Valencia Ventures Inc.

Valencia Ventures Inc.

May 16, 2006 16:05 ET

Valencia Approves $750,000 Exploration & Drill Program For Rancheria Silver Project

TORONTO, ONTARIO--(CCNMatthews - May 16, 2006) - Valencia Ventures Inc. (TSX VENTURE:VVI) has approved an initial $750,000 summer exploration program of mechanical trenching and 2,500 m of Reverse Circulation (RC) drilling for its Rancheria Silver Project in the Yukon Territory and British Columbia. Valencia's exploration program is designed to target and further evaluate the high-grade silver occurrences located within the project areas to determine the potential for hosting sizeable silver deposits. The Company expects this exploration program to commence in late June 2006.

Trenching and drilling will focus on three of the seven properties comprising the Rancheria Silver project, the Ranch, Blue Heaven and Touchdown properties (Figure 1). Prospecting, geological mapping, and soil and rock geochemistry will be conducted on the other properties.

RC drilling at the Ranch property will target low sulphidation epithermal-style silver mineralization which is hosted in vein and fracture fillings associated with a system of strong faults that cut the Cassiar Batholith. Fences of drillholes will be drilled across interpreted structural linears and splay faults to evaluate historical mineralized chip samples in bedrock, including the best interval of 1,525g/t silver across 1.5 metres. Historical sampling of over 30 sites on the plateau hosting the linears has returned over 340g/t Ag in vein material. The Ranch property has never been tested by mechanical trenching or drilling.

The Blue Heaven property hosts 16 zones of anomalous and significantly mineralized, high grade silver veins, zones of silver lead-zinc Carbonate Replacement Mineralization (CRM) and tungsten plus or minus copper skarns. The veins are strongest where they cut granitic rocks; a 1999 hand sorted bulk sample of vein material from shallow excavations on two of the main veins contained 51.47 dry tonnes grading 8,563 g/t silver, 56.2% lead, 9.5% zinc and 1.2g/t gold. These target zones at the Blue Heaven property have never been drilled.

CRM zones defined by extensive soil geochemical anomalies are confined to a 200500m thick stratigraphic section of calcareous metasediments extending over 4km along strike. The zone has been exposed by several historical excavator trenches and one historical diamond drill hole, with typical grades of 5-100 g/t silver, trace 5% lead and 2-5% zinc. Little work has been done on the tugsten skarn targets which have produced rock specimens to 3.6% WO3 and 0.3% WO3 over 9.3m in a trench.

Excavator trenching is planned to further evaluate the vein and CRM targets at Blue Heaven, with follow-up RC drilling to be located after determination of the better mineralized zones.

Silver mineralization at the Touchdown property has been defined within a strong soil geochemical anomaly covering part of a structural zone 450m long and up to 50m wide. Seven historical samples of CRM with high grade silver and zinc and varying amounts of lead and copper averaged 275g/t silver, 14.0% zinc and 0.43% lead. Historically, no mechanical trenching or drilling has been performed. This year's program will include excavator trenching to evaluate the main CRM targets and to establish drill targets for subsequent programs.

Historical results referenced above have been extracted from a NI 43-101 Technical Report on the properties dated April 2006 prepared for Valencia Ventures Inc by William A. Wengzynowski, P. Eng., of Archer, Cathro & Associates (1981) Limited, which has been filed with the TSX-V and filed on SEDAR April 25, 2006 (See Valencia Press Release dated April 11, 2006). Mr Wengzynowski has provided written consent to inclusion of the references to this report in this disclosure.

Valencia's summer exploration program will be managed by Archer, Cathro & Associates (1981) Limited, a geological consulting group having extensive exploration management experience in the Yukon and northern BC and have previously worked on the Rancheria projects. The program, which will commence as soon as seasonal conditions allow unrestricted access, most likely late June 2006, satisfies Valencia's first year expenditure under its agreement with Strategic Metals Ltd.

Mr. Doug Currie, Valencia's Executive Vice-President, Exploration & Development noted, "Historical exploration has demonstrated silver mineralization occurs within the Rancheria projects in both high grade vein and Carbonate Replacement style settings similar to those found within productive silver camps elsewhere in the Cordillera of Canada, United States and Mexico. Additional trenching and drilling will advance our understanding of these zones of mineralization and hopefully, if results are positive, establish the basis for resource definition drilling in a second phase of drilling later in 2006. "

Valencia has an option to earn up to 100% in the Rancheria Silver Project from Prye Company AB, subject to an existing agreement with Strategic Metals Ltd (See Valencia Press Release dated April 11, 2006 for full terms of the agreement). Initially, in addition to other cash payments and the issuance of shares, described in full in the above referenced press release, to earn a 75% interest Valencia must spend a total of $3.0million in exploration over three years, with $750,000 to be spent by the first anniversary; the current program will satisfy this requirement.

Valencia also confirms exploration is continuing at its Cachinal Silver Project in northern Chile. The current program will comprise approximately 1,000m of trenching, 4,000m of reverse circulation (RC) drilling and 500-1,000m of diamond drilling (DD) to better define the known mineralized structures and to confirm and evaluate extensions to high grade silver mineralization intersected by surface trenching and RC drilling in 2005 (See Valencia Press Release dated April 18, 2006).

The first stage of the program has commenced and includes topographic and geological mapping. An excavator will mobilize to the site shortly to commence trenching. Drilling is planned to follow the trenching program late in June.

Valencia is a Canadian resource company traded under the symbol VVI on the TSX Venture Exchange. Valencia's development strategy is focused on the exploration and development of precious metal properties, particularly the Cachinal Silver Project in Chile and the Rancheria Silver Project in the Yukon Territory and British Columbia, Canada. The company has recently completed a feasibility study for the Mt. Bundy Gold Project in the Northern Territory, Australia, and is considering various development strategies. With a focus on silver, the company has a number of precious metal acquisitions under consideration.

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Contact Information

  • Valencia Ventures Inc.
    Doug Bache
    President and CEO
    (416) 861-5884
    Valencia Ventures Inc.
    Doug Currie
    Executive Vice-President, Exploration and Development
    (416) 861-5898
    Valencia Ventures Inc.
    David Meyer
    Vice-President, Business Development
    (416) 861-5891