Yamana Resource Updates for La Pepa, Jeronimo and Amancaya



    
    TSX: YRI
    NYSE:   AUY
    LSE: YAU
    

    TORONTO, July 24 /CNW/ - YAMANA GOLD INC. (TSX:YRI)(NYSE:  AUY)(LSE:YAU)
today announced resource estimates and updates for La Pepa, Jeronimo and
Amancaya.

    La Pepa, Chile

    The La Pepa project is located in Chile's prolific Maricunga gold belt.
The project is comprised of several deposits and areas. Although drilling and
evaluation of the entire project continues, the Company has now completed its
first resource estimate of the Cavancha area of the project. This resource
estimate was prepared based on reverse circulation and diamond drilling, with
a total of 107 drill holes (92 reverse circulation and 15 diamond drills)
having been completed. In addition, 10 surface trenches have been completed
utilizing an ordinary kriging method.
    Measured and Indicated Resources are estimated at 1.985 million contained
ounces of gold. Inferred Resources add an additional 561,000 contained ounces
of gold (28.1 million tonnes grading 0.62 g/t). For the purpose of the
foregoing mineral resource, a cut-off grade of 0.5 g/t has been used. The
table below estimates the mineral resources at various cut-off grades.

    
    -------------------------------------------------------------------------
                       MEASURED                       INDICATED
    Cut-off -----------------------------------------------------------------
    (g/t) Au    Tonnes   Au(g/t)    Au (oz)       Tonnes  Au(g/t)     Au (oz)
    -------------------------------------------------------------------------
    0.3     15,590,000     0.60    301,000   148,016,000    0.56    2,665,000
    0.4     12,187,000     0.68    266,000   112,062,000    0.63    2,270,000
    0.5      8,887,000     0.76    217,000    78,575,000    0.70    1,768,000
    0.6      6,364,000     0.84    172,700    51,069,000    0.78    1,284,000
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                 MEASURED AND INDICATED                INFERRED
    Cut-off -----------------------------------------------------------------
    (g/t) Au    Tonnes   Au(g/t)    Au (oz)       Tonnes  Au(g/t)     Au (oz)
    -------------------------------------------------------------------------
    0.3    163,606,000     0.56  2,966,000    75,956,000    0.48   1,172,000
    0.4    124,249,000     0.63  2,536,000    52,092,000    0.54     904,000
    0.5     87,462,000     0.71  1,985,000    28,131,000    0.62     561,000
    0.6     57,433,000     0.79  1,456,000    13,500,000    0.72     312,000
    -------------------------------------------------------------------------
    

    The La Pepa project is within the vicinity of other comparable deposits
that are more advanced and larger in size and scale. Based on these
encouraging results, the Company is continuing its exploration efforts in
order to increase contained ounces (tonnage and grade) and further evaluate
the feasibility of the project.
    In that regard, metallurgical testwork continues. The work completed to
date includes bottle roll tests for oxidized and unoxidized ore. Additional
metallurgical testwork includes column leach tests for crushed and run of mine
ore. Metallurgical recoveries are estimated at an average of 70% based on work
completed to date, although further testwork is required.
    The mineralization is confined to an area of moderate to strong quartz
veinlets with disseminated pyrite in argillic, advanced argillic and phyllic
alteration zone that measures approximately 400 metres by 500 metres in
surface and extends to a depth of at least 600 metres below surface. The
alteration and mineralization are emplaced in a sub-horizontal sequence of
porphyritic dacites flows and breccias that have been intruded by a later
sequence of rhyolites and related volcanic breccias. A zone of surface
oxidation of approximately 30 to 40 metres in thickness covers a much larger
unoxidized deposit.

    Jeronimo, Chile

    Yamana holds a 57% controlling and operating interest in the Jeronimo
project along with its joint venture partner, Corporacion Nacional del Cobre
de Chile (Codelco), who holds the remaining 43%. Jeronimo is located in Region
II of northern Chile. The Company completed an update to the resource estimate
for this project.
    Indicated resources for the Jeronimo project are estimated at 627,000
contained ounces of gold (3.88 million tonnes grading 5.02 g/t). Inferred
resources for the Jeronimo project add an additional 1.53 million contained
ounces of gold (11.7 million tonnes grading 4.07 g/t). For the purpose of this
mineral resource, a cut-off grade of 2.0 g/t has been used. The table below
estimates the mineral resources at various cut-off grades.

