Palmarejo Silver and Gold Corporation
TSX VENTURE : PJO

Palmarejo Silver and Gold Corporation

July 13, 2005 09:49 ET

Palmarejo: New Guadalupe Project Yields Excellent Drill Results

LONGUEUIL, QUEBEC--(CCNMatthews - July 13, 2005) - Palmarejo Gold Corporation (TSX VENTURE:PJO) is pleased to announce excellent results from the first drilling program at the Guadalupe Silver-Gold Project in the Temoris District, Chihuahua, Mexico. For more information about the project, please refer to the NI 43-101 Technical Report dated December 10, 2004 available at www.sedar.com under Palmarejo Gold Corporation.

The Guadalupe Project is approximately 7 kilometres southeast of the Palmarejo Project on the 100% owned San Carlos tenement and is within the Trogan exploration licence area held by the Corporation's 100% subsidiary, Planet Gold SA de CV ('Planet Gold').

The first drilling program, comprising 17 reverse circulation ('RC') and 6 diamond core holes, was completed on July 6, 2005. Assay results have been received for the first 6 RC holes. Full details are listed below, but some highlights include:

- 18.3 metres @ 0.3 g/t Au and 217 g/t Ag (3.6 g/t AuEq) (TGDH001)

- 3.0 metres @ 0.9 g/t Au and 286 g/t Ag (5.3 g/t AuEq) (TGDH002)

- 6.1 metres @ 0.1 g/t Au and 502 g/t Ag (7.8 g/t AuEq) (TGDH003)

The Guadalupe Project consists of a series of northeast dipping quartz veins that can be traced for 1,500 metres along strike with the northern portion of the structure known as Guadalupe and the southern portion known as Las Animas.

Diamond core drilling commenced on June 23, 2005 and 6 holes have been completed, including 3 diamond tails of RC drill holes. Both the Guadalupe and Las Animas structures have only been tested to a maximum depth of 50 metres below natural surface. Diamond core drilling will continue to test the down-dip and strike extents of the Guadalupe structure.

Surface mapping and observation indicates that this outcropping and near surface mineralisation is very high in the epithermal system and higher than at the Palmarejo Project. As a consequence, a predominance of silver over gold is expected at the higher levels of the system and gold grades are anticipated to increase with depth in the system. Mineralisation has been identified in black sulphide bands hosted within a multi-phased hydrothermal quartz vein breccia.

The best results were obtained in drill holes 1 to 3 on the Guadalupe structure where the 'clavo' (mineralised shoot) is up to 10 metres wide.

RC hole TGDH002 was abandoned due to high water inflow prior to intersecting the main Guadalupe structure but a 3 metre wide stockwork in the hanging wall returned 3 metres @ 0.9 g/t Au and 286 g/t Ag (5.3 g/t AuEq). Drill hole TGDH 002 has been extended with core and intersected the main Guadalupe structure from 70 metres.

Results from the Las Animas structure are encouraging. Holes 4 to 6 intersected a narrow part of the 'clavo' only 25 metres below natural surface. Subsequent drilling down dip of these holes has shown that the structure widens at depth.

Tables are available at the following address:

http://www2.ccnmatthews.com/database/fax/2000/pjo0713.pdf



Notes:

- Assays have been calculated using a 1.0 g/t AuEq cut
off, no top cut and a gold to silver price ratio of 1:65.
- The internal voids are historic underground workings and
have been excluded from the mineralised intervals reported above.
- Results are awaited for RC drill holes TGDH007 to TGDH017.
- Results are awaited for diamond core drill holes TGDH002D,
TGDH007D, TGDH014D and TGDH018 to TGDH020D.
- QVBX equals quartz vein breccia.


Qualified Person

The technical information contained in this release was compiled in accordance with the Listing Rules of the Australian Stock Exchange Limited, by a competent person who is a corporate member of the Australasian Institute of Mining and Metallurgy and who has consented to the inclusion of such technical information in the form in which it appears in this release. The competent person is Kenneth M. Phillips, geologist of VOP Mining Services Pty Ltd who is also a director of Bolnisi Gold NL, the Corporation's majority shareholder. Mr. Phillips is a qualified person under Canadian Securities Administrators National Instrument 43-101 ("NI 43-101").

Forward-looking statement

Some of the statements contained in this press release are forward-looking statements. Forward-looking statements are not historical facts, and are subject to a number of risks and uncertainties beyond the Corporation's control, including statements regarding completion of work program and studies, potential mineralization, exploration results and future plans and objectives of the Corporation. Resource exploration, development, and operations are highly speculative, characterized by a number of significant risks, which even a combination of careful evaluation, experience and knowledge may not eliminate, including, among other things, unprofitable efforts resulting not only from the failure to discover mineral resources but from finding mineral deposits which, though present, are insufficient in quantity and quality to return a profit from production. There can be no assurance that such statements will prove to be accurate and actual results could differ materially from those suggested by these forward-looking statements for various reasons discussed throughout the Corporation's filing statement dated March 14, 2005, and particularly in the section entitled "Risk Factors".

Additional information is available on SEDAR (www.sedar.com) and on the Corporation's website (www.palmarejogold.com).

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