MIRL.L Regulatory News (MIRL)

23 May 2007 14:00

Minera IRL Limited23 May 2007 For immediate release: 23 May 2007 Minera IRL Limited Press Release Minera IRL Limited commences Construction of the Corihuarmi Gold Mine, Peru LONDON: 23 May 2007 - Minera IRL Limited ("MIRL" or the "Company" - AIM codeMIRL), is pleased to announce that construction has commenced at its CorihuarmiGold project only one month after listing on the AIM market. Corihuarmi islocated approximately 160km south east of Lima, Peru. Peru based engineering company Buenaventura Ingenieros SA ("BISA"), inconjunction with Vector Engineering, have been appointed as the EPCM contractorto construct and commission the project. The contract has been signed, andmobilisation and site construction has recently commenced. Since 2002 MIRL has drilled Corihuarmi, carried out feasibility andenvironmental studies as well as having obtained surface rights agreements andpermits required to immediately commence construction. Commissioning of themine is expected in Q4 2007 and initial gold production from the heap leachproject is scheduled for the first quarter of 2008. Over 35,000 ounces of gold production is anticipated for 2008 and over 110,000ounces during the 4 year mine life based upon current mineable reserves.Upgrading of identified resources to reserves and follow-up of encouragingexploration indicators within the 9,000 ha tenement package has the potential tosignificantly extend the mine life. The board has approved the capital appropriation of US$16.6 million for theconstruction, based on detailed engineering design and in consultation with theappointed contractors. Of this US$2.6 million will be reimbursed onceproduction commences as a credit on value added tax resulting in a net capitalcost of US$14.0 million. The capital will be financed from funds currentlyavailable to the Company from the recent IPO listing. Economic studies indicate a robust project which is expected to generate strongcash flow. Based upon a gold price of US$600/oz, the capital payback period isforecast to be 18 months. Commenting on this development, Chairman and CEO Courtney Chamberlain said: "Thecommencement of construction of the Corihuarmi project is a significantachievement for the Company in moving into the ranks of a mining company. Thestrong cashflow will be applied to the advancement toward production of otherprojects in the pipeline." For more information contact: Minera IRL + 61 408 888 803Courtney Chamberlain, Executive Chairman Arbuthnot Securities + 44 (0)20 7012 2000Graham SwindellsPaul Vanstone Bankside Consultants + 44 (0)20 7367 8888Simon RothschildLouise Mason This information is provided by RNS The company news service from the London Stock Exchange