Minera Andes Inc.

Minera Andes Inc.

January 07, 2005 08:30 ET

Minera Andes 2005 Development/Exploration Program Aims To Build On Success Of 2004


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: MINERA ANDES INC.

TSX VENTURE SYMBOL: MAI
OTC Bulletin Board SYMBOL: MNEAF

JANUARY 7, 2005 - 08:30 ET

Minera Andes 2005 Development/Exploration Program Aims
To Build On Success Of 2004

SPOKANE, WASHINGTON--(CCNMatthews - Jan. 7, 2005) - Minera Andes Inc.
(TSX VENTURE:MAI)(OTCBB:MNEAF) is pleased to report on its success in
exploration and development in 2004. The Company made significant
strides in its business plan during the year, particularly with
development at the advanced-stage Huevos Verdes silver/gold vein,
located within the San Jose project area in southern Argentina. In
addition, new gold, silver and copper discoveries were made by Minera
Andes on its 100 percent-owned exploration projects in Argentina.
Management has been active in Argentina for eleven years and has
developed a strong expertise in all aspects of conducting
exploration/development business therein.

Allen V. Ambrose, president, reports "In 2004, our operating partner
Mauricio Hochshild & Cia Ltda. has accelerated the work program at
Huevos Verdes, and are dedicated to fast development there in order to
achieve feasibility. This demonstrates confidence in the integrity and
potential of the Huevos Verdes vein system as well as in the overall San
Jose project. Also in 2004, Minera Andes' new gold, silver and copper
discoveries added significant new value to the Company's asset base. We
look forward to further exploring these and other target areas in
Argentina in 2005."

Silver/Gold Pre-Production Project Advances

Major events occurred in 2004 to advance the Huevos Verdes construction
project. The accelerated development at this vein-hosted,
low-sulfidation, epithermal silver/gold mineralization system has moved
the joint venture much closer to a production decision.

- A comprehensive, third-party feasibility study was commissioned to
assess possible mine production.

- Underground construction commenced focused on an area of drill-proven,
high-grade mineralization of some 2.3 km in length.

- Underground testing discovered new high-grade silver/gold zones and
previously unknown veins. These discoveries hold potential for increased
grade and tonnage at Huevos Verdes. One sample reported last year
encountered bonanza grades of 728 ounces per ton (22,653 g/t) silver and
6.4 ounces per ton (198 g/t) gold.

- Metallurgical testing of Huevos Verdes' silver/gold mineralization
demonstrated high recoveries (over 90 percent for both silver and gold)
are possible using standard industry technology. This high recovery
percentage could increase overall recovery in the potential mine
situation at Huevos Verdes.

- Reflecting confidence in Huevos Verdes, pre-production employment at
San Jose project exceeded 160 by December 2004 compared to 53 in January
2004, an increase in work-force of over 300%.

- Access routes to the project area were completed, including a 28 km
all-weather road with bridge access and selected surface land rights
were purchased at San Jose.

Mauricio Hochschild & Cia. Ltda. of Lima, Peru is the operating partner
(51 percent) of the San Jose project with Minera Andes owning the
remaining 49 percent.

Minera Andes Makes New Discoveries

Minera Andes has historically concentrated its attention on the
discovery of gold, silver and copper in Argentina. In 2004, in addition
to the discoveries at San Jose, Minera Andes undertook a 100
percent-owned and managed exploration program resulting in new
discoveries of all three metals. A summary is as follows:

- Exploration at Huevos Verdes continued to identify more silver/gold
mineralization. The Huevos Verdes vein itself remains open at depth and
laterally. The entire San Jose project area is host to four parallel
vein structures totaling some 32 kilometres in combined length, as
outlined by reconnaissance field work and geophysical surveys conducted
by Minera Andes. Only some 15% of the outlined vein package has yet been
drilled.

- Drilling at Huevos Verdes East intersected significantly higher-grade
silver/gold mineralization than is currently known at Huevos Verdes. The
Huevos Verdes East vein is a parallel vein approximately two kilometers
to the east of the Huevos Verdes vein which management feels has
excellent potential to host an economic silver/gold ore body as well.

- Reconnaissance drilling in west central Argentina confirmed the
discovery of a sizeable zone of enriched copper. The Los Azules copper
project contains preliminary drill showings of leachable secondary
copper mineralization.

- Minera Andes identified four new gold/silver prospects and drilled two
properties in southern Argentina. Minera Andes also continued an ongoing
exploration program to locate new discoveries.

Minera Andes is a gold, silver and copper exploration company working in
Argentina funded with working capital of about US$1.5 million and a
pending credit facility of up to US$3 million for feasibility completion
and underground construction at its advanced-stage silver/gold project
in Santa Cruz province. Minera Andes holds about 500,000 acres of
mineral exploration land in Argentina, including the co-owned Huevos
Verdes/San Jose silver/gold project now under construction and
feasibility consideration for possible mine production. Minera Andes has
also discovered an enriched copper zone at its Los Azules property and
is acquiring other exploration targets in southern Argentina. The
Corporation presently has 71,609,306 issued and outstanding shares.



Spokane Office Vancouver Office
111 East Magnesium Rd., Suite A 410 - 744 West Hastings Street
Spokane, WA 99208 USA Vancouver, B.C. V6C 1A5
Phone: (509) 921-7322 Phone: (604) 689-7017; 877-689-7018
E-mail: mineraandes@minandes.com E-mail: ircanada@minandes.com


FORWARD-LOOKING STATEMENT - Although Minera Andes believes many of its
properties have promising potential, its properties are in the early
stages of exploration. None have yet been shown to contain proven or
probable mineral reserves. There can be no assurance that such reserves
will be identified on any property, or that, if identified,
mineralization may be economically extracted. There can be no assurance
that the San Jose/Huevos Verdes gold/silver project will be found to be
economically feasible or that a mine will be successfully constructed.
In addition, Minera Andes' joint venture partner, Mauricio Hochschild &
Cia. Ltda., does not accept responsibility for the use of project data
or the adequacy or accuracy of this release.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Minera Andes Inc.
    Art Johnson
    Spokane Office
    (509) 921-7322
    or
    Minera Andes Inc.
    Krister A. Kottmeier, investor relations - Canada
    Vancouver Office
    (604) 689-7017; 877-689-7018
    www.minandes.com
    THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
    RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.