Andina boosts Volcan gold resource (October 25, 2007)

Vancouver – Almost 15,000 metres of additional drilling by Andina Minerals (ADM-V, ADMNF-O) at its Volcan project in Chile’s Maricunga gold belt has resulted in a significant resource increase.

Measured and indicated resources are up 48% from an early-2007 estimate to 115.1 million tonnes grading 0.79 gram gold per tonne (2.93 million contained oz.) using a 0.5 gram gold cut-off. An additional 170.3 million inferred tonnes of 0.77 gram gold (4.2 million contained oz.) was also tallied using the same cut-off.

Andina points out higher-grade core zones hosting 61.7 million measured and indicated tonnes at 0.97 gram gold (1.92 million contained oz.) using a 0.7 gram gold cut-off along with a further 83.1 million inferred tonnes of 0.96 gram gold (2.55 million contained oz.).

The company attributes most of the resource boost to the northward extension of its Dorado West zone where it is traced over widths of up to 600 metres. Infill drilling on the zone resulted in the measured resource category.

Dorado West, which hosts more than two-thirds of the current resource base, extends along strike for about 1,500 metres and remains open to the north.

“The resource increase significantly enhances the viability of the Volcan project and underpins our confidence that this is a much larger mineralization system than initially anticipated when we began our exploration in 2005,” stated Andina president and CEO Carl Hansen in the release.

Hanson also tabled his optimism the company’s upcoming $15.5-million, 50,000-metre drill program at Volcan will further expand the resource base.

Gold and copper mineralization at Volcan is associated with a hydrothermal alteration system related to a sub-volcanic porphyry intrusive and flow complex. The gold typically occurs in banded quartz veinlets within the altered volcanic flows.

Native sulphur deposits on the project area were historically mined. In the late-1980s the Chilean Government tabled a reserve estimate of about 4.7 million tonnes grading 40% sulphur.

Both Homestake, now part of Barrick Gold (ABX-T, ABX-N), and Cambior, recently merged into Iamgold (IMG-T, IAG-N), conducted modest exploration programs on Volcan in the 1990s.

Shares of Andina gained about 10% on the new Volcan resource estimate, rising to the $4.60-level.