Minefinders advances Dolores (January 13, 2004)

Vancouver The long awaited feasibility study for the Dolores gold-silver project is a step closer to fruition now that Minefinders (MFL-T) has completed 59,384 metres of delineation drilling on the Mexican property.

Based on the results, the junior is aiming to have an updated resource estimate in hand before the end of the first quarter. The new resource will be incorporated in the Dolores feasibility study, which was originally set for completion in late 2003.

Last year, engineering firm of Pincock, Allen, & Holt (PAH) verified that Dolores held an overall resource of 72.74 million tonnes grading 1.27 grams gold and 60 grams silver, using a 0.6 gram gold cut off. Some 50.8 million tonnes grading 1.26 grams gold and 61.4 grams silver lie in the measured and indicated category.

The property has a long mining history with placer operations beginning in the 1860’s. By 1898 hard rock mining got under way and with a power line being installed from Madera, Chihuahua State in 1915, processing progress to a 25 stamp mill using a cyanide leach and zinc precipitate circuit. Most of the production came from underground stope mining operations developed along three main, subparallel structures. The mill was destroyed by a fire in 1929, essentially stopping production.

Exploration activity took hold in the 1990’s with a total of 510 holes totalling 113,284 metres drilled on the Dolores project since 1996.

The latest drill results indicate the potential of mining additional gold by underground methods beneath the current open pit mine plan. Hole 193, the deepest hole completed on the property and some 100 metres below the proposed bottom of the open pit, cut 34 metres grading 5 grams gold per tonne, including a 1 metre section running 119.9 grams gold and 227.5 grams silver.

The higher grade shoots have been intercepted throughout the Dolores deposit, with good continuity, extending from the surface to more than 600 metres deep and 200 metres below the previously-announced block modeled resource.

The latest highlights include hole 260, which yielded 6.7 metres grading 10.92 grams gold and 135.7 grams silver, hole 266, which returned several intercept ranging up to 15.35 grams gold and 22 grams silver over 10 metres, and hole 269, which returned 94 metres grading 1.27 grams gold.

So far, the deep drilling holds the potential to add up to 500,000 oz of gold to the overall resource. However, more deep drilling is required to determine the economics of an underground operation.

Once Minefinders completes the open pit feasibility study, a scoping study will be launched to evaluate the potential of developing and mining underground concurrently with the open pit operation.

Engineering consultants have been working on the Dolores feasibility study since Feb of last year. with McClelland Labs, Hazen Research and SGS Lakefield Research completing the final metallurgical studies for the project. Tests include additional column leaching, bottle rolls, and all necessary hardness, abrasion, and mill work index tests required for final mine design and costing. Initial results suggest that flotation is expected to increase significantly overall recoveries, especially of silver.

Golder Associates have completed initial rock mechanic and pit slope stability studies for the pit design and tailings dam, leach pad, stockpiles and plant site facilities, and their results will be incorporated into the final feasibility study.

Roscoe Postle Associates are working on the mineral resource estimate for the Dolores deposit and M3 Engineering & Technology has been working on the feasibility study since Feb.

Final environmental surveys and preparation of the Environmental Impact Study (EIS) were initiated in November and are expected to be completed in the second quarter of 2004.

Located in northern Chihuahua State, the wholly-owned project is slated for development in 2004.

Minefinders is set to resume drilling later this month with three rigs drilling both step out holes and new targets.