Sinchao Metals Corp.

Sinchao Metals Corp.

December 21, 2006 09:00 ET

Sinchao Metals Announces Listing on the TSX Venture Exchange and Updates the 2006 Exploration Program

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Dec. 21, 2006) - Sinchao Metals Corp. (TSX VENTURE:SMZ) is pleased to announce that its common shares will be listed under the symbol SMZ and will commence trading on the TSX Venture Exchange (the Exchange) at the opening on December 21, 2006. The Exchange Bulletin has been issued on December 20, 2006.

"We are pleased to have reached this significant landmark in the growth and development of Sinchao", states Chairman John Huguet, "and anticipate notable progress over the next 12 months."

"The company can now move forward with the exploration and drilling programs", adds President Andrew Gourlay, "and continue to define the remarkable potential of this project."

Sinchao Metals Corp. owns 100% interest of the Sinchao polymetallic property, which is located in Cajamarca Province, Northern Peru, and 30 kilometres from Yanacocha, the largest gold mine in South America. The Sinchao Property was recently sold to Sinchao Metals by Andean American Mining Corp. (TSX VENTURE:AAG)(FWB:AQN) who remains its principal shareholder with 74% of its common shares.

The Company is also pleased to provide an outline of recent exploration and planned drilling activities for the upcoming season.

Andean American Mining Corp. has held the Sinchao Property since 1996. Initial geological mapping, surface sampling, Induced Polarization and magnetometer surveys were completed in 1996, followed by over 8000 metres of drilling during 1997 and 1998. Results were very encouraging, however, metal prices were at all time lows and exploration was halted. Since 1998, Andean American has continued to consolidate its land position, which it completed in early 2006. As part of this process, Andean American acquired 21 hectares contiguous with the existing Sinchao Property in 2005 from ABX-PERU, a subsidiary of Barrick Gold Corp. (TSX:ABX) (NYSE:ABX)(LSE:BGD).

The 1998 exploration program identified four mineralized systems on the Sinchao Property: the Skarn Zone, the Breccia Zone, the High Sulphidation Epithermal Zone and the Massive Sulphide Lenses. The Skarn Zone and the Breccia Zone each have the potential to host more than 500 million tonnes of mineralization.

1998 Diamond Drilling
Significant Results

Hole From To Drill Zone Cu Au Ag Zn
Intersection % % % %
(m) (m) (m)

SDH-06 356 452 96 Skarn 0.29% 0.72 6.49 0.92%
Cu g/t Au g/t Ag Zn

SDH-06 430 530 100 Skarn 0.41% 0.22 4.67 0.21%
Cu g/t Au g/t Ag Zn

SDH-02 300 476 176 Breccia 0.47% 0.45 8.84 0.13%
Cu g/t Au g/t Ag Zn

SDH-05 230 456 226 Breccia 0.69% 0.41 17.16 0.33%
Cu g/t Au g/t Ag Zn

SDH-07 219 373 154 Breccia 0.68% 0.80 28.09 0.33%
Cu g/t Au g/t Ag Zn

SDH-08 486 516 30 Breccia 0.43% 0.26 24.00 0.01%
Cu g/t Au g/t Ag Zn

SDH-10 74 450 376 Breccia 0.43% 0.56 16.21 0.28%
Cu g/t Au g/t Ag Zn

These drill intersections have not been followed up.

Recently high-grade zinc mineralization was discovered within the Skarn Zone, where the four grab samples collected assayed 31.16%, 12.02%, 29.06% and 16.58% zinc, and a grab sample of massive galena also assayed 2.67 g/t gold, 147.0 g/t silver and 10.48% lead. The distribution of high-grade zinc and lead within the Skarn Zone is not well understood and there is excellent potential for high-grade lead-zinc skarn mineralization on the Sinchao Property

The proposed exploration program will attempt to define the size and grade of the potential bulk tonnage, open pittable resources of the Breccia and Skarn Zones. The extent of these two Zones is unknown, and both the Breccia and Skarn Zones will be systematically explored with an initial two-phase exploration and 5000 metre drill program.

In the 2006 Phase One program detailed mapping of the entire Sinchao Property, in conjunction with state of the art 3D Induced Polarization and ground magnetic surveys, has been completed. This work has extended the chargeability features associated with the Breccia Zone to the northwest, and has identified a distinct chargeability anomaly that appears to be related to the high-grade skarn mineralization. Negotiations are continuing to conclude a community agreement with the nearby communities.

Diamond drill testing of extensions of the Breccia Zone, as defined by the 1998 drill program, and the high-grade Skarn mineralization will commence with the signing of the community agreement. The drilling planned for Phase One will total approximately 2200 metres.

Phase Two will involve additional diamond drilling to further test the continuity and limits of the Breccia Zone, and the Skarn Zone. The amount of drilling for Phase two has not been fully defined but a minimum of 3000 meters of drilling is anticipated.

Andrew Gourlay, P. Geol. President, Sinchao Metals Corp. and Victor Jaramillo, P. Geo., Independent Consulting Geologist, of Discover Geological Consultants, both Qualified Persons as defined by National Instrument 43-101, supervised the preparation of the technical information in this release.

On behalf of the Board of Directors of Sinchao Metals Corp.

Andrew W. Gourlay, President

About Sinchao Metals Corp:

Sinchao Metals Corp. is focused on the exploration and development of the Sinchao property, located in Cajamarca province in Northern Peru, 30 kilometres from Yanacocha, the largest gold mine in South America. The company is dedicated to creating value for its shareholders by pursuing growth, expansion and enhancement of the Sinchao property.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this news release.

Contact Information

  • Sinchao Metals Corp.
    Andrew W. Gourlay
    (604) 681-6186 or Toll Free: 1-888-356-4784
    (604) 681-3652 (FAX) (FAX)