Minera Andes announces delivery of earn-in notice under option agreement at Los Azules Copper Project



    
    TSX: MAI
    NASD-OTCBB: MNEAF
    

    SPOKANE, WA, June 3 /CNW/ - Minera Andes Inc. (the "Corporation" or
"Minera Andes") (TSX: MAI and US OTC: MNEAF) is pleased to announce the
earn-in notice has been delivered to exercise its option to acquire a 100
percent interest in the Los Azules Copper Project (the "Project") located in
the San Juan Province of western central Argentina, subject to the right of
Xstrata Copper to back-in to the Project for a 51% interest. The notice was
delivered pursuant to the Los Azules Option Agreement between Minera Andes and
certain of its subsidiaries and Xstrata Copper, one of the commodity business
units within Xstrata plc (London Stock Exchange: XTA.L and Zurich Stock
Exchange: XTRZn.S), and its subsidiary, on the Project.
    By Minera Andes exercising its earn-in option on May 29, 2009, Xstrata
Copper has 90 days to notify Minera Andes whether it intends to exercise its
right to back-in to the Project for a 51% interest (the "Back-in Right") under
the Los Azules Option Agreement. After delivery of such back-in notice, in
order to complete the Back-in Right, Xstrata Copper must pay to a subsidiary
of Minera Andes within 90 days after delivery of such notice 300% of the
direct expenditures incurred by Minera Andes and its affiliates on the Project
area since November 25, 2005, and assume operational control and
responsibility of the Project within 120 days of such notice. Xstrata Copper
will also be required to produce a bankable feasibility study in conformity
with the standards set out in National Instrument 43-101 - Standards of
Disclosure for Mineral Projects, adopted by the Canadian Securities
Administrators ("NI 43-101") within 5 years of such notice.
    The Project area contains a copper deposit situated on adjoining
properties that straddle a large copper porphyry system, which was the subject
of a recent NI 43-101 technical report and scoping study containing an
inferred mineral resource estimate of 922 million tonnes of 0.55 % copper. The
deposit as currently defined is open in several directions, and further
drilling will be required to fully define the limits of the mineralization,
especially along the strike to the north and at depth where many of the drill
holes have bottomed in copper mineralization.

    Los Azules Option Agreement Details

    The Project is an exploration project comprised of properties owned by
Andes Corporacion Minera S.A. ("Andes"), an indirect wholly-owned subsidiary
of Minera Andes (the "Andes Properties") and adjoining properties held by MIM
Argentina Exploraciones S.A. for Xstrata Copper ("MIM" and the "MIM
Properties"). The Project is subject to the Los Azules Option Agreement dated
November 2, 2007, as amended. Under the Los Azules Option Agreement, Los
Azules Mining Inc. ("LAMI"), a indirect subsidiary of Minera Andes, has earned
a 100% interest in the MIM Properties and MIM is now required under the terms
of the Los Azules Option Agreement, to transfer the MIM Properties to Andes
which Andes will hold together with the Andes Properties (the "Combined
Property").
    Certain of the MIM Properties are subject to an underlying option
agreement, which is the subject of a dispute between Xstrata Copper, as option
holder, and Solitario Argentina S.A. ("Solitario"), as the grantor of that
option and the holder of a back-in right of up to 25%, exercisable upon the
satisfaction of certain conditions, within 36 months after the exercise of the
option by Xstrata Copper. The dispute surrounds the validity of a 36 month
restriction on a back-in-right held by Solitario.

    About Minera Andes

    Minera Andes is a gold, silver and copper exploration company working in
Argentina. The Company holds about 304,000 acres of mineral exploration land
in Argentina. The producing San José silver/gold mine is 49% owned by Minera
Andes through a joint venture. Minera Andes is also exploring the Los Azules
copper project in San Juan province, where an exploration program has defined
a resource and a scoping study has been completed. Other exploration
properties, primarily silver and gold, are being evaluated in southern
Argentina. The Corporation presently has 230,538,851 shares issued and
outstanding.

    This news is submitted by Allen V. Ambrose, President and Director of
Minera Andes Inc.

    Caution Concerning Forward-Looking Statements:

    This news release contains forward-looking statements and forward-looking
information within the meaning of applicable US and Canadian securities laws.
Such forward-looking statements or information include, but are not limited
to, statements or information with respect to the price of gold, silver,
copper and other base metals, operating and capital costs, production
estimates, and estimation of mineral reserves.
    In making the forward-looking statements and providing the
forward-looking information, we have made numerous assumptions. These
assumptions include among other things, assumptions about the price of gold,
silver, copper, anticipated costs and expenditures, future production and
recovery and that there is no unanticipated fluctuation in interest rates and
foreign exchange rates. Although our management believes that the assumptions
made and the expectations represented by such statements or information are
reasonable, there can be no assurance that the forward-looking statements will
prove to be accurate. Forward-looking statements and information involve known
and unknown risks, uncertainties and other factors that may cause our actual
results, to be materially different from that expressed or implied by such
forward-looking information. Such risks, uncertainties and other factors
include among other things, declines in the price of gold, silver, copper and
other base metals, the outcome of the Solitario Claim, capital and operating
cost increases, changes in general economic and business conditions, including
changes in interest rates and the demand for base metals, economic and
political instability in Argentina, discrepancies between actual and estimated
production and mineral reserves and resources; operational and development
risk; the speculative nature of mineral exploration and regulatory risks.
    Readers should not place undue reliance on forward-looking statements or
information. We undertake no obligation to reissue or update forward-looking
statements or information as a result of new information or events after the
date hereof except as may be required by law. See our annual information form
for additional information on risks, uncertainties and other factors relating
to the forward-looking statements and information. All forward-looking
statements and information made in this news release are qualified by this
cautionary statement.

    Cautionary Note to U.S. Investors:

    The United States Securities and Exchange Commission (the "SEC") permits
mining companies, in their filings with the SEC, to disclose only those
mineral deposits with "mineral reserves" that a company can economically and
legally extract or produce. We use certain terms in this news release, such as
"mineral resources", that the SEC guidelines strictly prohibit us from
including in our filings with the SEC, because these terms are common usage in
Canada and form part of our Canadian filing requirements. U.S. Investors are
urged to consider closely the disclosure in our Form File No. 40F, which may
be secured from us, or from the SEC's website at
http://www.sec.gov/edgar.shtml.




For further information:

For further information: Art Johnson at the Spokane office, or Krister
A. Kottmeier, investor relations - Canada, at the Vancouver office. Visit our
Web site: www.minandes.com. Spokane Office, 111 East Magnesium Road; Ste. A,
Spokane, WA, 99208, USA, Phone: (509) 921-7322, E-mail: info@minandes.com;
Vancouver Office, 911-470 Granville Street, Vancouver, B.C., V6C 1V5, Phone:
(604) 689-7017, (877) 689-7018, E-mail: ircanada@minandes.com

Organization Profile

MINERA ANDES INC.

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