Andean American cuts high-grade gold-copper at Invicta

Vancouver – Andean American Mining (AAG-V, ANMCF-O) got a modest market boost following assays from drill hole AE-DDH-07-30 that cut significant intervals of high-grade gold and copper at the Invicta project in west-central Peru.

An intercept of 14.25 metres (from 146 metres downhole depth) averaged 18.45 grams gold per tonne, 18 grams silver per tonne and 0.46% copper in porphyritic medium-grained andesite with a brecciated structure cemented by multiple quartz veins. An 18.5-metre interval (from 159.2 metres depth) graded 2.87% copper, 2.1 grams gold and 56.1 grams silver.

Up to 40% sulphides are reported in the mineralized sections of the core, as blebs of pyrite and chalcopyrite, along with strong hematite alteration.

Andean American feels the distinct zones of gold and copper suggest two potentially separate mineralizing events.

The infill hole was collared on the Atenea vein where at least 3,500 metres of drilling is planned to provide data for a resource upgrade program. Additionally, about 7,200 metres of drilling on the Ydalia vein and zones 4, 5, 7, Azulmina and Manuel structures is also scheduled.

With production aspirations at Invicta, Andean American has also undertaken a 150-tonne metallurgical sample program plus the development of a 600-metre long, 3-by-3 metre exploration adit being driven at 3,400 metres. The adit can be enlarged to 4.2 metres by 4.5 metres for exploitation purposes.

A measured and indicated resource of 4.8 million tonnes grading 3.58 grams gold, 33.46 grams silver and 0.68% copper was tabled for the project in late 2006. An additional 8.3 million inferred tonnes of 2.14 grams gold, 15.1 grams silver and 0.47% copper was also reviewed.

The company has development goal for Invicta looking at building a minimum 7-year mine life, starting with two years of high-grade production. A phased, 3,000-tonne per-day mill complex has been modeled with projections for payback in less than three years; however a feasibility study still needs to be conducted on the project.

Andean American acquired its option on the advanced, prefeasibility-stage project from a Barrick Gold (ABX-T, ABX-N) subsidiary in late 2005. It can acquire 100% interest for cash and shares totaling US$700,000 paid in the first year, followed by annual advanced royalty payments of US$100,000 to Barrick upon exercising its option plus a lump sum payment of US$800,000 on commencement of production. Barrick retains a 1% NSR, capped at US$1 million, and a back-in right for up to 51% interest should Andean American delineate more than 2 million contained oz. gold in proven and probable reserves.

Mineralization at Invicta occurs in an epithermal breccia environment within volcanic and intrusive assemblages, and is hosted in veins, fracture fillings and stockworks. The deposit shows a metal zonation with gold decreasing and base metals increasing with depth.

In addition to Invicta, Andean American is working to solve metallurgical issues at its Santa Rosa gold-silver mine in southern Peru. It also holds 74% of Sinchao Metals (SMZ-V) that is exploring the Sinchao gold-silver-copper project in northern Peru’s Cajamarca province.

Shares of Andean closed up a nickel at 58 apiece on the July 24th drill results. The companys stock has a 52-week trading range of 48.5-$1.10.