    
    -------------------------------------------------------------------------
                                  INDICATED
    -------------------------------------------------------------------------
    Zone                 Upper                         Inter Fault
    -------------------------------------------------------------------------
    Cut-off                 Au                               Au           Au
    (g/t) Au    Tonnes     (g/t)    Au (oz)       Tonnes    (g/t)        (oz)
    -------------------------------------------------------------------------
    2.0      3,585,000     5.06    583,000       181,000    5.51      32,000
    3.5      2,226,000     6.47    463,000       164,000    5.76      30,000
    5.0      1,338,000     8.02    345,000       111,000    6.57      23,000
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                                  INDICATED
    -------------------------------------------------------------------------
    Zone                 Lower                              TOTAL
    -------------------------------------------------------------------------
    Cut-off                 Au                               Au
    (g/t) Au    Tonnes     (g/t)    Au (oz)       Tonnes    (g/t)     Au (oz)
    -------------------------------------------------------------------------
    2.0        118,000     3.20     12,000     3,884,000    5.02     627,000
    3.5         38,000     4.51      6,000     2,428,000    6.39     499,000
    5.0          9,000     5.64      2,000     1,458,000    7.89     370,000
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                                   INFERRED
    -------------------------------------------------------------------------
    Zone                 Upper                         Inter Fault
    -------------------------------------------------------------------------
    Cut-off                 Au                               Au
    (g/t) Au    Tonnes     (g/t)    Au (oz)       Tonnes    (g/t)     Au (oz)
    -------------------------------------------------------------------------
    2.0      5,002,000     4.00    643,000     1,591,000    4.60     235,000
    3.5      2,180,000     5.70    399,000       972,000    5.64     176,000
    5.0        987,000     7.61    242,000       552,000    6.69     119,000
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                                   INFERRED
    -------------------------------------------------------------------------
    Zone                 Lower                              TOTAL
    -------------------------------------------------------------------------
    Cut-off                 Au                               Au
    (g/t) Au    Tonnes     (g/t)    Au (oz)       Tonnes    (g/t)     Au (oz)
    -------------------------------------------------------------------------
    2.0      5,058,000     3.98    647,000    11,650,000    4.07   1,525,000
    3.5      2,360,000     5.65    429,000     5,511,000    5.67   1,004,000
    5.0      1,134,000     7.35    268,000     2,674,000    7.31     628,000
    -------------------------------------------------------------------------
    

    Mineralization at Jeronimo is hosted by sub-horizontal carbonates of
Jurassic age. It is best developed in a fossiliferous limestone near the base
of the carbonate sequence and occurs as very fine grained disseminated gold in
unoxidized, decarbonatized and silicified limestone. The gold mineralization
occurs commonly with arsenopyrite, marcasite, sphalerite, orpiment and realgar
and locally visible gold in strongly silicified jasperoids. The mineralization
has been traced along a strike length of 3.0 kilometres in three spatially and
genetically related deposits: Upper, Inter Fault and Lower Jeronimo. Both
Upper and Lower Jeronimo are sub-horizontal manto deposits while the Inter
Fault deposit has a steeper dip due to post mineral tectonic movement. The
oxide portion of the Jeronimo deposits, produced approximately 234,000 ounces
of gold, which was mined between 1997 and 2002.
    During the first half of 2008, a total of 69 combination reverse
circulation/diamond drill holes totalling 18,574 metres were completed at the
Upper Jeronimo deposit. The drill holes intersected the mineralization with
diamond core and were completed to give a better interpretation of ore grade
continuity of the Upper Jeronimo deposit. This data, along with previous
drilling, were used to complete a 3D geologic model and a geologic resource
using the ordinary kriging method.
    Metallurgical testwork including flotation, pressure oxidation and bio
leaching is currently underway to accommodate the unoxidized and refractory
nature of the Jeronimo mineralization.

