SPOKANE,
WA––March 27, 2008–– Minera Andes Inc. (TSX: MAI
and US OTC: MNEAF) announced today details of the San Jos� mine
performance to 31 December 2007. The San Jos� project is operated by
Minera Santa Cruz S.A. (“MSC”) and is owned 51% by Hochschild
Mining plc (“Hochschild”) (HOCM.L: Reuters and HOC LN:
Bloomberg - London Stock Exchange) and 49% by Minera Andes. The San Jos�
mine commenced production during the second quarter of 2007 and
approached full production by year-end 2007. Hochschild forecasts that
the processing plant, which is still in the commissioning phase, is to
reach full capacity in the first half of 2008. Plans are underway to
expand the mine and double the current production rate by year-end 2008.
Exploration
In 2007, we saw
significant growth in the San Jos� project through its exploration
program results. The last independent NI43-101 Technical Report
commissioned by Minera Andes was released in November 2007 and showed an
increase in reserves at San Jos� of more than 100%, based on surface
drilling and under ground exploration completed in 2006 through the first
half of 2007.
On March 12, 2008,
Hochschild released updated resource and reserve estimates at San Jos� in
their Preliminary Results for Year Ended 31 December 2007. These results
show an increase in reserves of 19% and an increase in resources of 28%
over the year ended 31 December 2006 JORC Code results. Currently Minera
Andes cannot endorse these results as only a part of the data on which
the resource /reserve calculations are based has been released to Minera
Andes. Minera Andes is in the process of obtaining this information and
will review the data and report on the results as soon as practicable. Exploration
work completed in the second half of 2007 includes 20,274 meters
(82 holes) of drilling mainly on Frea, Odin, and Ayel�n veins and several
hundred meters of drifting along the Frea vein. Receipt of assay results
is underway for 19 drill holes. The Frea, Odin, and Ayel�n veins all have
mineral potential and remains open at depth and along strike.
MSC plans a 2008
exploration program at San Jos� consisting of mapping, compilation and
interpretation of all project data on a district scale (115 km2) to
identify new targets. Approximately 4,000 meters of
surface drilling and 3,800
meters of underground drilling are planned for
2008 as a follow-up on the targets generated from the surface work.
Expansion
Based on the
significant increase in the reserves during 2007, the board of MSC last
November approved an expansion at San Jose from 750 to 1,500 tonnes per
day, thereby doubling the rate of production at San Jos�. Minera
Andes anticipates the expansion to be completed by year-end 2008.
Various pieces of new
equipment have been ordered by MSC for the mine expansion, including a
new ball mill, flotation cells, a crusher and other ancillary
equipment. Also, work to connect to the national power grid is
underway, and this connection is forecast to provide significant cost
savings over the on-site diesel generators that currently supply the
electrical power to the project. Following connection to the power
grid, the diesel generators will be retained as a backup power supply.
Production
The San Jos� mine now
comprises more than 13
km of underground workings accessed by ramps
accessing the Huevos Verdes and Frea veins. A third ramp has also been
constructed to access the Kospi vein, where 173 meters of the
vein have been developed to date. The mine is currently staffed with 436
employees and 148 contractors.
The San Jos�
gold/silver mine saw a steady increase in production in Q4 2007 as
reported by MSC to the owners. The San
Jos� mine is currently operating at rate of 750
tonnes per day. The first sales of metal from the mine occurred in
December of 2007. The sales of the metals that were produced during the
construction/commissioning phase of the plant went to reduce the capital
required for 2007. At year-end the mine had had about 90% of its metal in
inventory in the form of concentrates and dor�. Several contracts are in
place to sell dor� and concentrate production.
SAN JOSE MINE PRODUCTION
Product
|
Q4
2007
|
Q3
2007
|
Full year
2007
|
Ore production (tonnes)
|
65,480
|
27,494
|
92,974
|
Average
head grade silver (g/t)
|
536
|
544
|
538
|
Average
head grade gold (g/t)
|
7.03
|
7.21
|
7.08
|
Silver
produced (ounces)
|
776,000
|
182,000
|
958,000
|
Gold
produced (ounces)
|
11,660
|
3,300
|
14,960
|
Net silver
sold (ounces)*
|
92,000
|
0
|
92,000
|
Net gold
sold (ounces)*
|
1,490
|
0
|
1,490
|
*855 ounces of gold
and 42,379
ounces of silver were produced during construction
phase of the plant and have been recorded as a reduction to the
capitalized cost of the plant.
