Valencia Ventures Inc.
TSX VENTURE : VVI

Valencia Ventures Inc.

October 31, 2006 16:05 ET

High Grade Silver Mineralization Intersected at Valencia's Cachinal Silver Project, Chile

WIDE INTERSECTIONS +100G/T SILVER OPEN AT DEPTH

TORONTO, ONTARIO--(CCNMatthews - Oct. 31, 2006) - Valencia Ventures Inc. (TSX VENTURE:VVI) is pleased to report wide zones of high grade silver mineralization which remain open at depth and along strike to the north and southwest from a recently completed Reverse Circulation (RC) drilling program at the Company's Cachinal Silver Project in northern Chile, including:



- 28m @ 101.18g/t (3.25oz/t) silver (CLRC-18)
Including: 3m @ 128.66g/t ( 4.14oz/t) silver
4m @ 460.00g/t (14.79oz/t) silver

- 17m @ 181.35g/t (5.83oz/t) silver (CLRC-25)
Including: 2m @ 611.50g/t (19.66oz/t) silver

- 26m @ 124.77g/t (4.01oz/t) silver (CLRC-36)
Including: 2m @ 137.50g/t (4.42oz/t) silver
1m @ 951.0 g/t (30.58 oz/t) silver
3m @ 231.67g/t (7.45oz/t) silver

- 33m @ 142.82g/t (4.59oz/t) silver (CLRC-51)
Including: 2m @ 1702.5g/t (54.74oz/t) silver

- 25m @ 141.44g/t (4.55oz/t) silver (CLRC-56)
Including: 2m @1246.0g/t (40.06oz/t) silver


In addition, the higher grade silver intersections have associated gold values of 0.10 - 1.51g/t gold (Table 1).

These results, together with 2005-2006 surface trench and 2005 RC drill results, confirm the potential to define a silver resource over a strike length in excess of 600m to a depth of 200-225m which could be amenable to open pit extraction.

Doug Currie, Valencia's Executive Vice-President Exploration & Development, commented on the results of the drill program, "I am very encouraged by the wide zones of high grade silver mineralization that we have intersected." He added, "These results confirm our initial view on the potential for Cachinal to host a significant silver resource and suggest we may be able to significantly increase the size of the potential resource with deeper drilling and further drilling along strike."

Drilling has confirmed the existence of broad "halo" zones of silver mineralization adjacent to the narrow, very high grade structures which were historically mined.

Intersection of several of these very high grade structures also indicates that historical mining may not have extracted all of these structures. Our efforts will now focus on preparation of an initial resource estimation and additional drilling to expand the resource potential.

The 40 hole, 4804m, RC drilling program evaluated the 600m long mineralized structures in the prospective Carmen and Arturo-Prat zone of the historical Cachinal de la Sierra Silver area. The current program was designed to evaluate the size and continuity of the zone of mineralization and to determine the potential to define an open pittable resource to 150m depth. Holes were drilled along fences placed at approximately 50m intervals to intersect interpreted mineralized structures at vertical depths of 40m, 80m and 120m (Figure 1). Three deeper RC holes, CLRC-49, 51 and 52, were drilled to intersect interpreted structures at vertical depths between 120 and 225m. Eight holes were terminated prematurely when they intersected old workings; two holes passed through narrow workings into the footwall of the structure.

Surface trench results, reported in July, confirmed wide zones of high grade silver mineralization associated with two intersecting northwesterly trending vein systems, the Carmen and Arturo-Prat Veins, indicated by Valencia's 2005 trenching and RC drilling program (See Press Release July 26, 2006). Better results included:



- T-22 22m @ 121.18 g/t Ag,0.17g/t Au
- T-26 10m @ 194.20 g/t Ag, 0.18g/t Au
- T-31 2m @ 313.00 g/t Ag, 0.64g/t Au
- T-38 21m @ 103.33 g/t Ag, 0.10g/t Au
- and 12m @ 100.83 g/t Ag, 0.07g/t Au
- TRS-2 2m @ 1030 g/t Ag, 0.58g/t Au
- TRS-4 2m @ 544 g/t Ag, 0.29g/t Au
- TRS-6 9.5m @ 288.26 g/t Ag, 0.17g/t Au