    Amancaya, Chile

    The Amancaya deposit is located approximately 160 kilometres south of the
El Penon mine. Yamana is evaluating Amancaya as a stand alone project or in
conjunction with the further expansion of El Penon.
    At a 1.0 g/t gold equivalent (AuEq) cut-off grade for the potential open
pit resources and a 3.4 g/t AuEq cut-off grade for the underground resources,
inferred mineral resources is estimated at 407,000 contained ounces of AuEq at
a grade of 9.1 g/t AuEq. This is comprised of 351,000 contained ounces of gold
and 3,270,000 ounces of silver in 1.4 million tonnes at an average grade of
approximately 7.9 g/t Au and 73 g/t Ag, respectively. The silver to gold
conversion ratio used is 65:1 using reasonable long term metal prices, costs
and recoveries.
    The Amancaya deposit is a low sulphidation, epithermal gold deposit,
hosted in a steeply dipping, structurally controlled, quartz vein.
Mineralization is comprised of disseminated native gold and silver, electrum,
silver sulphosalts, and accessory sphalerite, galena, chalcopyrite, and pyrite
occurring with quartz, adularia, carbonates, clay minerals, limonite, and
manganese oxides. These minerals were deposited from boiling of dilute saline
fluids circulating in a hydrothermal system driven by the Eocene to Paleocene
magmatism.
    The mineralization at Amancaya is hosted in the Central Vein, a steeply
dipping quartz vein extending over a length of 1,300 metres, of which half is
under alluvial cover. The vein comes to surface on a small hill composed of a
brecciated dacite-andesite dome. Its main strike is N15 degreesE and dips vary
between 59 degrees and 90 degrees to the east. There is an abrupt change in
strike to S30 degrees E towards the south part of the vein. The vein has an
average thickness of 1.5 metres and is currently known to have 280 metres of
vertical extent. Drilling has shown that the vein and mineralization are
continuous.
    Yamana will continue with an exploration and infill drilling program.

    Qualified Person

    Mr. William H. Wulftange, P. Geo., Director, Corporate Technical
Compliance of Yamana Gold Inc., has reviewed and approved the data contained
within this press release pertaining to La Pepa, Jeronimo and Amancaya and
serves as the Qualified Person as defined in National Instrument 43-101 for
these projects.
    In this Press Release, the terms "mineral resource", "inferred mineral
resource", "indicated mineral resource" and "measured mineral resource" have
the meanings ascribed to those terms by the Canadian Institute of Mining,
Metallurgy and Petroleum, as the CIM Definition Standards on Mineral Resources
and Mineral Reserves adopted by CIM Council on December 11, 2005.

    LOOKING FORWARD

    The La Pepa, Jeronimo and Amancaya projects have been advanced since the
acquisition of Meridian. Having completed the first ever resource estimate for
La Pepa, Yamana continues to evaluate the size, scale and economic potential
of the project and is encouraged by the initial size of the deposit. The
Company will continue to evaluate Jeronimo in conjunction with its joint
venture partner, as well as evaluate Amancaya as a stand alone project or
satellite to El Penon. The Company is also evaluating the adjacent areas to
Amancaya to potentially increase its size and scale.
    These are all longer-term projects that further contribute to the future
growth of the Company. They give further comfort and confidence that the
Company's projects are advancing in order to achieve its stated objective and
strategic plan of increasing resources, developing projects and growing
production. In the meantime, Yamana is focusing on advancing Mercedes and
Ernesto/Pau-a-Pique as new projects, and increasing its resources at El Penon
and QDD Lower West at Gualcamayo.
    Resource estimates are calculated at a point in time. The resource
estimates for La Pepa, Jeronimo and Amancaya are as of July 4, 2008, July 18,
2008 and March 25, 2008, respectively. Exploration and drilling efforts would
have continued since those dates although would not be reflected in the stated
resource estimates.

    STRATEGIC OUTLOOK

    Yamana has previously guided that its production range is expected to be
1.95 to 2.5 million gold equivalent ounces (GEO) in 2012. Based on existing
resources, sustainable production of 1.95 million GEO is supported for and
from 2012. Assuming all projects are developed as planned and on schedule, the
maximum production is expected to increase to the higher end of the range.
Based on existing resources and proposed increases at projects now being
evaluated, the Company has formed a strategic objective of 2.2 million GEO in
2012. As the Company matures its projects, increases its resources and
continues with feasibility work, the Company will upgrade its strategic plan
into a more formalized mine plan for each project under evaluation.

