SOURCE: Silver Dragon Resources Inc.

June 22, 2006 08:00 ET

Silver Dragon Resources Inc. Exploration Update at Cerro las Minitas Silver Mine, Durango, Mexico

TORONTO -- (MARKET WIRE) -- June 22, 2006 -- June 22, 2006 - Silver Dragon Resources Inc. (OTCBB: SDRG) is pleased to announce preliminary assay results from the upper 319.5 meters of its first drill hole (Drill Hole LM-01) located in the Puro Corazon area of its Cerro Las Minitas project in Durango, Mexico. Drill Hole LM-01 was drilled to 405.4 meters with a combination of reverse-circulation hammer drilling and HQ core. In the first 319.5 meters of the hole, seven mineralized intervals have now been identified by core and cuttings examination and assays that have been returned. Five additional strongly mineralized intervals were cut below 319.5 meters, ranging in length between 2.10 to 16.9 meters, but assays have not yet been returned for those samples.

The two uppermost mineralized intervals were cut at high elevation and are very strongly oxidized and leached. Residual metal values in these intervals are indicative of mineralization below that has not yet been tested otherwise by drilling. Interval LM-01-1 (from 86 - 94 meters down-hole) was 6 meters in length and yielded anomalous values in Ag (up to 25.5 g/ton), Cu (up to 693 ppm), Pb (up to 1.54%) and Zn ( up to 5460 ppm).

Interval LM-01-2 (from 115.5 - 125.85 meters down-hole) was 10.35 meters in length and cut highly oxidized and leached mineralization associated with an intrusive breccia. Assays of this interval yielded anomalous values in Ag (up to 91.7 g/ton), Cu (up to 1740 ppm), Pb (up to 1.21%) and Zn (up to 1.02%). The residual metal values in this interval are indicative of untested mineralization at depth. This interval has been identified as the El Sol zone, which has produced Ag, Pb and Zn at other locations along strike.

Interval LM-01-3 (from 257.85 - 267.15 meters down-hole) was 9.3 meters in length and cut sulfide mineralization associated with skarn alteration. Assays in the interval yielded values in Ag (up to 277 g/ton), Cu (up to 3.37%), Pb (up to 9.81%) and Zn (up to 18.3%).

Interval LM-01-4 (from 270.6 - 279.4 meters down-hole) was 8.8 meters in length and cut sulfide mineralization associated with skarn alteration. Assays in the interval yielded values in Ag (up to 129 g/ton), Cu (up to 3390 ppm), Pb (up to 6.2%) and Zn (up to 4.76%).

Interval LM-01-5 (from 290.55 - 291 meters down-hole) was 0.45 meters in length and cut sulfide mineralization associated with skarn alteration. Assays in the interval yielded values in Ag (up to 275 g/ton), Cu (up to 2.23%), Pb (up to11.2%) and Zn (up to 9.6%).

Interval LM-01-6 (from 308 - 308.55 meters down-hole) was 0.55 meters in length and cut sulfide mineralization associated with skarn alteration. Assays in the interval yielded values in Ag (up to 147 g/ton), Cu (up to 1830 ppm), Pb (up to 3.91%) and Zn (up to 5.30%).

Interval LM-01-7 (from 310.35 - 314.60 meters down-hole) was 4.25 meters in length and cut sulfide mineralization associated with skarn alteration. Assays in the interval yielded values in Ag (up to 288 g/ton), Cu (up to 1.58%), Pb (up to 10.3%%) and Zn (up to > 30.0%).

Additional mineralized intervals were cut below 319.5 meters but assays have not been returned for those intervals yet. In general, the intervals cut below 319.5 meters were longer and more highly mineralized than those cut above. In drill hole LM-01, we are seeing a general increase in strength and grade of mineralization with depth, suggesting that the mineralization below the known workings may be higher in grade than what has been mined at Puro Corazon to date.

More complete reporting of assay results from drill hole LM-01 will be made when all assays have been returned and the data from the drill hole has been more thoroughly analyzed. Due to heavy demand for laboratory services, it may be another one to three weeks before that work can be completed.

Drilling has just been completed on drill hole LM-02 which was drilled to 421.4 meters. A previously unidentified mineralized zone was cut at high elevation in the hole, but the drill hole was generally disappointing as the target horizons appear to have been folded out of the drill section. Drilling of LM-03 has just begun.

Early results from drilling and field work suggest that mineralization occurs over a much larger area than has been previously considered at Cerro Las Minitas. No less than two separate episodes of mineralization have now been identified. The first is closely related to skarn formation and is generally found close to the main intrusive contact. The second episode of mineralization is considerably more widespread and appears to contain higher silver grades. Surface and underground mapping, sampling and analysis are now focused to determine the controls of this second episode of mineralization. That style of mineralization has now been seen to occur over 150 meters away from the intrusive contact and field data suggest that it may extend considerably farther out.

Preliminary work in the La Piña -- La Bocona area of the property indicates that there may be a substantial zone of higher-grade silver mineralization (300 - 600 g/ton Ag) in that area. The mineralization that is being discovered there appears to be more characteristic of the second mineralizing episode than the earlier skarn. Preliminary field work in that area has identified two large mineralized chimneys that appear to be largely un-mined. A crew is being assembled to put a strong focus on that area.

Mr. Douglas R. Wood, P. Geo., a "qualified person" within the meaning of NI 43-101, prepared the technical information disclosed in this news release.

About Silver Dragon

Silver Dragon Resources Inc. is a mining and metal company focused on the exploration, acquisition, development and operation of silver mines in proven silver districts globally. Silver Dragon's objective is to acquire silver mining assets that contain promising exploration targets, have highly leveraged, out-of-the-money silver deposits, and/or producing properties with significant untapped exploration potential. It is management's objective to grow Silver Dragon into a significant silver producer by developing the Cerro las Minitas and the Erbahuo projects in Mexico and China. For more information, please visit the Company's website at: www.silverdragonresources.com (now available in Chinese).

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained herein which are not historical are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, certain delays beyond the company's control with respect to market acceptance of new technologies or products, delays in testing and evaluation of products, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.

Contact Information

  • Contact:
    Silver Dragon Resources Inc.
    Marc Hazout
    (416) 661-4989