Valencia's 16 hole, 2,294m 2005 RC drill program encountered several high grade silver intersections, including 14m @ 114.57g/t Ag (3.68 oz/t silver) in CLRC-01, 21m @ 189.29g/t Ag (6.09 oz/t silver) in CLRC-02 and 40m @ 137.87g/t Ag (4.43 oz/t silver) in CLRC-12, including 18m @ 231.38 g/t Ag and including 5m @ 670.00 g/t Ag and 0.689g/t Au, at approximately 95m below surface, in the hanging wall of the Carmen Vein (Press Releases April 29 and June 8, 2005).

Silver mineralization is associated with irregular quartz veinlets and silicified breccia associated with several parallel easterly dipping structures in both volcaniclastic sediments and dacitic crystal tuff. There is a preferred location of the main high grade, Carmen Vein along the lithological contact between the sediments and tuff; however, mineralization also occurs within the Arturo Prat Vein which is related to a more brittle structure within the tuff. Drilling, as shown on Section 150SE, has confirmed the multiple, sub-parallel nature of wide mineralized zones which are open at depth (Figure 2).

A program of 300-500m of diamond drilling is planned for completion at the earliest opportunity to twin RC drill intersections for verification of RC results, to provide information on rock density and to provide core for initial metallurgical testwork. Arrangements are also being made to complete an initial NI43-101 Technical Report, including a resource estimation.

Drilling was also completed to test several structures defined by VLF-EM geophysics in 2005 on the eastern side of the property and additional soil geochemistry and trenching was completed to evaluate silver-gold soil geochemical anomalies at the Relincho target to the south. No significant mineralization was observed at either target.

Cachinal Silver Project

Historically a significant silver district, the Cachinal de la Sierra area is located within the Paleocene Gold Belt of northern Chile which hosts several significant gold and silver deposits, including Meridian Gold Inc's El Penon Silver-Gold Mine, a low sulphidation-style epithermal silver-gold deposit and one of the worlds lowest cost gold producers, 60km to the northeast, and Diamond Rose NL's Guanaco Gold Mine, a high sulphidation-style epithermal deposit which was mined as a heap leach operation during the early 1990's by Amax Gold Inc and later Kinross Gold Corporation, 12km to the southwest.

Silver mining began at Cachinal in 1862 and, including production of approximately 170,000 tons @ 280g/t Ag, 0.58g/t Au reported for a three year period 1985-1987, historical production is estimated at approximately 32 million ounces of silver in historical geological reports in the library and files of Chilean Government agency SERNAGEOMIN. Extensive historic workings at Cachinal reportedly extend to a depth of 320m although most of the workings only went to a depth of 120-150m, generally within the oxidized zone. Historical grades apparently averaged 500-600g/t silver with an unknown quantity of trace gold, with some local values of up to 2500g/t silver and as much as 3g/t gold reported. The production figures (tonnage and grade) referred to in the preceding sentences are historical in nature, have not been verified by the issuer's Qualified Person, and should not be relied upon.

Valencia assembled a large land position totalling 9,200 hectares at Cachinal late in 2004, entering into farm-in agreements with Compania Contractual Minera Ojos del Salado, an indirect Chilean subsidiary of Phelps Dodge Corporation (NYSE:PD), Silver Standard Resources Inc (NASDAQ:SSRI)(TSX:SSO) and Atna Resources Ltd (TSX:ATN) to acquire interests in their properties which cover the historic mining center. (See Press Releases dated October 12, 2004 and February 3, 2005 for terms of each farm-in arrangement, Figure 1). Valencia has also acquired direct interest in additional areas adjoining the JV areas.

Valencia also wishes to advise that it has decided not to proceed with an option to acquire an interest in the Chanarcillo Property, also in Chile, as previously announced (See Press Release August 9, 2006).

Shareholders are encouraged to visit Valencia's website (www.valenciaventures.com) to view a recent corporate presentation which provides images and more technical information on these projects. For additional information, e-mail info@valenciaventures.com

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.

