Mount Kellett Sends Letter and Mails Proxy Circular to Baja Shareholders

Mount Kellett Capital Management LP ('Mount Kellett?), the largest
shareholder of Baja Mining Corp. (TSX:BAJ) (OTCQX: BAJFF) ('Baja? or the
'Company?), today sent a letter and mailed its Proxy Circular to Baja
shareholders urging them to vote for two new independent shareholder
nominees at the Special Meeting of Shareholders to be held on April 3,
2012. For more information on how to vote, as well as access to other
important materials, please visit www.ShareholdersForBaja.com.

In the Proxy Circular, Mount Kellett highlights an ongoing pattern of
poor corporate governance and self-dealing at Baja, much of it stemming
from the conduct of its own chief executive officer, Mr. John
Greenslade. Mount Kellett requisitioned the Special Meeting of
Shareholders and is urging shareholders to take immediate action and
vote for two independent and highly qualified director nominees ? Mr.
Stephen Lehner and Mr. Lorie Waisberg. Once elected, Mr. Lehner and Mr.
Waisberg will comprise a minority of the Baja board and will work with
the other directors to enhance and maintain corporate governance and
management oversight.

Mount Kellett Chief Operating Officer Jonathan Fiorello said, 'Mount
Kellett is a strong believer in the potential of the Boleo project,
Baja′s high-grade, long-life copper asset. We requisitioned a special
meeting of Baja shareholders because we have significant and
well-founded concerns that the current board and management have become
distracted with their own personal agendas and enrichment.

'We are particularly concerned that, at the cusp of bringing the Boleo
project online, Baja management intends to pursue a related party
transaction with a high-risk early stage copper company, Catalyst Copper
Corp. Catalyst′s principal attraction seems to be its connection with
select members of Baja′s management and board, who own a combined 6
percent of Catalyst ? far more than they own of Baja itself.

'It is necessary for shareholders to act now to protect their interests
in Baja and the Boleo project. We are confident that the election of our
two experienced and independent director nominees will secure the
necessary oversight to protect shareholder value and stop the pattern of
poor governance and self-dealing at Baja.?

Mount Kellett encourages shareholders to carefully review its Letter to
Baja Shareholders (included below) and the Proxy Circular and vote only
their BLUE proxy in advance of the
proxy voting deadline of March 30, 2012 at 7:00 am (Vancouver Time).

Voting Instructions: If you have any
questions and/or need assistance in voting your shares, please call
Kingsdale Shareholder Services at 1-888-518-1562 or 1-416-867-2272
(collect calls accepted).

Mount Kellett recommends that shareholders send a message to the Board
by voting only the BLUE proxy:

• 
  'FOR' the resolution to
  remove Giles Baynham and Gerald Prosalendis as directors of Baja;
  
• 
  'FOR' the resolution to
  increase the size of the board to 9, making room for 2 new independent
  shareholder nominees to join the board
  
• 
  'FOR' the election of Stephen
  Lehner and Lorie Waisberg as new independent directors of Baja to
  increase governance and oversight on behalf of all shareholders; and
  
• 
  'FOR' the stock option plan
  amendment resolution to make the Baja stock option plan compliant with
  recognized governance standards
  

In order to make their voices heard, shareholders are urged to vote the BLUE
proxy well in advance of the proxy voting deadline of March 30, 2012 at
7:00 am (Vancouver Time).

The full text of the letter follows:

February 22, 2012

Dear Fellow Shareholders:

Like you, Mount Kellett Capital Management LP ('Mount Kellett') is a
strong believer in the potential of Baja Mining Corp. ('Baja') and the
Boleo project, the company's large, high-grade, long-life copper deposit
located in Baja California Sur, Mexico. This primary copper asset
represents significant potential value for all shareholders that support
its development and growth. That is why we have invested more than
$80,000,000 in Baja.

The Success Of Baja's Boleo Project Should Be The Primary Focus

We have asked for a shareholders′ meeting and are seeking your support
because we have significant and well-founded concerns that the board and
management have become distracted with their own personal agendas and
enrichment. They do so at a time when they should maintain discipline
and focus on the development and growth of the Boleo project so that its
full value can be realized.

We are particularly concerned that, at the cusp of bringing the Boleo
project online, Baja management intends to pursue a related party
transaction with a high-risk early stage copper company, Catalyst Copper
Corp. ('Catalyst'), which is listed on the TSX Venture Exchange.
Catalyst has optioned a speculative exploration asset in Mexico that
will likely cost hundreds of millions of dollars to bring online. In
fact, we understand that Baja management has already sought approval to
invest Baja's money in this unproven enterprise ? at
a time when Baja itself is not yet generating revenue.

