Silver Dragon Signs Definitive Agreement to Sell Erbahuo Mine in China

BEIJING, Oct. 5, 2009 (GLOBE NEWSWIRE) -- Silver Dragon Resources Inc.
(OTCBB:SDRG) is pleased to announce that it has entered into a definitive
agreement to sell its Erbahuo polymetallic project in China along with its
Chinese subsidiary, Chifeng Silver Dragon Resources & Technologies, Ltd., to a
private Chinese investor for RMB6 million or ~US$882,000 to the Company.
Proceeds from the sale of Erbahuo will be used for further exploration and
development of Silver Dragon's other properties in China, including Dadi and
Laopandao, of which Silver Dragon has a 40% interest and of its 100% owned
Cerros las Minitas silver property in Durango, Mexico.

Under the terms of the agreement, Silver Dragon will receive (i) a payment of
RMB1.8 million or ~US$260,000 within three business days; (ii) funds from the
return of the mine safety deposit in the amount of RMB303,695 or ~US$44,661;
(iii) funds from the return of the geologic environment governance deposit in
the amount of RMB553,135 or ~US$81,348; and (iv) 70% of the cash balance and
value of equipment and vehicles in Chifeng Silver Dragon, which result in total
proceeds of ~US$1 million net to the Company.

"I am pleased that we have been able to monetize our Erbahuo mine, which is the
smallest of our properties, so that we can focus on our prime assets in China
and Mexico," commented Marc Hazout, President and CEO of Silver Dragon Resources
Inc. "We are currently accelerating our exploration programs at our Dadi and
Laopandao properties, which we intend to develop into producing assets."

About Silver Dragon Resources Inc.:

Silver Dragon Resources Inc. is a mining and metals company focused on the
exploration, acquisition, development and operation of silver mines in proven
silver districts globally. Silver Dragon's objective is to acquire silver mining
assets that contain promising exploration targets, have highly leveraged,
out-of-the-money silver deposits, and/or are producing properties with
significant untapped exploration potential. It is management's objective to grow
Silver Dragon into a significant silver producer by developing Cerros las
Minitas in Mexico and Dadi and Laopandao in China. For more information, please
visit the Company's website at: www.silverdragonresources.com (now available in
Chinese).

Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995: The statements contained herein which are not historical, such as
statements regarding the exploration and development of the Liangdi Silver
Project, outcome and timing for the completion of further assays and metal
amounts in partial assay results, are forward-looking statements.
Forward-looking statements are statements that are not historical facts and are
generally, but not always, identified by the words "expects," "plans,"
"anticipates," "believes," "intends," "estimates," "projects," "aims,"
"potential," "goal," "objective," "prospective," and similar expressions, or
that events or conditions "will," "would," "may," "can," "could" or "should"
occur. Information inferred from the interpretation of assay results and
information concerning mineralization zones may also be deemed to be
forward-looking statements, as it constitutes a prediction of what might be
found to be present when and if a project is actually developed. Forward-looking
statements are subject to risks and uncertainties that could cause actual
results to differ materially from those expressed in the forward-looking
statements, including, but not limited to, certain delays beyond the company's
control with respect to future assay results, delays in testing and evaluation
of assays, and other risks detailed from time to time in the Company's filings
with the Securities and Exchange Commission.

The Silver Dragon Resources Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4242

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CONTACT: Silver Dragon Resources Inc.
Marc Hazout, President
(416) 223-8500
Toll Free: 1-866-512- SDRG (7374)
info@silverdragonresources.com
Investor Relations
Alessandro Motta
(416) 223-8500
Toll Free: 1-866-512- SDRG (7374)
info@silverdragonresources.com