Jinshan Gold Mines Inc.
TSX : JIN

Jinshan Gold Mines Inc.

January 31, 2008 08:08 ET

Jinshan Announces 778,000 Ounce Gold Resource at Its Dadiangou Project, China

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 31, 2008) - Jinshan Gold Mines Inc. (TSX:JIN) is pleased to announce results of an initial NI 43-101 compliant independent resource estimate at its Dadiangou gold project in Gansu Province, China. An Inferred Resource of 26.3 million tonnes grading 0.92 grams per tonne (g/t) gold, totaling 778,000 ounces of contained gold, was calculated using a cut-off grade of 0.4 g/t gold. Within this global resource, a 1.9 million-tonne higher-grade core was delineated that grades 2.48 g/t gold and contains 152,000 ounces at the same 0.4 g/t cut-off.

The Dadiangou Project is envisioned as a potential open-pit, cyanide-leach gold operation. The main mineralized shear zone at Dadiangou, is vertical to steeply north-dipping and has been delineated for 3,170 metres in strike length, with typical widths of 50 to 60 metres over 2/3 of its strike length, but can vary from 10 to 80 metres in width. The results of this resource estimate and block model will now be used to plan exploration programs at Dadiangou for the 2008 field season. Further exploration efforts targeting additional resources at Dadiangou and possible infill drilling of the present resource will continue, and Jinshan will now begin to gather the information needed for a preliminary economic assessment.

"We are pleased to complete our first resource estimate at Dadiangou within one year of commencing work on the project," said Jinshan's Vice President of Exploration, Keith Patterson. "Our General Manager, Tony Guo, and his exploration team will now focus on further expansion of the deposit and the initiation of a preliminary economic assessment."

The Dadiangou gold system is located in the central part of China in southern Gansu Province within the prolific Qinling Fold Belt. The license covers approximately 15 square kilometres and is owned by the Northwest Industrial Nuclear Economic Technical Corp. (part of the Shaanxi Nuclear Geology Bureau of China). The joint-venture agreement with the Northwest Industrial Nuclear Economic Technical Company (the Chinese partner) allows Jinshan to earn a minimum of 80% on the property, with the Chinese partner having the option to participate at 20%, or to become diluted.

The Dadiangou Main Zone (DMZ) contains approximately 87% of the estimated resource. The Dadiangou South Zone (DSZ) and Dadiangou Far South Zone (DFSZ) make up approximately 12% of the total resource with the remaining 1% contained within small zones peripheral to the three named zones. The DSZ and DFSZ are parallel to the DMZ and occur, respectively, 40 and 180 metres south of the DMZ. The DSZ varies in width from 10 to 40 metres and is approximately 2,000 metres in strike length. The DFSZ is 70-90 metres wide and is known to be at least 350 metres in length but remains open to the west.



Table 1: Dadiangou Inferred Resource estimate January 2008.
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Cutoff Grade Tonnes above Gold Grade Contained Ounces
(g/t gold) Cutoff (x1,000) (g/t) of Gold (x1,000)
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0.20 42212 0.683 926.3
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0.40 26318 0.919 777.6
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0.60 18045 1.114 646.0
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0.80 12354 1.309 520.1
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1.00 8429 1.503 407.4
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Within the Dadiangou Main Zone, a higher-grade core was modeled based on the coincidence of geological criteria with higher-grade assay intervals and the probability that certain favourable geologic criteria will be associated with higher grades. A relatively continuous higher-grade zone was thereby defined and separated out from the remainder of the shear zone. Results of the resource estimate within this higher-grade zone (Table 2) show that it contains 20% of the total gold at Dadiangou within only 7% of the total tonnage.



