Silver Standard and Esperanza boost San Luis resource

Vancouver – For Silver Standard Resources (SSO-T) and Esperanza Silver (EPZ-V), joint-venture partners at the San Luis gold and silver project in northern Peru, putting a November 2007 resource estimate back on the drawing board has paid off.

The updated resource estimate appears to vindicate Esperanza’s suspicion announced in May of this year that the 2007 estimate understated the project’s potential.

Both the mineralization’s size and grade got a boost. San Luis now comes in at 484,000 measured and indicated tonnes grading 22.3 grams gold per tonne and 578 grams silver per tonne for 347,000 oz. contained gold and 9 million oz. contained silver.

That translates into increases of 31% for contained gold and 26% for contained silver.

The latest resource estimate uses a 6-gram gold-equivalent as the cut-off grade, a change from the November 2007 resource estimate which used a 40-gram silver-equivalent cut-off grade.

Esperanza vice president and chief geologist Paul Bartos says the 6-gram gold-equivalent cut-off is “more realistic” for what would be a predominantly bonanza-grade underground operation at San Luis.

He says when he saw the November 2007 resource estimate released by Silver Standard he scratched his head at the use of the 40-gram silver-equivalent cut-off.

“You know, I don’t have a good reason for it,” he says.

Nonetheless the resource estimate still gets a substantial boost at the 40-gram silver-equivalent cut-off, increasing 38% for both gold and silver to 265,000 measured and indicated oz. gold and 7.1 million measured and indicated oz. silver.

Going forward Esperanza says to expect a feasibility study mid-2009 and an environmental impact study before 2010.

As it stands Silver Standard operates the project with a 55% interest. Esperanza holds the remaining 45%. Silver Standard can increase its interest to 80% if it gets San Luis production ready.

Bartos says that as Peru is entering the rainy-season the joint-venture doesn’t plan on drilling the property for about the next six months.

On news of the resource update Esperanza’s share price gained 1¢ to close at 50¢. Silver Standard ended the day up 15¢ to close at $11.16.