Pan American Silver Corp. (PAAS)

[NYBob]

PanAm’s San Vicente silver mine expansion will yield 2.8m ounces yearly

One of the world’s largest primary silver miners,
Pan American Silver, Wednesday cast its vote for the future
of Bolivian mining by announcing it build a US$40.5 million
expansion at its San Vicente operation.
Author: Dorothy Kosich
Posted: Thursday , 07 Jun 2007

RENO, NV -

Vancouver-based silver miner Pan American Silver
Wednesday said it will expand production at its
San Vicente silver-zinc mine in the Potosí Department
of Bolivia.

To expand production at San Vicente,
Pan American
(NASDAQ: PAAS, TSX: PAA) has purchased the 40% interest
of Empresa Minera Unificada S.A. in
Pan American Silver (Bolivia) S.A.
for $9 million and a 2% net smelter royalty.

Pan American estimates that--once the US$40.5 million expansion
is complete and the mine is operating at capacity - -
San Vicente will produce 2.8 million ounces of silver
yearly at an average cost of less than $2/oz,
net of zinc byproduct credits, during the first five years
of the operation.
The project is estimated to take 18-20 months to complete.

In a statement, Geoff Burns, President and CEO of
Pan American, said, "The long mine life, low cast costs
and exploration potential combined to make the expansion
an extremely attractive investment.
It is rewarding to be able to add significant organic
growth to our production profile for such a modest
capital investment."
The project includes underground mine development
and construction of a new 750tpd processing facility.
With the expansion, San Vicente is anticipated to have
a 13-year mine life.

As of December 31, 2006, San Vicente was estimated to
have 18.82 million ounces of contained silver.
A technical report for the project will be made public
in 45 days.

Meanwhile, Pan American will seek approval for
Bolivia state mining company Comibol to continue its
toll milling agreement at the nearby
Chilcobija mill facility while the new
San Vicente mill is being built.
San Vicente was operated by Comibol from 1972 until 1993
when mining was suspended, pending privatization.
Pan American optioned the San Vicente project from Comibol
in 1999 and became its operator.

A primary silver producer,
Pan American manages eight silver operations,
and has forecast 2008 silver production of 25 million ounces.

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