Arian confirms gold, copper resource at Tepal (March 31, 2008)

VANCOUVER — A recent resource estimate for Arian Silver’s (AGQ-V, AGQ-L) Tepal porphyry project in Mexico confirms historic estimates and adds more than 1 million contained ounces gold plus considerable copper.

The study reviews 78.8 million inferred tonnes of oxide material grading 0.47 gram gold (1.18 million contained ounces) and 0.24% copper (422 million contained pounds) plus silver values contained in the North and South zones. The inferred resource is based on 31 historic diamond-drill holes plus 23 completed by Arian.

Tepal is a copper-gold porphyry system with mineralization primarily hosted in disseminated and stockwork copper sulphides (oxidized up to 40 metres depth in sections) occurring along a line of small tonalite intrusives exhibiting multiple phases and breccia structures. A thin zone of supergene enrichment is noted in sections.

The project, in Michoacan state, was previously explored in the 1970s and 1990s by several companies, including Inco (now part of Vale [RIO-N]), Teck Cominco (TCK. B-T, TCK-N) predecessor company Teck and Hecla Mining (HL-N).

Arian says it has completed another 15 holes, not included in its resource estimate, that were collared within or near its currently delineated North and South zones. It recently began another round of drilling at Tepal, with plans to complete about 7,500 metres.

The Mexican-focused junior is earning a 100% interest in the project for total payments of US$5 million over five years. The vendor, Minera Tepal, retains a 2.5% net smelter return (NSR) royalty on the project.

Arian also recently posted an initial resource estimate for its San Jose silver project, in Zacatecas state. The study pegs inferred resources at roughly 8.4 million tonnes (within four blocks) averaging 102.8 grams silver per tonne, 0.25% lead and 0.8% zinc — for a contained metal tally of 27.7 million oz. silver, 65 million lbs. lead and 148 million lbs. zinc.

The estimate is based on 31 holes (totalling 4,500 metres) on four resource blocks covering roughly 1,600 metres of combined strike along the company’s 12.5-km section of the San Jose vein system. Drilling tested to about 200 metres depth.

Mineralization is hosted in a lowto-intermediate sulphidation epithermal environment within the San Jose vein system.

Arian acquired its option for 100% of the project in 2006. Under the agreement, it will pay US$1.5 million over three years with the vendor retaining a 2% NSR.

The San Jose project includes a previously operated mine run by a subsidiary of Minera Penoles from 1973-1991 and by De Sarrollo Monarca from 1993-2001. More than 2 million tonnes of ore averaging about 250 grams silver plus base metal values was extracted from underground workings.

Arian aims to rehabilitate and resume operations at San Jose by early next year using existing infrastructure, including a development ramp that extends about 3 km along the San Jose vein, plus a 500-tonne-per-day capacity vertical shaft sunk to 300 metres depth on the vein.

Arian shares have recently traded at around 43, giving the company a $54-million market capitalization based on its 125 million shares outstanding. The stock has a 52-week trading range of 32-73.