    LOOKING AHEAD

    Upcoming Events

    
    -------------------------------------------------------------------------
    Event                                                      Expected Date
    -------------------------------------------------------------------------
    Ongoing drill programs at Mercedes and El Penon          Throughout 2008
    Production commences at Gualcamayo                             Late 2008
    Begin operations at Sao Vicente                                Late 2008
    Completion of Phase Two expansion at Jacobina                  Late 2008
    Complete Minera Florida expansion                              Late 2008
    Complete throughput increases at El Penon                      Late 2008
    Gualcamayo feasibility level study update (QDD Lower West)     Late 2008
    Feasibility level study for Mercedes                           Late 2008
    Complete internal study on Chapada pyrite and
     oxide project                                              By late 2008
    Complete feasibility level study for Chapada expansion      By late 2008
    Complete scoping study for El Penon mine and
     plant expansion                                            By late 2008
    -------------------------------------------------------------------------
    

    About Yamana

    Yamana is a Canadian-based gold producer with significant gold
production, gold development stage properties, exploration properties, and
land positions in Brazil, Argentina, Chile, Mexico, Central America and the
United States. Yamana is producing gold and other precious metals at
intermediate company production levels in addition to significant copper
production. The company continues to build on this base through existing
operating mine expansions and throughput increases, the advancement of its
exploration properties and by targeting other gold consolidation opportunities
in Brazil, Argentina, Chile and elsewhere in the Americas.

    FORWARD-LOOKING STATEMENTS: This news release contains certain
"forward-looking statements" within the meaning of Section 21E of the United
States Securities Exchange Act of 1934, as amended and "forward-looking
information" under applicable Canadian securities laws. Except for statements
of historical fact relating to the Company, information contained herein
constitutes forward-looking statements, including any information as to our
strategy, plans or future financial or operating performance. Forward-looking
statements are characterized by words such as "plan," "expect," "budget,"
"target," "project," "intend," "believe," "anticipate," "estimate" and other
similar words, or statements that certain events or conditions "may" or "will"
occur. Forward-looking statements are based on the opinions, assumptions and
estimates of management considered reasonable at the date the statements are
made, and are inherently subject to a variety of risks and uncertainties and
other known and unknown factors that could cause actual events or results to
differ materially from those projected in the forward-looking statements.
These factors include possible variations in ore grade or recovery rates,
fluctuating metal prices (such as gold, copper, silver and zinc), prices for
sulfuric acid and currency exchange rates (such as Brazilian Real versus the
US Dollar), changes in the Company's hedging program, changes in the Company's
corporate resources, changes in project parametres, changes in project
development and production time frames, the possibility of project cost
overruns or unanticipated costs and expenses, higher prices for fuel, steel,
power, labour and other consumables contributing to higher cash costs and
general risks of the mining industry, failure of plant, equipment or processes
to operate as anticipated, unexpected changes in levels of sustainability of
production, final pricing for concentrate sales, unanticipated results of
future studies, seasonality and unanticipated weather changes, as well as
those risk factors discussed or referred to in the Company's annual
Management's Discussion and Analysis and Annual Information Form filed with
the securities regulatory authorities in all provinces of Canada and available
at www.sedar.com, and the Company's Annual Report on Form 40-F filed with the
United States Securities and Exchange Commission.
    Although the Company has attempted to identify important factors that
could cause actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors that cause
actions, events or results not to be anticipated, estimated or intended. There
can be no assurance that forward-looking statements will prove to be accurate,
as actual results and future events could differ materially from those
anticipated in such statements. The Company undertakes no obligation to update
forward-looking statements if circumstances or management's estimates,
assumptions or opinions should change, except as required by applicable law.
The reader is cautioned not to place undue reliance on forward-looking
statements. The forward-looking information contained herein is presently for
the purpose of assisting investors in understanding the Company's expected
financial and operational performance and results as at and for the periods
referenced and may not be appropriate for other purposes.

    CAUTIONARY NOTE TO U.S. INVESTORS CONCERNING ESTIMATES OF MEASURED,
INDICATED AND INFERRED MINERAL RE

SOURCES This news release uses the terms "Measured", "Indicated" and "Inferred" Mineral Resources. United States investors are advised that while such terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them. "Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legally mineable.

For further information:

For further information: FOR MEDIA INQUIRIES: Mansfield Communications
Inc., Hugh Mansfield, (416) 599-0024; Yamana Gold Inc., Letitia Wong,
Director, Investor Relations, (416) 815-0220, Email: investor@yamana.com

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YAMANA GOLD INC.

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