During the start-up
of San Jos� in Q2 2007, several factors contributed to delays in the
processing plant becoming fully operational, including technical issues
related to the mill and the flotation process; problems with the
intensive leaching process that produces a precipitate that is converted
into dor�, and extreme August weather conditions. We are advised
that although the processing plant is now operating at capacity, the
intensive leaching process remains in the commissioning stage.
Re-engineering work is currently underway to improve the
detoxification process. The operator expects theses issues to be
corrected in the first half of 2008.
Allen V. Ambrose, Minera Andes' President, who is an appropriately
“qualified person” as defined by National Instrument 43-101,
is responsible the information used in this news release and has
supervised the preparation of the information and reviewed all
information used in this news release.
Minera Andes is a gold, silver and copper exploration company working
in Argentina. The Corporation holds about 410,000 acres
of mineral exploration land in Argentina including the co-owned San Jos�
silver/gold mine that has recently commenced production. Minera Andes is
also exploring the Los Azules copper project in San Juan province, where
an exploration program is underway to define a resource. Other
exploration properties, primarily silver and gold, are being evaluated in
southern Argentina. The Corporation presently has 189,334,935 shares
issued and outstanding.
This news is submitted by Allen V. Ambrose, President and Director of
Minera Andes Inc.
For further information, please contact: Art Johnson at the Spokane
office, or Krister A. Kottmeier, investor relations – Canada, at
the Vancouver office. Visit our Web site: www.minandes.com.
Spokane Office
111 East Magnesium Rd.,
Spokane, WA 99208 USA
Phone: (509) 921-7322
E-mail: mineraandes@minandes.com
|
Vancouver
Office
Suite 911 - 470 Granville St,
Vancouver, BC. V6C 1V5
Phone: (604) 689-7017 / 877-689-7018
E-mail: ircanada@minandes.com
|
Caution
Concerning Forward-Looking Statements:
This press release contains certain "forward-looking
statements", including, but not limited to, the statements regarding
the Company's strategic plans, evolution of mineral resources and
reserves, work programs, development plans and exploration budgets at the
Company’s San Jos� Project. Investors should be aware that the
introduction of new technology such as ILR can create added risk in
achieving metallurgical performance. The forward-looking statements
express, as at the date of this press release, the Company's plans,
estimates, forecasts, projections, expectations or beliefs as to future
events and results. Forward-looking statements involve a number of risks
and uncertainties, and there can be no assurance that such statements
will prove to be accurate. Therefore, actual results and future events
could differ materially from those anticipated in such statements. In
particular, there can be no assurance that commercial production at the
San Jos� mine will be achieved on a timely basis, or at all, that
production capacity at the San Jos� mine will be successfully increased,
that resources and reserves at the San Jos� mine will be increased or
that Minera Andes will successfully raise the funds necessary to maintain
its interest in the San Jos� mine. Risks and uncertainties that could
cause results or future events to differ materially from current
expectations expressed or implied by the forward-looking statements
include, but are not limited to, factors associated with fluctuations in
the market price of precious metals, mining industry risks, risks
associated with foreign operations, the state of the capital markets,
environmental risks and hazards, uncertainty as to calculation of mineral
reserves and other risks. We refer readers to the risk factors and
uncertainties described in the Company’s continuous disclosure
record, a copy of which is available under the Company’s profile at
www.sedar.com. Minera Andes’ joint venture partner, a subsidiary of
Hochschild Mining plc, and its affiliates do not accept responsibility
for the use of project data or the adequacy or accuracy of this release.
Cautionary Note to U.S. Investors:
The United States Securities and Exchange Commission (the
"SEC") permits mining companies, in their filings with the SEC,
to disclose only those mineral deposits with “mineral
reserves” that a company can economically and legally extract or
produce. We use certain terms in this press release, such as "mineral
resources", that the SEC guidelines strictly prohibit us from
including in our filings with the SEC, because these terms are common
usage in Canada and form part of our Canadian filing requirements.
THE TSX HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS RELEASE.
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