Catalyst′s principal attraction seems to be its connection with select
members of Baja′s management and board, who own a combined 6 percent of
Catalyst ? far more than they own of Baja itself. Baja CEO, Mr. John
Greenslade, is also the CEO of Catalyst and a major shareholder and
director in the company ? with compensation of $300,000 in 2011 paid by
Catalyst and a minimum $360,000 golden parachute. Mr. Greenslade became
CEO of Catalyst over the strong objections of some of the prior members
of Baja's board who were subsequently not nominated for re-election at
the 2011 Annual General Meeting.

Shareholders Could Be Irreparably Harmed By Mr. Greenslade's
High-Risk Plans

Mr. Greenslade has stated that he wants Baja to pursue a transaction
with Catalyst. Such a course of action poses significant risk to Baja's
value and is rife with conflicts of interest. Not only does Mr.
Greenslade own over 10,000,000 shares of Catalyst, which is more than he
owns of Baja, but his daughter Ms. Denby Greenslade (who is the interim
CFO and Corporate Secretary of Catalyst) would also stand to profit
handsomely if Baja was to acquire Catalyst. Mr. Gerald Prosalendis, a
director at both Baja and Catalyst, would also receive substantial
rewards. Indeed, should Baja acquire Catalyst, which it could do without
seeking shareholder approval, current Baja directors and officers would
stand to reap millions of dollars in gains.

We believe a transaction with Catalyst, in the absence of independent
board oversight, would result in an unfair and unwarranted transfer of
Baja's value to Catalyst insiders ? who also happen to be Baja insiders
? and substantially increase Baja's risk profile. The only low-risk
aspect of such a transaction is the significant financial reward that
Mr. Greenslade and his family and friends would receive from any such
deal.

Two new independent directors who have an 'owner driven mindset' are
urgently needed to ensure that any transaction brought by management or
an outside party is assessed solely on its potential to create
compelling and confirmed value for all Baja shareholders and not just
for its insiders.

The Baja Board Is Beholden To Mr. Greenslade

Our concerns regarding Catalyst are compounded by an ongoing pattern of
poor governance and self-dealing at Baja, much of which stems from the
conduct of its own CEO. Mr. Greenslade seems to have unchecked influence
over the current board because, we suspect, either they are his
long-time allies and are deeply entrenched to his agenda, or because
they are fearful to oppose him.

Consider the following:

• Interlocking and Handpicked Directors - In May 2011, two
  long-time directors of Baja were not nominated for re-election after,
  we understand, they objected to Mr. Greenslade assuming the role of
  President, CEO and Director of Catalyst. The objections of these
  directors are understandable because Catalyst is a competitor and Baja
  requires and deserves full-time management. The directors who
  challenged Mr. Greenslade's behaviour were replaced by Mr. François
  Marland and Mr. Prosalendis, who are interlocking directors with Mr.
  Greenslade at Yukon-Nevada Gold Corp. and Catalyst, respectively. In
  addition, another director handpicked by Mr. Greenslade was appointed
  to the board, Mr. Giles Baynham. As we describe in detail in the Proxy
  Circular, they have all demonstrated a pattern of looking out for each
  other's interests.
  
• Stock Options for Loyalty - After Messrs. Prosalendis, Marland
  and Baynham joined the board, they were promptly appointed as the only
  3 members of the Baja Compensation Committee, which sets Mr.
  Greenslade's compensation. At the first board meeting, just hours
  after the 2011 Annual General Meeting at which shareholders approved a
  stock option plan that was promoted by Mr. Greenslade as being
  essential to hire senior management candidates and key personnel,
  Messrs. Prosalendis, Marland and Baynham were awarded 2,250,000
  options in the aggregate. The awards to Messrs. Prosalendis, Marland
  and Baynham are grossly disproportionate to what independent directors
  would customarily receive and were certainly not awarded on merit as
  they had yet to make any discernable contribution to the company's
  success. Fully 43% of the options then available for grant under the
  stock option plan went to Mr. Greenslade and his friends on the board,
  with only 27% of those available going to the actual operating
  management of Baja.
  
• Disregard of Baja Corporate Charter - During the same month,
  Mr. Greenslade was named chairman of Baja in breach of the company's
  own board charter, which clearly states:
  

'[i]n order to carry out its fiduciary duty, as well as its duty of
care and loyalty to the Company and its shareholders, the members of the
Board will?annually appoint an independent director as Chair of the
Board.'

In addition, we believe that Mr. Greenslade used the support of his
newly enriched friends to orchestrate a separation of the nominating and
governance committees. He was then appointed to the Nominating
Committee, which chooses directors to serve on the board, further
cementing his control over Baja. These actions were a breach of the most
basic of governance principles.

