Diablito Project Update

4 Mar 2005 07:00

Vane Minerals PLC04 March 2005 VANE Minerals plc Full Production Expected At Diablito Three Months Ahead Of Schedule Vane Minerals ("VANE" or "the Company") announces that it has signed anagreement with a mining contractor to develop its most advanced project,Diablito, a high grade gold/silver deposit located in west-central Mexico. VANE's wholly owned subsidiary Minerales Vane SA de CV has signed the agreementwith MGA Constratista Minera SA de CV in San Luis Potosi, Mexico, stating thatwork at the Company's Diablito property will commence in 15 days. The contractor had sent the required machinery to the property, ahead of thesigning of the contract, and so work should commence on time and full productionwill be achieved three months ahead of schedule. Following the development plan that VANE has created, Diablito is expected toproduce ore within three weeks of the work commencing. The Company hadoriginally planned to begin at a lower rate and ramp up production to 50 tonsper day over a three month period. However, the new development plan is expectedto allow the mine to start producing at the full production rate of 50 tons perday. At this target rate, VANE has estimated an annual pre tax profit from Diablitoof US$3m, or US$250,000 per month, with a mine life of seven years given thepresent resource calculation. As previously announced on 25th October 2004, thevein is open at depth, and an infill drilling programme is planned in order toextend the resource. Michael Spriggs, Chairman of VANE commented, "We are very pleased with thisprogress at Diablito, and delighted to be achieving full production quicker thanpreviously expected. With the cash flow, we are well on our way to achievingVANE's objective of becoming a self-funding exploration company, thereforelimiting the downside to our shareholders." Enquiries: VANE Minerals plc Seymour Pierce Limited Parkgreen CommunicationsMatthew Idiens Sarah Wharry Justine Howarth / Cathy Malins020 7667 6322 020 7107 8000 020 7493 3713 This information is provided by RNS The company news service from the London Stock Exchange