Regulatory Footnotes:

Mr. Douglas A. Currie, MAusIMM, Valencia's Executive Vice President-Exploration & Development, is the Qualified Person as defined under National Instrument 43-101 responsible for the scientific and technical work on the exploration program and is responsible for reviewing the technical disclosure in this press release. Field work in Chile has been performed under Mr Currie's supervision by SBX Consultores Ltda, Santiago, Chile.

All analytical work has been completed by ALS Chemex of North Vancouver, BC, Canada; ALS Chemex is a respected international analytical service which is accredited with NATA and complies with standards of ISO 9001:2000 and ISO 17025:1999. They employ a variety of international standards for quality control purposes.

Samples are transported from the field project to the ALS Chemex sample preparation facility in Coquimbo, Chile by the Contractor's personnel or a reputable commercial carrier. All analytical testing is performed utilizing a variety of industry standard analytical techniques, including: (i) ALS Analytical Code ME-MS41 - 50 element analysis using aquaregia digest and ICPAES analysis, (ii) ALS Analytical Code AA46 & AA62 - specific element analysis using aquaregia digest and AAS determination (Ag, Zn, Pb, Cu, As) and, (iii) Analytical Code Au-AA26 - Gold using a 50g Fire Assay-AAS finish.

All Reverse Circulation drill samples were geologically logged and sampled by the Contractor's geologists in one(1) meter sample intervals; the archive portion of the sample is securely stored at the Contractor's facility in La Serena, Chile. The Company has initiated a QA/QC program consisting of utilizing standards, duplicate and blank samples and laboratory cross-checks and routinely repeats sample analysis.

Trench samples are chip-channel samples taken over a 5-10cm wide channel cut in the bottom of an excavated trench. Sample intervals are normally 2m composites in zones of alteration or mineralization and less than 2m composites through well defined vein or veinlets zones.

Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward-looking statements".



TABLE 1
CACHINAL SILVER PROJECT
2006 RC DRILL PROGRAM SIGNIFICANT DRILL INTERSECTIONS

-------------------------------------------------------------------
FROM TO WIDTH Au Ag Ag
HOLE NO SECTION (m) (m) (m) (g/t) (g/t) (oz/t)
-------------------------------------------------------------------

