Resource life up at San Jose

RNS Number : 6058U

Hochschild Mining PLC

19 October 2010

 



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19 October 2010 

Resource life at San Jose operation increased by approximately 50%

·      Discovery at San Jose significantly increases resource life of mine to approximately 12.5 years1

·      Total resources increased by 63 million silver equivalent ounces

o  28% increase from existing veins

o  72% increase from new veins and extensions

·      Highly prospective district with significant geological potential: ongoing intensive drilling campaign

·      Discovery represents continued delivery of strategy focused on growth through exploration

Following the discovery of nine new high-grade gold/silver veins and two extensions, announced last week,Hochschild Mining plc ("Hochschild" or "the Company") is pleased to report that resource life of mine² at its San Jose operation has increased from approximately 8.4 years as at December 2009 to approximately 12.5 years³ as at September 2010. This is a result of an intensive 47,431 metre drilling programme undertaken by the Company in the first nine months of the year which has increased total resources by 63 million silver equivalent ounces (the Company reported total resources of 110 million silver equivalent ounces as at 31 December 2009).

Ignacio Bustamante, CEO of Hochschild Mining said:

"Following last week's discovery, we are delighted to report this significant increase in resources at the San Jose operation which demonstrates our strategy in action. At the outset of the year, we committed to increasing the resource life of mine at our key operations and I am pleased to say that we are now seeing the results. Today's announcement reflects both the skill and experience of our exploration team and the enormous geological potential of the district, highlighted by the recent $3.6 billion bid for Andean's nearby Cerro Negro property. We are committed to value creation through organic growth and will continue to focus on exploration to maximise the full potential of our operations and projects."

Going forward, the discovery of the new system, which does not outcrop, will be used as an exploration guide to open up new opportunities at the property. To date, a significant portion of the San Jose property continues to be open at depth and laterally. Exploration drilling is continuing to expand resources in the known veins, including Ayelén and Odin, and exploration is also continuing in other areas of the property, such as the Saavedra and Aguas Vivas targets.

	Total resources4	Ag	Au	Ag Eq	Ag Eq	LOM5
	t	g/t	g/t	g/t	moz	yr
Resources at 31 December 2009	4,436,892	406	6.1	771	110.0	8.4
Existing Veins	704,319	438	5.4	762	17.3	1.3
New Veins and Extensions	1,841,410	379	6.5	772	45.7	3.5
Total additions	2,545,729	396	6.2	769	63.0	4.8

Enquiries:

Hochschild Mining plc

Isabel Lütgendorf                                                                              [phone]

Head of Investor Relations

Finsbury

Faeth Birch                                                                                          [phone]

Public Relations

About Hochschild Mining plc:

Hochschild Mining plc is a leading precious metals company listed on the London Stock Exchange (HOCM.L / HOC LN) with a primary focus on the exploration, mining, processing and sale of silver and gold. Hochschild has over forty years' experience in the mining of precious metal epithermal vein deposits and currently operates four underground epithermal vein mines, three located in southern Peru, one in southern Argentina and one open pit mine in northern Mexico. Hochschild also has numerous long-term prospects throughout the Americas.

About Minera Santa Cruz:

Minera Santa Cruz is a joint venture owned 51% by Hochschild Mining Argentina, a wholly owned subsidiary of Hochschild Mining plc, and 49% by Minera Andes S.A.. The joint venture owns and operates the San Jose property.

About Minera Andes:

Minera Andes is an exploration company exploring for gold, silver and copper in Argentina with three significant assets: A 49% interest in Minera Santa Cruz SA, owner of the San José Mine in close proximity to Andean Resources' Cerro Negro project; 100% ownership of the Los Azules copper deposit with an inferred mineral resource of 10.3 billion pounds and an indicated resource of 2.2 billion pounds of copper; and, 100% ownership of a portfolio of exploration properties bordering Andean's Cerro Negro project in Santa Cruz Province. The Corporation had $8 million USD in cash as at June 30th 2010 with no bank debt. Rob McEwen, Chairman and CEO, owns 33% of the company.

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1Unaudited

2 Resource life of mine is calculated by dividing the number of resource tonnes by the amount of ore forecast to be processed during the following 12 month period

3Unaudited figure

4Hochschild holds a 51% interest in San Jose and is the mine operator

5Production from the first nine months of 2010 has not been subtracted

 

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