urce: GoldSeek.com

VANCOUVER, BRITISH COLUMBIA--(Marketwire - 01/11/11) - United Mining Group, Inc. (the "Company") (TSX:UMG)(Pinksheets:UMGZF)(Frankfurt:UM8) announces that it has completed its agreement, announced on October 7, 2010, with the New Jersey Mining Company (NJMC) to secure near term milling capacity for the Company.

The agreement calls for UMG to provide the necessary funding to expand the mineral processing plant to 360 tonnes per day estimated to be $US 2.3 million and gives UMG a one third equity ownership after completion of the expansion. NJMC will continue to be the Operator. NJMC will conduct a metallurgical test on bulk samples from both the Alhambra and South veins before plant expansion work starts. The samples will be extracted through the Countess decline which to date has been advanced approximately 1500 feet from the portal and is expected to be completed by the end of the first quarter.

Initial metallurgical bench testing has been completed from drill core from these veins and the bulk sample will be used to verify the recovery, concentrate characteristics, flotation equipment design and ultimate milling capacity obtained through previous milling operations for the mine.

Charles Pitcher, Chief Executive Officer, comments, "We are very pleased to have a relationship with Fred Brackebusch, a well experienced local engineer and President of NJMC. We have already initiated discussions for growing the facility to eventually accommodate the treatment of the Crescent Silver Mines' ultimate annual production target of 4 million ounces of silver."

Fred Brackebusch, Chief Executive Officer of NJMC, commented: "The New Jersey Mill Joint Venture will be beneficial for both NJMC and UMG by reducing operating and capital costs for processing ores from both companies' mines."

About United Mining Group

United Mining Group is a vertically integrated mining company with operations in Idaho, USA. The Company offers a full suite of mining services including contract mining to silver miners in the district. The Company owns its own custom welding and fabrication shop allowing it to repair/rebuild equipment for its own use and for outside mining companies.

The Company is currently earning, through development and operations, an 80% interest in the Crescent Silver Mine adjacent to the Sunshine Silver Mine in the Silver Valley.

The Crescent Mine has historically produced 25 million ounces of silver at an average grade of 27.3 opt (SRK Consulting 43-101 report, March 1, 2010).

UMG is committed to building a senior silver-producing mining company based on aggressive exploration and development of the highly-prospective current land position at Crescent and through the acquisition of additional precious metals interests.

Charles Pitcher, Chief Executive Officer