Andean American alone at Invicta

Vancouver — Junior gold producer Andean American Mining (AAG-V, ANMCF-O) will advance its Invicta gold project, in west-central Peru, on its own, following notice that Barrick Gold (ABX-T, ABX-N) will not be exercising its back-in rights.

Barrick’s back-in option to purchase 51% was to be triggered upon the tabling of at least 2 million contained ounces gold in a measured and indicated resource estimate. Andean American’s recently completed technical report reviews just over 300,000 oz. gold contained in an indicated resource of 2.8 million tonnes grading 3.4 grams gold per tonne, 16.5 grams silver per tonne plus 0.4% copper, 0.5% lead and 0.4% zinc using a 1 gram gold cutoff. An additional inferred resource of 2.4 million tonnes at 2.8 grams gold, 37.4 grams silver and 1% copper was also tabled.

Since acquiring its option to purchase the project from Barrick in late 2005, Andean American has reviewed extensive past work. It re-logged and resampled several hundred sections of previous drill core to develop its resource estimate. Over 2 tonnes of samples were extracted for metallurgical testing. An infill drill program will be aimed at upgrading and qualifying resource blocks on the project identified in past programs.

The junior has launched engineering and environmental programs on planning a processing facility. Andean American envisions an open-pit operation and is targeting an initial production capacity of 800 tonnes per day in the first year, ramping up to as much as 3,000 tonnes per day by the fourth year.

Invicta mineralization appears low-sulphidation and is contained within an epithermal breccia environment. Veins, fracture filling and stockwork mineralization are present, with gold decreasing and base metals increasing with depth.

Andean American also operates the Santa Rosa mine, its small-scale gold operation in southern Peru. The mine began production in 2002 and had 2005 sales of over 17,600 oz. gold, plus some silver.

The company’s Sinchao project is located in northern Peru’s Yanacocha mining district. A recent technical study on the property reviewed four types of mineralization: a large copper-gold-zinc skarn, a copper-gold-silver fault-breccia zone, high-sulphidation epithermal copper-gold and a copper-gold-silver replacement zone with massive sulphides. The study reviewed the potential for several hundred million tonnes of mineralized material.

Andean American trades in a 52-week range of 60-$1.54.