VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - June 19, 2006) - Pacific Rim Mining Corp. (TSX:PMU)(AMEX:PMU) is very pleased to announce the results of an updated resource estimate for its El Dorado gold project, El Salvador. Highlights of the new resource estimate include:
- Total measured and indicated resources and proven and probable reserves at the El Dorado project of 1,222,000 million gold equivalent ounces, plus a further 115,000 gold equivalent inferred resource ounces.
- Indicated resources at the South Minita deposit of 350,000 gold equivalent ounces plus a further 77,000 gold equivalent inferred resource ounces.
The impetus for the updated resource estimate was primarily to quantify the gold and silver ounces at the South Minita deposit, the subject of an 18-month long definition drilling program at El Dorado that was recently completed. The resources below are tabulated using a gold equivalent, rather than a gold-only cutoff grade as was historically used at El Dorado, in order to more realistically represent the combined gold and silver aspects of these deposits. In the case of the Minita deposit, the estimate includes a small number of new recently drilled holes. The Coyotera and Nueva Esperanza deposits were re-tabulated using the gold-equivalent cutoff.
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El Dorado Project Resources (as of June 19, 2006)
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Gold Silver
Resource Grade Gold Grade Silver
Deposit Category Tonnes (g Au/t) Ounces (g Ag/t) Ounces
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South
Minita Indicated 1,070,900 9.25 318,400 63.99 2,203,000
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Inferred 302,800 7.20 70,100 48.23 470,000
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Minita Measured 614,100 12.23 241,500 80.59 1,591,200
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Indicated 1,175,100 9.65 364,400 58.16 2,197,300
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Total M&I 1,789,200 10.53 605,900 65.86 3,788,500
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Inferred 78,400 10.39 26,200 67.44 170,000
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Coyotera Measured 166,000 7.86 42,100 57.79 309,000
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Indicated 501,000 7.15 115,200 58.68 945,000
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Total M&I 667,000 7.34 157,300 58.48 1,254,000
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Inferred 19,000 5.83 3,600 72.12 44,000
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Nueva
Esperanza Indicated 183,000 5.77 33,900 30.47 179,000
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Inferred 29,000 4.67 4,300 35.49 33,000
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TOTAL
MEASURED &
INDICATED
ALL DEPOSITS 3,710,100 9.35 1,115,500 62.24 7,424,500
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TOTAL
INFERRED
ALL DEPOSITS 429,200 7.55 104,200 51.96 717,000
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Gold
Equivalent Gold
Resource Grade Equivalent
Deposit Category Tonnes (g AuEq/t) Ounces
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South Minita Indicated 1,070,900 10.16 349,900
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Inferred 302,800 7.89 76,800
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Minita Measured 614,100 13.39 264,300
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Indicated 1,175,100 10.47 395,700
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Total M&I 1,789,200 11.47 660,000
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Inferred 78,400 11.39 28,700
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Coyotera Measured 166,000 8.69 46,500
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Indicated 501,000 7.99 128,700
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Total M&I 667,000 8.17 175,200
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Inferred 19,000 6.86 4,200
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Nueva Esperanza Indicated 183,000 6.20 36,400
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Inferred 29,000 5.17 4,800
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TOTAL MEASURED
& INDICATED
ALL DEPOSITS 3,710,100 10.24 1,221,500
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TOTAL INFERRED
ALL DEPOSITS 429,200 8.30 114,500
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Notes:
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1) Resources based on a gold equivalent cut-off grade of
4.0 g AuEq/t
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2) Gold equivalents based upon a silver to gold ratio of 70:1
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3) The Minita resource is INCLUSIVE of the reserves stated below
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The resources above were estimated by interpreting drill intercepts in cross section, coding samples, capping assays, compositing to vein thicknesses, and estimating grades and thicknesses of each of the veins into a three dimensional grade thickness model. Each of the three veins at the Minita deposit and ten veins at the South Minita deposit were estimated separately. Readers are referred to the Regulatory Footnotes below for further NI 43-101 disclosure.
A portion of the Minita resources were converted to proven and probable reserves in a pre-feasibility study for the El Dorado deposit conducted in January 2005 (see news release #05-01 dated January 27, 2005 for details of the assumptions used in this reserve calculation, and NI 43-101 disclosure in the Regulatory Footnotes section below for further information). The following reserve table outlines that portion of the Minita resource which has been converted to reserves:
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El Dorado Project Proven & Probable Reserves (as of January 21, 2005)
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Gold
Equi-
Gold Silver valent Gold
Grade Grade Grade Equi-
Reserve (g Gold (g Silver (g valent
Category Tonnes Au/t) Ounces Ag/t) Ounces AuEq/t) Ounces
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Proven 711,949 10.09 230,908 68.30 1,563,425 11.06 253,242
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Probable 892,934 9.05 259,850 54.85 1,574,591 9.84 282,344
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Total 1,604,883 9.51 490,758 60.82 3,138,016 10.38 535,586
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Notes:
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1) El Dorado Project proven and probable reserves at 5 g/t
equivalent gold cut-off grade.