• Conflicted, Under-qualified and Overpaid Corporate Secretary -
  Ms. Kendra Low, one of Mr. Greenslade's daughters, is Baja's Corporate
  Secretary. Ms. Low has been unduly enriched by her father and the
  board. In 2010, Ms. Low received the extraordinary compensation
  package of $725,000, and in 2011 was awarded an $800,000 golden
  parachute ? making her one of the highest paid
  corporate secretaries in Canada. She now has received options
  for a total of at least 1,300,000 Baja common shares. Of course, her
  father's majority-controlled Compensation Committee, who Mr.
  Greenslade helped enrich through stock options, enhanced Ms. Low's
  compensation package. Ms. Low continues in her position as Corporate
  Secretary of Baja, notwithstanding the recent approval of an
  anti-nepotism policy by the board after Mount Kellett first raised the
  issue.
  
• Expanding Golden Parachutes - The board continues to
  rubber-stamp Mr. Greenslade's enrichment schemes. Mr. Greenslade's
  golden parachute was recently expanded by $680,000 to $1,980,000. His
  daughter also recently received a 21% increase in her salary and
  target bonus and a 42% increase in her golden parachute.
  

These examples clearly show governance failures and Mr. Greenslade's
extraordinary influence over Baja's board ? to the point where, instead
of the chief executive reporting to the directors, as is normal
practice, the board in effect reports to Mr. Greenslade. We believe that
under Mr. Greenslade′s command, the board is turning a blind eye to
self-dealing, condoning nepotism, and failing in its fiduciary
obligation to all shareholders.

The Board Fails To Understand That There Is A Problem

Case in point is the feeble reaction of the board to our requisition for
a special meeting of shareholders to elect two new independent
directors. In December 2011, we filed a requisition seeking an expansion
of the board, a cap on stock options and several non-binding ordinary
resolutions dealing with conflicts of interest and improved independence
practices, all to address readily apparent corporate governance failings.

Baja's response was to publicly announce the adoption of select policies
to address some of the transgressions we brought to the spotlight.
However, this is the same board that condoned breaches of its own
corporate charter and allowed brand new directors to enrich
themselves with huge option grants. We reject the board of Baja's
announced governance initiatives as wholly inadequate to prevent the
continuation of the self-dealing, lack of independence and poor
oversight of the board. What shareholders need and deserve are
independent directors who will make sure that the board functions as a
proper steward on behalf of all shareholders.

Shareholders Need To Take Action To Protect Their Investment

The need for action is increasingly urgent. We believe that the market
value of the company does not reflect the substantial value of the Boleo
project. Failing to place truly independent, determined individuals on
the board could seriously jeopardize the project's potential benefit to
shareholders.

We propose the election of Mr. Stephen Lehner and Mr. Lorie Waisberg,
who will represent a small minority of the board, to help ensure that
the company is run for the good of all shareholders and not for the
private benefit of the CEO, his family and handpicked directors. Messrs.
Lehner and Waisberg, acting as true fiduciaries for the company and not
as pawns in what has effectively become Mr. Greenslade's family office,
will be in a position to bring transparency, honesty, and ethics to all
aspects of Baja's business. Once elected, Mr. Lehner and Mr. Waisberg
will work with the other directors to enhance and maintain corporate
governance and management oversight. They will
work for all shareholders, large and small.

Mount Kellett Is NOT Pursuing A Takeover
Of Baja

As we publicly stated in our press release of February 13, 2012, Mount
Kellett is not interested in pursuing a takeover of Baja. We have become
a significant minority investor because of our fundamental belief in the
value of the Boleo project. We have twice proposed to enter into
standstill agreements, most recently in January 2012, in exchange for
appropriate governance changes at Baja, but have not once received
interest from the company. In fact, if Mr. Greenslade had concerns about
Mount Kellett′s intentions, it is surprising that neither he nor the
board requested a standstill agreement as part of the public proposal
disclosed by Baja on January 12, 2012.

Baja's baseless smokescreen and fear mongering that Mount Kellett
is intending a creeping takeover is meant to distract shareholders from
the key issue: Baja's board has proven itself incapable of providing
good corporate governance or oversight of management. The board has
rejected true independent oversight and has unfairly mischaracterized
Mount Kellett's good faith actions to protect value for all shareholders.

Elect Two New Independent Directors Committed To Acting In Your
Interest

We view Mr. Greenslade's desire to have Baja pursue a transaction with
Catalyst as extremely risky, particularly without appropriate oversight
by truly independent directors. It is now up to all shareholders to
protect their investment in Baja by electing two new independent
directors whose primary agenda will be to help the company realize the
full potential of the Boleo project and to work with the board to reset,
and then maintain, the company's governance practices.

For more information please visit www.ShareholdersForBaja.com.

We look forward to your support.

PLEASE VOTE YOUR BLUE PROXY IN SUPPORT
OF THE SHAREHOLDER NOMINEES.

About Mount Kellett Capital Management LP

Mount Kellett is a multi-strategy private investment firm focused on
global value, special situations and opportunistic investing. The firm
has approximately 100 employees with offices in New York, Hong Kong,
London, and Mumbai. The firm currently has in excess of $6 billion in
assets under management.

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