-------------------------------------------------------------------
CLRC-17 550SE 69 84 15 0.009 55.06 1.77
---------------------------------------------------------
Including 73 75 2 0.041 124.00 3.99
---------------------------------------------------------
less
than
Including 79 80 1 0.005 125.00 4.02
---------------------------------------------------------
87 95 8 0.010 38.87 1.25
---------------------------------------------------------
98 102 4 0.060 58.25 1.87
---------------------------------------------------------
Including 101 102 1 0.182 120.00 3.86
-------------------------------------------------------------------
CLRC-18 600SE 60 63 3 0.246 39.33 1.26
-------------------------------------------------------------------
70 98 28 0.104 101.18 3.25
---------------------------------------------------------
Including 70 73 3 0.710 128.66 4.14
---------------------------------------------------------
Including 94 98 4 0.116 460.00 14.79
-------------------------------------------------------------------
CLRC-19 650SE 33 35 2 0.043 65.00 2.09
-------------------------------------------------------------------
41 43 2 0.024 45.00 1.45
---------------------------------------------------------
115 117 2 0.073 47.00 1.51
-------------------------------------------------------------------
CLRC-20 700SE No Significant Results
-------------------------------------------------------------------
CLRC-21 700SE 99 100 1 0.036 29.00 0.93
-------------------------------------------------------------------
CLRC-22 450SE 17 19 2 0.040 30.00 0.96
---------------------------------------------------------
64 69 5 0.070 42.60 1.37
-------------------------------------------------------------------
CLRC-23 500SE 104 105 1 0.029 38.00 1.22
-------------------------------------------------------------------
CLRC-24 500SE 9 10 1 0.137 44.00 1.41
---------------------------------------------------------
45 50 5 0.092 130.00 4.18
---------------------------------------------------------
Including 49 50 1 0.136 521.00 16.75
-------------------------------------------------------------------
CLRC-25 400SE 24 26 2 0.055 62.50 2.01
---------------------------------------------------------
77 94 17 0.084 181.35 5.83
---------------------------------------------------------
Including 84 86 2 0.254 611.50 19.66
-------------------------------------------------------------------
CLRC-26 550SE No Significant Results
-------------------------------------------------------------------
CLRC-27 350SE 38 46 8 0.372 123.75 3.98
---------------------------------------------------------
Including 41 43 2 0.664 305.50 9.82
---------------------------------------------------------
58 62 4 0.031 48.75 1.57
---------------------------------------------------------
Including 61 62 1 0.069 103.00 3.31
---------------------------------------------------------
67 73 6 0.014 57.00 1.83
---------------------------------------------------------
Including 69 71 2 0.015 115.00 3.70
---------------------------------------------------------
76 87 11 0.064 45.91 1.48
---------------------------------------------------------
Including 85 87 2 0.131 129.00 4.15
-------------------------------------------------------------------
CLRC-28 300SE 67 69 2 0.066 56.50 1.82
-------------------------------------------------------------------
CLRC-29 250SE 64 69 5 0.096 109.80 3.53
---------------------------------------------------------
Including 64 65 1 0.439 328.00 10.55
---------------------------------------------------------
76 79 3 0.052 64.00 2.06
---------------------------------------------------------
107 117 10 0.053 42.10 1.35
-------------------------------------------------------------------
CLRC-30 250SE 32 34 2 0.027 114.50 3.68
-------------------------------------------------------------------
CLRC-31 450SE 80 81 1 0.007 38.00 1.22
-------------------------------------------------------------------
CLRC-32 400SE 58 59 1 0.049 41.00 1.32
---------------------------------------------------------
75 78 3 0.418 82.67 2.66
---------------------------------------------------------
Including 77 78 1 0.818 199.00 6.40
-------------------------------------------------------------------
CLRC-33 350SE 68 80 12 0.073 51.58 1.66
---------------------------------------------------------
Including 75 80 5 0.104 97.40 3.13
-------------------------------------------------------------------
CLRC-34 300SE No Significant Results
-------------------------------------------------------------------
CLRC-35 50SE 6 17 11 0.164 109.36 3.52
---------------------------------------------------------
Including 12 15 3 0.556 312.00 10.03
-------------------------------------------------------------------
CLRC-36 100SE 16 21 5 0.056 79.80 2.57
---------------------------------------------------------
Including 18 19 1 0.230 222.00 7.14
-------------------------------------------------------------------
43 69 26 0.063 124.77 4.01
---------------------------------------------------------
Including 49 51 2 0.111 137.50 4.42
---------------------------------------------------------
Including 58 59 1 0.307 951.00 30.58
---------------------------------------------------------
Including 62 65 3 0.068 231.67 7.45
---------------------------------------------------------
83 85 2 0.201 82.50 2.65
-------------------------------------------------------------------
CLRC-37 150SE 15 34 19 0.095 101.74 3.27
---------------------------------------------------------
Including 19 20 1 0.586 323.00 10.39
---------------------------------------------------------
Including 24 25 1 0.652 404.00 12.99
---------------------------------------------------------
Including 28 30 2 0.188 299.00 9.61
---------------------------------------------------------
51 56 5 0.136 59.60 1.92
---------------------------------------------------------
Including 54 55 1 0.657 128 4.12
