Uruguay Mineral Exploration Inc: Operations Update





    --  River diversion completed to original specification and timetable.

    --  Higher grade ore now being mined.

    --  Production for the first quarter to August 31 2007 estimated at
21,000 ounces, with production for the full year expected to be 95,000 ounces.

    LONDON, August 2 /CNW/ - Uruguay Mineral Exploration Inc (TSX
VENTURE:UME) (LSE:UGY):

    The Diversion of the Arroyo Corrales was completed in July. The diversion
canal has been completed to the original specification and water is flowing as
anticipated. The permanent northern flood protection dyke is 60% complete and
already affording adequate protection against moderate flood conditions and it
will be completed by 17 August, 2007. Construction of the southern flood
protection dyke has commenced and is expected to be completed by the end of
August. Temporary dykes have allowed the old water course to be dewatered and
pit development to commence. Re-vegetation of the banks of the diversion canal
has commenced and is progressing as planned. The first ore from the expansion
has been mined and processed.

    Lower grade material was mined in June and July while the river diversion
was being completed. As a result, production for the first quarter 2007/8 is
forecast to be 21,000 ounces. Production will recover in the following quarter
in line with higher grades and is expected to be 95,000 ounces for the year to
31 May, 2008.

    Qualified Person's Statement

    The information presented in this press release has been reviewed and
verified by Mr John Sadek, Vice President Operations. Mr Sadek is the
Qualified Person for the purposes of the AIM Guidance Note on Mining, Oil and
Gas Companies dated March 2006. He has a Bachelor of Engineering (Mining) from
the University of Sydney and is a member of the AusIMM and SME. He has over 20
years of international experience in mining.

    Forward Looking Statements

    All statements, other than statements of historical fact, contained or
incorporated by reference in this news release, including any information as
to the future financial or operating performance of the Company, constitute
"forward-looking statements" within the meaning of certain securities laws,
including the "safe harbour" provisions of the Securities Act (Ontario) and
the United States Private Securities Litigation Reform Act of 1995 and are
based on expectations estimates and projections as of the date of this news
release. There can be no assurance that such statements will prove to be
accurate, such statements are subject to significant risks and uncertainties,
and actual results and future events could differ materially from those
anticipated in such statements. Forward-looking statements include, without
limitation success of exploration activities; permitting time lines; the
failure of plant; equipment or processes to operate as anticipated; accidents;
labour disputes; requirements for additional capital title disputes or claims
and limitations on insurance coverage. The Company disclaims any intention or
obligation to update or revise any forward looking statements whether as a
result of new information, future events and such forward-looking statements,
except to the extent required by applicable law.

    The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this news release.

    Editors note: Uruguay Mineral Exploration Inc. is a gold producer and
exploration company focused on identifying and developing mineral
opportunities in Uruguay. UME is a fully integrated mining company, possessing
the skills necessary to explore and develop its discoveries. The Company
operates the only producing gold mine in Uruguay (San Gregorio), and is also
the leading mineral exploration company in Uruguay having assembled an
exploration portfolio based on gold, base metals (copper, nickel, lead, zinc)
and diamond prospects.

    Uruguay Mineral Exploration Inc. is quoted in Canada (TSXV) and London
(AIM) and Collins Stewart Europe Limited is its Nominated Adviser and Broker.




For further information:

For further information: Uruguay Mineral Exploration Inc Tony Shearer,
Chairman, +44 20 7602-1570 tonyshearer@btinternet.com or David Fowler, CEO,
598 2 6016354 urumin@ume.com.uy or Shared Value Ltd Emily Bruning, +44 20 7321
5027 ebruning@sharedvalue.net or Collins Stewart Europe Limited Chris
Rollason, +44 20 7523 8308 crollason@collins-stewart.com

Organization Profile

URUGUAY MINERAL EXPLORATION INC.

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