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2) Based upon US$350 gold and US$5.00/oz silver market price.
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3) Values shown in table are diluted and do account for mining
recovery.
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These reserves have been calculated in accordance with NI 43-101, which differs significantly from the requirements for reserve disclosure under U.S. Securities and Exchange Commission Industry Guide 7. Industry Guide 7 requires a "final" or "bankable" feasibility study to make reserve disclosure. The NI 43-101 Proven & Probable Reserves reported above are not considered reserves under U.S. Securities and Exchange Commission Industry Guide 7. Readers are referred to the Cautionary Note to U.S. Investors under "Regulatory Footnotes" below.
A full feasibility study based on the increased El Dorado resource estimate and including aspects of the mine plan outlined in the January 2005 pre-feasibility study has been initiated to investigate the economics of mining the El Dorado project at much higher throughput rates. Pacific Rim believes that the resource ounces outlined above will support an expanded El Dorado operation with annual gold production significantly higher than that envisioned in the January 2005 pre-feasibility study, while maintaining operating costs at or about $163 per ounce as estimated in the pre-feasibility study. The full feasibility study is expected to be completed in late 2006.
"Exceeding the million-ounce mark is a major milestone for Pacific Rim, and El Salvador, moving us another step forward in our goal of becoming a low-cost, intermediate-level gold producer," states Tom Shrake, President and CEO. "Our feasibility study, in which a larger operation will be designed, is now underway and expected before the end of the year. In the meantime, we will be deploying our drill rigs on an unmatched series of high-grade drill targets that we have developed over the past year within the El Dorado concessions; on the nearby bonanza-grade Santa Rita grassroots discovery; and the early stage projects of Zamora in western El Salvador and Colina in Southern Chile. All of these projects host epithermal, vein-type systems, with potential for low cost, high grade, environmentally benign gold deposits. Pacific Rim is now on a parallel course of developing a new million-ounce mine and looking to discover a second. Our all-star team is in place, our finances are solid and our future is bright."
About Pacific Rim Mining Corp.
Pacific Rim is a growth-oriented, revenue-generating, environmentally and socially responsible gold exploration company with operational and exploration assets in North, Central and South America. The Company is expanding and developing its advanced-stage, high grade, low cost El Dorado gold project in El Salvador and is actively exploring a pipeline of grassroots gold projects. Pacific Rim's goal is to become a low cost, intermediate level gold producer.
Regulatory Footnotes
The El Dorado resource estimate herein was prepared by Mr. Steve Ristorcelli, P.Geo. of Mine Develoment Associates, Reno, Nevada. Mr. Ristorcelli is an independent Qualified Person as defined in NI 43-101. The resource estimate conforms to current CIM Standards on Mineral Resources and Reserves. A technical report in support of the updated El Dorado resource estimate presented above will be filed with SEDAR on or before July 31, 2006. The report will be co-authored by Mr. Steve Ristorcelli, P.Geo. and Mr. Peter Ronning, P.Eng., both independent Qualified Persons as defined in NI 43-101.
The El Dorado pre-feasibility study, including the Minita deposit reserve estimate, is supported by a technical report prepared for Pacific Rim Mining Corp. by SRK Consulting (US) Inc. of Denver Colorado, entitled "Pre-Feasibility Study, El Dorado Project, El Salvador", dated January 21, 2005 and publicly available on SEDAR. The primary author of the report is Mr. William F. Tanaka, a Qualified Person independent of Pacific Rim, as defined in National Instrument 43-101. Mr. Tanaka is a member of the Society of Mining Engineers (SME) and the Australasian Institute of Mining and Metallurgy (mAUSIMM).
Pacific Rim's exploration work on the El Dorado project is supervised by William Gehlen a Certified Professional Geologist with the AIPG (No. 10626), an employee of Pacific Rim and a Qualified Person as defined in NI 43-101. Mr. Gehlen has verified that drill results have been accurately summarized from the official assay certificates provided to the Company. Pacific Rim's drill sampling procedures follow the Exploration Best Practices Guidelines outlined by the Mining Standards Task Force and adopted by The Toronto Stock Exchange. Samples have been assayed using fire assay with a gravimetric finish on a 30-gram split. Quality control measures, including check- and sample standard-assaying, are being implemented. Samples were assayed by Inspectorate America Corporation in Reno, Nevada USA, an ISO 9002 certified laboratory, independent of Pacific Rim Mining Corp.