Table 2: Dadiangou higher-grade core zone
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Cutoff Grade Tonnes above Gold Grade Contained Ounces
(g/t gold) Cutoff (x1,000) (g/t) of Gold (x1,000)
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0.20 1908 2.482 152.2
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0.40 1908 2.482 152.2
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0.60 1907 2.483 152.2
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0.80 1907 2.483 152.2
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1.00 1892 2.495 151.8
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2.00 1189 3.041 116.2
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The resource estimate was prepared by Mario Rossi, M.Sc., Min.Eng., of Geosystems International Inc. and relies on data from Phase I and II diamond drilling (51 drillholes totaling 11,865 metres) and continuous channel sampling of 37 underground crosscuts. In total, 7,182 individual assays were used to build the Dadiangou resource model. Results at a number of possible cut-off grades are presented above. A cut-off grade of 0.4 g/t gold has been chosen as the base case most likely to approximate the economic cut-off of a potential open-pit operation.

The reported gold resources at Dadiangou are currently classed as Inferred based on Canadian Institute of Mining guidelines (CIM Standards on Mineral Resources and Reserves Definitions and Guidelines, August 2000). It is expected that a portion of these resources could be upgraded to the Measured and Indicated categories with additional information on the probable styles of mining and mineral processing.

A block model with nominal block size of 20 x 10 x 5 metres was used for grade estimation, although smaller blocks (down to 5 x 5 x 5 metres) were used in some cases to better define the shear zone contacts and higher grade zone. Gold grade inside the shear zone was estimated using ordinary kriging on 3 separate runs with increasing search radii (the long axis of the search ellipse was 30, 60, and 110 metres for runs 1 through 3) and using only data from within the shear zone. Grade outside the shear zone was estimated using data from only outside the shear zone but contributes less than 1% of the total estimated resource. Inside the shear zone gold grades were capped at 5 g/t and outside the shear zone at 2 g/t. A constant density of 2.78 tonnes/m3 was used and represents the average of 183 samples tested using industry standard wax coating method.

Quality Assurance and Quality Control Program

Industry standard core handling, sample chain of custody, and laboratory quality assurance/quality control (QAQC) procedures have been developed and followed during all work at the Dadiangou project. Individual core boxes are transported from the drill site to a secure core logging facility by Jinshan personnel. At the core shack, core is logged for geological and geotechnical purposes, then photographed prior to being cut by diamond saw for sampling. Blank, duplicate, and standard samples are inserted into the sample stream and comprise approximately 12% of the samples. A strict chain of custody protocol is enforced at all times during sample transport from the project to SGS-CSTC Laboratories in Tianjin, China (ISO 9001-2000 accredited). Once results are received, they are compiled with the drill hole data then reviewed and approved by all Qualified Persons.

Qualified Persons

Mario Rossi, M.Sc., Min.Eng., of Geosystems International Inc. is the Independent Qualified Person as defined by National Instrument 43-101 and is responsible for the Dadiangou resource estimate. Mr. Rossi has visited the Dadiangou site and audited the ongoing exploration program and has reviewed the results within this release. Howard Davies, M.Sc., M.A.I.G., a Jinshan employee, and Keith Patterson, M.Sc., P.Geo., Jinshan's Vice President of Exploration, are Qualified Persons responsible for fieldwork at the Dadiangou project. Both Mr. Davies and Mr. Patterson have supervised the work onsite and have reviewed the results reported in this release.

About Jinshan

Jinshan is a Canadian mining company focused on gold production in China. The company is actively advancing its portfolio of gold exploration properties and evaluating new gold opportunities in China.

Forward-Looking Statements: Statements in this release that are forward-looking statements, including the ongoing and planned exploration programs, the planned economic analysis, the upgrade of a portion of the reported inferred resources to the measured and indicated category and the development of the Dadiangou project into an open-pit are subject to various risks and uncertainties concerning the specific factors disclosed under the heading "Risk Factors" and elsewhere in the company's MD&A, financial statements and other periodic filings with Canadian securities regulators. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. When used in this document, words such as "could", "planning", "estimate", "expect", "intend", "may", "potential", "should", and other similar expressions are forward looking statements. The company does not assume the obligation to update any forward-looking statement.

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