralization and has been named Central Southeast;
• 25 metres at 0.49 g/t gold in hole 137 at Jerimum Baixo which is located between Central and Moreira Gomes; gold mineralization at Jerimum Baixo traced consistently over an area of 350 metres by 35 metres and remains open in several directions;
• 19 metres at 0.48 g/t gold in hole 140 located close to the western margin of the Moreira Gomes zone.

Central Southeast

Hole 138 was drilled 600 metres southeast of the Central zone in the Central Southeast gold-in-soil anomaly and intersected 27.0 metres at 6.94 g/t gold from 20.0 metres to 47.0 metres depth in saprolitic granite (see map on website), including two metres at 84.3 g/t gold. The hole was drilled 400 metres southeast of hole 121 which intersected 7.8 metres at 8.44 g/t gold (see press release dated July 21, 2011) and may be the same mineralized structure. Holes 132 and 134 failed to intersect significant mineralization.

The identification of a second high-grade drill intersection in the Central Southeast gold-in-soil anomaly suggests the presence of a potentially significant new mineralized zone at Cuiu Cuiu immediately southeast of the Central zone. Significant gold mineralization has been intersected in two out of three holes along strike and extends over a distance of at least 400 metres. These results come after the recent announcement of a new mineralized zone at Central North which is located a minimum of 360 metres north of the Central body (see press release dated Sept. 8, 2011). Further drilling at both Central Southeast and Central North is in progress.

Alan Carter, president and chief executive officer of Magellan, commented: "Hole 138 is a significant intersection by any measure and is important because it is located 600 metres south of the Central zone which contains an inferred resource of 500,000 ounces and an indicated resource of 100,000 ounces of gold. These results come on the heels of the recent announcement regarding the discovery of a new zone at Central North and supports our strategy of drilling step-out and exploration holes beyond the existing resources. This drilling is aimed at identifying additional mineralized zones at Cuiu Cuiu."

Drill hole intersections discussed in the text are summarized in the associated table.

                          
                               DRILL RESULTS

Hole ID                   From (m)           To (m) Width (i) (m)   Gold (g/t)

Central Southeast
DDH 138                       20.0             47.0          27.0         6.94
incl.                         24.0             26.0           2.0         84.3
DDH 132                                                 No significant results
DDH 134                                                 No significant results
Jerimum Baixo
DDH 137                          0              7.0           7.0         0.76
                              29.6             31.6           2.0         0.69
                              41.6             66.6          25.0         0.49
                              73.6            132.6          59.0         0.28
DDH 139                                                 No significant results
Moreira Gomes zone
DDH 136                                                 No significant results
DDH 140                       64.0             83.0          19.0         0.48

Notes
(i) All holes were drilled at minus 50 degrees. Dips of the intersected      
structures are not known, and intersection widths are not necessarily   
true widths.     
                                                       

Jerimum Baixo

Results were received on two exploration holes from Jerimum Baixo, which is located between the Central and Moreira Gomes deposits and is not currently part of the resource at Cuiu Ciuu. Previous reconnaissance drilling on this anomaly has returned results up to 105.2 metres at 0.6 g/t including 41 metres at 1.3 g/t gold. Hole 137 was drilled 50 metres west of hole 135 and intersected seven metres at 0.76 g/t from zero to seven metres, two metres at 0.69 g/t gold from 29.6 to 31.6 metres, 25 metres at 0.49 g/t gold from 41.6 to 66.6 metres and 59 metres at 0.28 g/t gold from 73.6 to 132.6 metres depth (see map on website). The mineralized zones intersected in hole 137 are almost certainly the same zones recently reported from hole 135 (see press release dated Sept. 8, 2011). Hole 139 was drilled 110 metres west of hole 137 and cut no values of interest.

Results have now been received on four holes at Jerimum Baixo during 2011 bringing the total number of holes drilled in this zone to 12. Gold mineralization at Jerimum Baixo is now known to be continuous over an area of at least 350 metres by 35 metres and trends in an east-southeast-west-northwest direction. The mineralized zone remains open, particularly to the south, and results are currently pending on three additional step-out holes.

Moreira Gomes

Results have been returned on two additional holes from the western part of the Moreira Gomes zone which contains an inferred resource of 700,000 ounces of gold (14 million tonnes at 1.5 g/t gold) (see map on website). Hole 140 was drilled between holes 62 and 49 and cut 19 metres at 0.48 g/t gold from 64 metres to 83 metres depth demonstrating the continuity of gold mineralization over the western part of Moreira Gomes. Hole 136 cut no values of interest and was drilled as an 80-metre step-out hole west of hole 133 which was the most westerly drill hole at Moreira Gomes. Magellan currently has three drill rigs operating at Cuiu Cuiu, with drilling expected to continue at least until the end of 2011. Results are currently pending on additional step-out and exploration drill holes from Central North, Central Southeast and Jerimum Baixo, all of which are targeting areas outside the current resources. Current resources at Cuiu Cuiu total 1.2 million ounces (31 million tonnes at 1.2 g/t) of gold in the inferred category and 100,000 ounces (3.4 million tonnes at one g/t) of gold in the indicated category.

Holes were drilled at 50 degrees from horizontal. All core samples (HQ diameter) were cut with a diamond saw and one-half of the core placed in bags, numbered and sealed then sent via a secure transport agency to the company's office in Itaituba before shipping via secure transport to ACME preparation laboratory in Itaituba for sample preparation. Core samples were crushed down to two millimetres, and a one-kilogram split was pulverized to better than 85 per cent minus 200 mesh. From Itaituba, ACME sent the pulp samples to Santiago, Chile, for assaying. Gold analyses were conducted on 30-gram representative sample cuts using fire assay with an atomic absorption finish. Other sample cuts were subjected to a four-acid digestion and analyzed for silver and an additional 35 elements using inductively coupled plasma mass spectrometry (ICP-MS). ACME is an ISO 9001-registered laboratory and has a quality control program in place which includes the insertion of standard, blank and duplicate samples, as well as conducting repeat analyses.

Magellan's QA/QC (quality assurance/quality control) program also includes the insertion of standards, field duplicates and blank material in the sample sequence with the normal core samples to monitor sampling variances, laboratory precision and accuracy.

This press release was reviewed by Dennis Moore, BSc, MEng, a member of AIG, AusIMM and the SEG, a qualified person in compliance with National Instrument 43-101.

We seek Safe Harbor.