The terms "measured resource", "indicated resource" and "inferred resource" used in this release are Canadian mining terms as defined in NI 43-101 and CIM Standards on Mineral Resources and Mineral Reserves. Mineral resources that are not mineral reserves have not been demonstrated to be economically and legally extractable. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. It should not be assumed that all or any part of a resource will ever be converted to a reserve. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred resources will be converted to measured and indicated resource categories through further drilling, or into mineral reserves once economic considerations are applied.
The term "bankable" in reference to a feasibility study is defined as a comprehensive analysis of a project's economics and is used by the banking industry for financing purposes.
Cautionary Note to U.S. Investors concerning estimates of resources and reserves: We advise U.S. Investors that while the terms "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource" are recognized and required to be reported by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize them. As such, information contained in this document concerning descriptions of mineralization and resources under Canadian standards may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements of the U.S. Securities and Exchange Commission. "Inferred mineral resources" have a great amount of uncertainty as to their existence and a great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of a "mineral resource" will ever be upgraded to a higher category. U.S. investors are cautioned not to assume that any part or all of an "inferred mineral resource" exists, or is economically or legally mineable. U.S. investors are also cautioned not to assume that any part or all of the mineral deposits in the "measured mineral resource" or "indicated mineral resource" categories will ever be converted into reserves.
"Mineral reserves" have been calculated in accordance with NI 43-101 as required by Canadian securities regulatory authorities. For United States reporting purposes, SEC Industry Guide 7 (as interpreted by the staff of the U.S. Securities and Exchange Commission) applies different standards for the disclosure of reserves. U.S. investors are cautioned that the reserves presented above, while in compliance with Canadian standards and regulations, do not meet the following requirements of reserve disclosure under U.S. Securities and Exchange Commission guidelines: the Minita reserves are based on a pre-feasibility level study (as allowed under Canadian regulations) rather than a "final" or "bankable" level feasibility study as required by the U.S. Securities and Exchange Commission; and, the Minita reserves are calculated using gold and silver prices of $350 and $5.00, respectively (the industry standard current at the time of the Minita reserve calculation), rather than the historic three year average prices required by the U.S. Securities and Exchange Commission (which as at January 21, 2005, the date of the Minita reserve calculation, would have been a $360.94 gold price and $5.38 silver price).
On behalf of the board of directors,
Thomas C. Shrake, President and CEO
This document contains forward-looking statements concerning the Company's plans for its properties, operations and other matters. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Statements concerning estimates of mineral resources and reserves may also be deemed to constitute forward-looking statements to the extent that they involve estimates of the mineralization that will be encountered if the property is developed, and in the case of mineral reserves, such statements reflect the conclusion based on certain assumptions that the mineral deposit can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance are not statements of historical fact and may be "forward-looking statements". Forward-looking statements are subject to a variety of risks and uncertainties, which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation:
- risks related to gold price and other commodity price fluctuations;
- risks and uncertainties relating to the interpretation of drill results, the geology, grade and continuity of mineral deposits;
- risks related to the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses;
- results of initial feasibility, prefeasibility and feasibility studies, and the possibility that future exploration, development or mining results will not be consistent with the Company's expectations;
- mining and development risks, including risks related to accidents, equipment breakdowns, labour disputes or other unanticipated difficulties with or interruptions in production;
- the potential for delays in exploration or development activities or the completion of feasibility studies;
- the uncertainty of profitability based upon the Company's history of losses;
- risks related to failure to obtain adequate financing on a timely basis and on acceptable terms;
- risks related to environmental regulation and liability;
- risks related to hedging activities;
- political and regulatory risks associated with mining and exploration; and
- other risks and uncertainties related to the Corporation's prospects, properties and business strategy.
Some of the important risks and uncertainties that could affect forward looking statements are described in the Company's regulatory filings, available on SEDAR (www.sedar.com). Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward looking statements. Forward looking statements are made based on management's beliefs, estimates and opinions on the date the statements are made and the Company undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change. Investors are cautioned against attributing undue certainty to forward-looking statements.
FOR FURTHER INFORMATION PLEASE CONTACT:
Pacific Rim Mining Corp.
Barbara Henderson
Toll Free: 1-888-775-7097 or (604) 689-1976
(604) 689-1978 (FAX)
info@pacrim-mining.com
www.pacrim-mining.com
