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| Dear Karolina Domenech, |
April 1, 2008 |
CANATUAN MINE OPERATIONS UPDATE:
TVI PROVIDES 2007 YEAR END OPERATING REVIEW FOR CANATUAN MINE, PHILIPPINES
TVI Pacific Inc. (TSX: "TVI" or the "Company") today provided a 2007 operations review for the Canatuan Mine, located in the Southern Philippines, and operated by its affiliate, TVI Resource Development (Phils) Inc. ("TVIRD").� This news release should be read in conjunction with the Company's audited consolidated Financial Statements and Management's Discussion and Analysis for the year ended December 31, 2007, which have been filed with certain securities regulatory authorities in Canada and are available on SEDAR (www.sedar.com) and on the Company's website (www.tvipacific.com).�
The Canatuan Mine processed a record 740,099 dry metric tonnes ("dmt") in 2007, a 25% increase from the 591,180 dmt processed in 2006.� However, due to expected lower metal grades and recoveries, the project produced 45,905 gold equivalent ounces ("AuEqOz") in 2007, down 19% from the 56,880 AuEqOzs produced in 2006.� Production during 2007 consisted of 33,078 ounces of gold ("Au") and 653,278 ounces of silver ("Ag"), compared with the 45,210 ounces of gold and 608,507 ounces of silver produced in 2006.
Tonnes processed at the Canatuan Mine have increased year-over-year since the start of production in mid-2004.� Full year mill throughput of 192,870 dmt in 2005 improved to 591,180 dmt in 2006 and to 740,099 dmt in 2007. However, the highest gold grades were encountered at the top of the oxide deposit, near surface, and gold grades decreased with depth as mining approached the underlying sulphide deposit. Another consequence of mining closer to the sulphide deposit has been that the copper content in the oxide ore has increased with depth, affecting metal recoveries. Copper competes with gold in the processing circuit and leads to overall lower gold recovery. Both factors, the lower grade and recovery with depth, have affected metal production at the Canatuan Mine.� The substantial increase in tonnes processed was not able to fully offset the lower grades and recoveries.
"Since the start of operations in mid-2004, we believe the Canatuan gossan operation has served the Company well," said Clifford M. James, TVI President and CEO. "Cash flows from the gossan operation to date have financed much of the next phase of operations, the Canatuan sulphide project, as well as the exploration of other projects such as the Balabag gold property.� In light of the anticipated conclusion of the mining and milling of gossan ore using the CIL - Merrill-Crowe recovery system at Canatuan, we are examining alternatives for the further extraction of gold and silver. With the current high precious metal prices, tailings material within our earlier tailings dams and material previously classified as waste from mining operations may now represent possible opportunities to profitably extract both gold and silver using flotation and heap-leach processes, respectively.� These opportunities, which we are actively considering, exist irrespective of future exploration activities in the Canatuan area."
The following table summarizes the Canatuan Mine's operating statistics for the periods noted.
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During 2007, the Canatuan Mine set a production record for mill throughput, averaging 2,028 dmt per day compared to 1,620 dmt in 2006, an increase of 25%.� For the fourth quarter, average mill throughput increased to a record rate of 2,158 dmt per day, compared to the 1,953 dmt achieved in the third quarter of 2007, an increase of 10%.� Lower throughput rates in the third quarter of 2007 were primarily attributable to a five-week ball mill shutdown during which mill throughput was affected.� Since that time, a number of new initiatives, designed to optimize mill production, have been implemented at Canatuan with the intention of improving mill throughput.�
Also during the third quarter of 2007, unusually heavy precipitation adversely affected haul roads and pit bottoms, particularly in areas where higher grade ore is mined. As a result, a significant portion of the mill feed was taken from lower grade stockpiles, which are ordinarily blended with higher grade ores from active pits. In the fourth quarter of 2007, TVI essentially depleted higher grade ore sources as the gossan operations approached the end of reserve life.� As a result, the ore grades and metal production continued to decline in line with expectations.
The average feed grades during 2007 were 1.60 grams per tonne ("gpt") of gold and 56.29 gpt of silver, compared with 2.72 gpt of gold and 51.78 gpt of silver during 2006.� On a quarterly basis, the feed grades for the fourth quarter of 2007 were 1.10 gpt for gold and 46.21 gpt for silver, versus 2.04 gpt for gold and 40.52 gpt of silver for the comparable period in 2006.� As expected, 2007 witnessed a decrease in the average feed grade as the remaining gossan reserves were characterized by increasingly lower grades.� In addition, the nature of the feed changed, in that the chalcocite and sulphide content of the gossan ore increased as mining operations approached the massive sulphide zone underlying the gossan reserves. The presence of chalcocite and sulphides in the ore has caused a reduction in recoveries and has required the use of more cyanide.
Gold recoveries in 2007 declined slightly to an average of 87.12% while silver recoveries fell to 48.77%.� These values are lower than the 2006 recoveries of 87.49% for gold and 61.82% for silver.� Recoveries in the fourth quarter of 2007 noticeably decreased to 78.32% for gold and 26.12% silver, when compared to the 2006 fourth quarter recoveries of 89.76% for gold and 65.60% for silver.� The decrease in recoveries is also attributable to the increasing depth of the mining operation and its proximity to the copper and zinc bearing sulphide zone of the deposit.�
For additional information on the Canatuan Mine, please refer to the National Instrument 43-101 ("NI 43-101") technical report prepared by Geostat Systems International Inc. ("Geostat"), which was filed with certain securities regulatory authorities in Canada on August 21, 2006 and is available on the SEDAR website at www.sedar.com.� The Geostat report assesses the gossan mineral reserves and resources at the Canatuan deposit.
About TVI Pacific Inc.� (TSX: TVI)
TVI Pacific Inc. is a publicly traded Canadian mining company focused on exploring for and producing precious and base metals within district scale systems in the Philippines. The Company's interest in the Canatuan Mine and its other Philippine assets are held through its affiliate, TVI Resource Development (Phils.) Ltd.� TVI's most advanced project, the Canatuan Mine, currently produces gold and silver dor�.� On March 13, 2008, the Company signed a definitive US$15 million bridge financing agreement with an arms length party for the purpose of provided working capital funding for TVIRD, including funds to restart construction of the sulphide project at Canatuan.� The Company has substantially completed the conditions to the first drawn down under the financing agreement.
Further Information:�� �Clifford M. James, President and CEO
������������������������������ Paul Moon, Director, Corporate Communications�(403) 265-4356
Carl L. Caumartin BSc, P.Eng., MBA, Vice President, Exploration of TVI Pacific Inc., serves as TVI's "Qualified Person" (for purposes of National Instrument 43-101 - Standards of Disclosure for Mineral Deposits) on the Canatuan project and has reviewed this News Release.
The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.
2000, 736 - 6� Avenue S.W.� Calgary, Alberta T2P 3T7�����
Tel: (403) 265-4356�Fax: (403) 264-7028
Website: http://www.tvipacific.com���E-mail: tvi-info@tvipacific.com
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