AndeanGold Ltd.
TSX VENTURE : AAU

AndeanGold Ltd.

December 21, 2010 09:00 ET

AndeanGold Announces Urumalqui Au-Ag Project Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 21, 2010) - AndeanGold Ltd. ("the Company" or "AndeanGold") (TSX VENTURE:AAU) is pleased to announce the following update on its advanced-stage Urumalqui Au-Ag exploration project (the "Project") in Peru, where the Company is earning a 60% joint venture interest from Gitennes Exploration Inc. (See news release of April 22, 2010):

  • Environmental and Community Relations consultants (the "Consultants") have been engaged and are working productively on the requisite tasks necessary to timely obtain a permit (the "Permit") from the Peruvian governmental authorities to allow the Company to initiate a proposed Phase I infill drilling program (the "Program") on the Project. The Program will focus on infill drilling to a depth of 200 meters along the central and southeastern segments of the Urumalqui Vein, which cover 1.0 kilometre of the 1.5 kilometre Urumalqui Vein outcrop where the majority of the Project's historical drilling programs were concentrated.
  • Based on a review of the Project's historical geological information, the Company is now planning on increasing the Program from 2,000 to approximately 3,000 metres of diamond core infill drilling, which is intended to produce an overall drill hole spacing of approximately 50 metres over the 1.0 kilometre vein strike, to a depth of 200 metres. This level of drilling density should optimize the results of a NI 43-101 resource calculation, which the Company plans to commission upon completion of the Program.
  • New agreements have been signed with the key surface owners controlling lands covering the Urumalqui Vein to permit the Company to undertake its proposed drilling and exploration programs. Also, an agreement has been signed with a surface owner for a core storage facility.
  • A new core storage facility has been constructed, and the drill core from the Project's previous drilling programs has been transferred to this new facility.
  • The Company's geologists have relogged all Urumalqui Vein drill core from previous drilling programs and remapped the entire 1.5 kilometre Urumalqui Vein outcrop.
  • A topographical firm was engaged to relocate all the Project's previous drill collars covering the Urumalqui Vein and to establish the locations of the Company's proposed Phase I drill collars. This work was completed successfully during December.
  • Drilling companies have been contacted, and it appears that an appropriate diamond core drilling rig could be timely available to complete the Phase I drill program.
  • The Company's Consultants and legal counsel have advised that the Permit is expected to be approved during the second half of January 2011, which should enable the Company to initiate the Phase I drill program in February – March 2011.

About AndeanGold Ltd.:

AndeanGold Ltd. is engaged in the acquisition, exploration and potential development of primarily precious metals properties, principally in Peru and Ecuador. The focus of the Company's exploration activities is presently in advancing its Urumalqui Project, as well as pursuing mineral property acquisitions, in Peru. In Ecuador, the Company's activities have been limited to administrative and legal matters due to the Mining Mandate issued by the Ecuador Constituent Assembly on April 18, 2008. In November 2009, President Correa signed the Mining Regulations into law pursuant to the requirements of the new Mines Law, which was passed in January 2009. This was the final legal precursor to the re-initiation of exploration and mining development in Ecuador. The Company has been issued new mining titles under the new Mines law to its three key Ecuadorian projects and has filed the requisite documents with the Ministry of Non-Renewable Natural Resources and Ministry of Environment in support of the Company's request to renew exploration programs on its key projects in Ecuador. The Company is actively working with government officials to achieve this end.

Please refer to AndeanGold's website at www.andeangoldltd.com for further information on the Company's projects and activities.

On Behalf of the Board of Directors of ANDEANGOLD LTD.

Anthony F. Ciali, President, CEO and Director

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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