---------------------------------------------------------
less
than
66 67 1 0.005 36 1.16
-------------------------------------------------------------------
CLRC-38 200SE 54 59 5 0.031 54.60 1.76
---------------------------------------------------------
Including 58 59 1 0.052 114.00 3.67
-------------------------------------------------------------------
CLRC-39 600SE 24 27 3 0.132 51.67 1.66
-------------------------------------------------------------------
CLRC-40 600SE 19 43 24 0.292 43.96 1.41
-------------------------------------------------------------------
Including 40 41 1 0.419 300.00 9.65
-------------------------------------------------------------------
CLRC-41 Regional No Significant Results
-------------------------------------------------------------------
CLRC-42 Regional No Significant Results
-------------------------------------------------------------------
CLRC-43 Regional No Significant Results
-------------------------------------------------------------------
CLRC-44 Regional No Significant Results
-------------------------------------------------------------------
CLRC-45 Regional No Significant Results
-------------------------------------------------------------------
CLRC-46 Regional No Significant Results
-------------------------------------------------------------------
CLRC-47 400SE 14 36 22 0.177 155.41 5.00
-------------------------------------------------------------------
Including 18 19 1 0.230 246.00 7.91
-------------------------------------------------------------------
Including 32 36 4 0.839 622.00 20.00
-------------------------------------------------------------------
CLRC-48 0SE No Significant Results
-------------------------------------------------------------------
CLRC-49 100SE 3 6 3 0.150 316.33 10.17
---------------------------------------------------------
20 36 16 0.016 21.38 0.69
---------------------------------------------------------
45 48 3 0.278 109.00 3.50
---------------------------------------------------------
Including 47 48 1 0.811 269 8.65
---------------------------------------------------------
74 75 1 0.027 28.00 0.90
-------------------------------------------------------------------
CLRC-50 650SE 62 65 3 0.037 17.00 0.55
-------------------------------------------------------------------
CLRC-51 150SE 35 68 33 0.099 142.82 4.59
---------------------------------------------------------
Including 38 40 2 0.915 1702.50 54.74
---------------------------------------------------------
Including 49 50 1 1.040 214.00 6.88
---------------------------------------------------------
Including 58 61 3 0.008 39.70 1.28
---------------------------------------------------------
Including 65 67 2 0.031 30.00 0.96
---------------------------------------------------------
less
than
68 79 11 0.005 15.40 0.50
---------------------------------------------------------
216 231 15 0.010 3.50 0.11
---------------------------------------------------------
Including 226 231 5 0.021 5.40 0.17
---------------------------------------------------------
232 261 29 0.013 12.55 0.40
---------------------------------------------------------
Including 232 235 3 0.051 38.33 1.23
---------------------------------------------------------
293 294 1 0.065 15 0.48
-------------------------------------------------------------------
CLRC-52 600SE 191 211 20 0.012 16.90 0.54
---------------------------------------------------------
Including 191 192 1 0.037 36 1.16
---------------------------------------------------------
Including 195 200 5 0.022 25.20 0.81
-------------------------------------------------------------------
CLRC-53 650SE No Significant Results
-------------------------------------------------------------------
CLRC-54 650SE 54 60 6 0.012 18.67 0.60
-------------------------------------------------------------------
CLRC-55 300SE 33 43 10 0.057 47.40 1.52
---------------------------------------------------------
Including 36 37 1 0.100 100.00 3.22
-------------------------------------------------------------------
CLRC-56 150SE 19 29 10 0.195 152.80 4.91
---------------------------------------------------------
Including 21 22 1 1.510 1040.00 33.44
---------------------------------------------------------
74 99 25 0.132 141.44 4.55
---------------------------------------------------------
Including 83 85 2 1.282 1246.00 40.06
---------------------------------------------------------
Including 86 87 1 0.064 209.00 6.72
---------------------------------------------------------
137 150 13 0.094 119.46 3.84
---------------------------------------------------------
Including 138 139 1 0.557 226.00 7.27
---------------------------------------------------------
Including 149 150 1 0.442 845.00 27.17
---------------------------------------------------------
152 154 2 0.032 73 2.35
-------------------------------------------------------------------
CLRC-57 200SE 120 130 10 0.527 362.50 11.66
---------------------------------------------------------
Including 121 122 1 0.584 1325.00 42.60
---------------------------------------------------------
131 139 8 0.057 50.75 1.63
-------------------------------------------------------------------


To view maps of the "Trench Mineralization & Drill Locations - Cachinal Project, Chile" and " Reverse Circulation Drilling Section 150SE - Cachinal Project, Chile", please click on the link below:

http://www.ccnmatthews.com/docs/vvi1031.pdf

THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Contact Information

  • Valencia Ventures Inc.
    Doug Bache
    President and CEO
    (416) 861-5884
    or
    Valencia Ventures Inc.
    Doug Currie
    Executive Vice-President, Exploration and Development
    (416) 861-5898
    or
    Valencia Ventures Inc.
    David Meyer
    Vice-President, Business Development
    (416) 861-5891
    Email: info@valenciaventures.com
    Website: www.valenciaventures.com