Coeur D’Alene To Open Mexican Mine

was less than a year ago that Coeur d’Alene Mines ( cdm-T,CDE-N)OPENED its massive San Bartolome silver mine in the Bolivian Andes. Now the company is poised to open a second major one: the Palmarejo silver mine in Mexico. At

presstime, Palmarejo was on track to pour its first dor before the end of March and the mine is expected to produce 5.3 million oz. silver and 72,000 oz. gold before the end of the year. Production in 2010 is forecast at roughly 7.4 million oz. silver and 92,000 oz. gold. “

Theconstruction has gone very well, there haven’t been any major delays or difficulties,” says Tony Ebersole, Coeur d’Alene’s director of corporate communications. ” Mexicohas a strong mining tradition and the workers generally have a lot of experience; they’ve been a big part of this.” Coeur

d’Alene acquired the property at the very end of 2007 and will spend a total of US$ 444million on mine construction. “

Therehad been some development ( onthe property before we acquired it) so we went full bore and it’s been a little bit over a year of construction,” Ebersole says. ” Therehad been some early construction — about US$ 50million had been put into it in terms of construction — but it has been transformed since then.” Situated

in the Sierra Madre mountains of Chihuahua state, Palmajero will have the capacity to produce an average of about 120,000 oz. gold and 9 million oz. silver a year over an 11-yearlifespan. At

the end of the year, Palmarejo’s reserves reached 63.6 million oz. silver and 2.3 million oz. gold, with another 53.3 million oz. silver and 676,000 oz. gold in measured and indicated resources. The property has an additional 58.5 million oz. silver and 880,000 oz. gold in inferred resources. Palmarejo

has proven reserves of 6.8 million tons at 5.09 oz. silver per ton and 0.06 oz. gold per ton. plus probable reserves of 5.4 million tons at 5.37 oz. silver and 0.07 oz. gold. Measure and indicated resources stand at about 15.3 million tons at 3.5 oz. silver and 0.04 oz. gold. Last

year, Coeur spent more than US$ 8million on exploration at Palmarejo and expects to invest another US$ 8.2million this year. Recent

exploration at Palmarejo concentrated on expanding and defining the district’s second large silver and gold deposit, named Guadalupe, 6 km from Palmarejo. Late

last year, Coeur signed an option agreement to acquire 100% of the La Currita property, which borders Guadalupe on the southeast. The

company has started drilling at La Currita and has planned an initial program of 8,000 metres. Outside

Mexico, Coeur d’Alene owns and operates underground mines in southern Chile and Argentina and one open-pitmine in Nevada. In addition, it owns nonoperating interests in two low-costmines in Australia as well as the Kensington gold project in Alaska. In

terms of ounces in the ground, Coeur d’Alene leads the primary silver producers with proven and See probable reserves of 248 million oz. silver and 2.3 million oz. gold.

Financial results for the year ended Dec. 31, demonstrated the company is well capitalized with liquidity of about US$100 million as of Jan. 31, 2009, and capex remaining for the year of about US$65 million.

The company has debt of US$410 million.

This year, US$17.6 million has been earmarked for exploration, of which about 85% will be used for expanding producing mines.

The full budget for exploration in Mexico is US$8.2 million, of which more than 90% will be devoted to the Palmarejo district including La Currita.

The company, based in Coeur d’Alene, Idaho, trades at about 83¢ per share on the TSX. It has traded in a 52-week window of 50¢-$4.83 and has 610.6 million shares outstanding.

In New York, the company trades at about US62¢ per share and has a 52-week trading range of US36¢- US$4.65 per share.