Miramar grows Hope Bay resource (April 21, 2006)

Vancouver – A significant resource increase at its Hope Bay gold project, in Nunavut, has Miramar Mining (MAE-T, MNG-X) pumped up on possible expanded development of the deposits.

The company has added more than one million contained oz. of gold to its Madrid deposit resource, using the same cut-off grades as in 2004, where it is also examining the potential of a large open pit operation. Modeling of a bulk mining scenario has changed reporting parameters of the Madrid resource, leading to an increase of over 2.6 million oz. of gold due to lower cut-off grades. Drilling in 2005 extended the Naartok East and West zones at Madrid, which comprise most of the resource boost.

Last year’s infill drilling has resulted in an updated indicated resource of 14.2 million tonnes grading 4.5 grams gold per tonne at Madrid, equating to about 2 million oz. of contained gold, using a 2 gram gold cut-off grade. An additional 29.7 million inferred tonnes at 4.1 grams gold was also reviewed at the same cut-off grade, containing 3.9 million oz.

Overall indicated resources for the Hope Bay project (comprised of the Boston, Doris and Madrid deposits) now stand at 17.9 million tonnes grading 6.3 grams gold (3.55 million oz. contained). An additional inferred resource of 36.7 million tonnes at 5.4 grams gold in the three deposits adds a further 5.5 million contained oz. of gold. Reported 2005 resources are up over 40% from the prior year.

With aspirations to become an intermediate gold producer, Miramar plans a multi-phase development plan for Hope Bay. Phase one will comprise placing the small scale Doris North mine into operation. Doris North is a near-surface zone of high-grade gold bearing quartz veins. The total Doris deposit contains a measured and indicated resource of 763,000 tonnes grading 23.9 grams gold per tonne, plus additional inferred resources of 1.7 million tonnes of 14.7 grams gold. Doris North is scheduled to produce about 155,000 oz. of gold annually over two years.

Larger, second phase development plans reviewed by Miramar include the Doris Central, upper Boston and western Madrid deposits. Higher grade feed would be likely blended with bulk tonnage material from Madrid.

This year’s $30 million work program at Hope Bay has the company focused on completing its feasibility study for the Phase Two plans. Modeling of a large pit at Madrid, in lieu of previously planned underground operations, could alter the phased development plan and have the project move directly into large scale production following Doris North. Miramar anticipates a firmer development plan by the end of 2006 upon completion of the feasibility study.

The original Phase Two plan (Doris Central and upper zones of Madrid and Boston) foresees possible annual production of 250,000-to-300,000 oz. of gold. This year’s drilling on the northern portion of the Madrid deposit will determine whether it could support the Large Pit Complex option and feasibly produce 500,000-to-750,000 oz. annually.

Earlier this year, the Nunavut Impact Review Board approved Miramar’s revised environmental impact statement for the initial development of Doris North. The company anticipates starting to ship equipment to Hope Bay in the summer of 2007 and envisions production commencing in 2008.

With its 186 million shares outstanding, Miramar posts an $800-million market capitalization at its recent $4.30 per share trading level.