Callinan to Raise $6.3 Million by Private Placement

September 19, 2006

Callinan Mines Limited announces that it will conduct a non-brokered private placement of up to 3,200,000 Flow-Through Units of Callinan at a price of $1.25 per Flow-Through Unit, to raise gross proceeds of up to $4,000,000, and up to 2,000,000 Non-Flow-Through Units of Callinan at a price of $1.15 per Non-Flow-Through Unit, to raise gross proceeds of up to $2,300,000.

Each Flow-Through Unit will consist of one common share and one fourth (¼) of one share purchase warrant, each whole warrant entitling the holder to purchase an additional common share of Callinan for a period of one year from closing at a price of $1.50 per share. The shares included in the Flow-Through Units, excluding any common shares issued upon the exercise of warrants, are to be qualified as “Flow-Through” shares under the Income Tax Act (Canada).

Each Non-Flow-Through Unit will consist of one common share and one-fourth (¼) of one share purchase warrant, each whole warrant entitling the holder to purchase an additional common share of Callinan for a period of one year from closing at a price of $1.50 per share.

Callinan will pay finders’ fees on a portion of the private placement in accordance with policies of the TSX Venture Exchange.

The proceeds from the sale of the Flow-Through Units will be used mainly for the exploration of Callinan’s Fox River project located in Manitoba, and the Coles Creek project located in British Columbia. The proceeds from the sale of the Non-Flow-Through Units will be used for any new project acquisitions, working capital and general corporate purposes of Callinan.

This private placement is subject to acceptance by the securities regulatory authorities.

On behalf of the Board of Directors

of CALLINAN MINES LIMITED

_______________________________

Mike Muzylowski

President and CEO