TVI Pacific Inc.

TVI Pacific Inc.

September 20, 2005 10:12 ET

TVI Pacific: Rapu Rapu-Update

CALGARY, ALBERTA--(CCNMatthews - Sept. 20, 2005) - TVI Pacific (TSX:TVI):

- Commissioning of the Gold Plant finalized in late August

- Production in September on track to deliver approximately 2,700 ounces of gold and 12,000 ounces of silver

- Commissioning of the Base Metals Plant due in October

The Rapu Rapu project, located in the province of Albay, Philippines, is a polymetallic mining project which a group of companies including Lafayette Mining Limited, a publicly traded Australian company, is developing.

TVI retains a 2.5% net smelter return royalty (NSR) in the project.

The following is a verbatim reproduction from a Lafayette news release
issued on September 19, 2005

Lafayette Announces an A$8.0 Million Convertible Note Issue

Lafayette Mining Limited (Lafayette) today announced an A$8.0 million financing through the issue of Convertible Notes at A$1 each. The financing is being made by private placement and co-arranged by Australian-based Grange Securities (Grange) and North American-based Haywood Securities Inc. (Haywood).

Haywood is providing the offshore component of the placement and Grange the domestic component. The domestic component closed on Friday, 16 September 2005 and the offshore component will close soon.

"We are very pleased with the support in the market for this placement," said Lafayette's Managing Director, Andrew McIlwain.

The funds will be utilised for working capital requirements following the recent commissioning of the Gold Plant at the Rapu Rapu project in the Philippines, pre-development work at the nearby Hixbar deposit, and for the identification and development of new business opportunities.

"As part of our capital management programme, we were conscious of minimising dilution of shareholder interests with this raising and accordingly, we believe that convertible notes are an ideal instrument for our current funding requirements," said Mr McIlwain.

"We are at a very exciting phase in the development of the Rapu Rapu Project, with the Gold Plant operational and commissioning of the Base Metals Plant due in October."

The commissioning of the Gold Plant was finalised in late August with production in September on track to deliver approximately 2,700 ounces of gold and 12,000 ounces of silver as the plant ramps up to nominal capacity of 4,000 ounces gold and 16,000 ounces of silver per month.

While initial production from the Gold Plant was hampered by an unseasonably dry period where the availability of fresh water was limited, significant rainfall and catchment over the past week has alleviated this constraint. The performance in the open pit mine has been better than planned, with mined grades for the project to date at 2.24g/t - above the geological model's expectation of 1.75g/t.

"The Gold Plant will continue to operate whilst the Base Metals Plant is being commissioned during October. Importantly, this allows Lafayette to generate revenue during this commissioning period," Mr McIlwain said.

Commencement of treatment of base metals ore, producing a copper concentrate rich in gold and a separate zinc concentrate, comes at a time of strong gold and zinc prices and record high copper prices.

Terms of the notes:

The Convertible Notes, issued at A$1 each, have a four-year maturity and are convertible into shares at a price of $0.20 per share. The Notes will bear interest at the rate of 10.0% per annum and will be payable bi-annually, in arrears on 15 October and 15 April of each year in either cash or by the issue of shares. The first payment, together with accrued interest, will be paid on 15 April 2006. The Notes also carry a commodity price participation provision which entitles holders to receive their pro rata share of 1.0% of the revenue of the Company on its copper and gold sales when the London Metal Exchange sale price exceeds US$2.00/lb Cu and US$475/oz Au, respectively. Importantly, Lafayette has the flexibility to retire the Notes at any time after 30 September 2007, by either cash or the issue of shares.

"Lafayette's announcement is great news for TVI shareholders" said Clifford James, President and CEO of TVI Pacific Inc. "Precious metal production at Rapu Rapu means TVI will begin receiving cash payments without any costs from its 2.5% NSR royalty on the project. Under our royalty agreement the first quarterly payment is due at the end of October."

Ian Perry, P.Geo. of Norwest Corporation, serving as TVI's "Qualified Person" for purposes of National Instrument 43-101 - Standards of Disclosure for Mineral Deposits ("NI-43-101") on this project, has reviewed this press release.

The statements herein that are not historical facts are forward-looking statements. Forward-looking statements (often, but not always, identified by the use of words such as "expect", "may", "anticipate" or "will" and similar expressions) may include plans, expectations, opinions, or guidance that are not statements of fact. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. These statements are subject to certain risks and uncertainties that could cause actual results or outcomes to differ materially from those anticipated or implied by forward looking statements. TVI Pacific Inc. does not assume responsibility for the accuracy and completeness of the forward looking statements and, subject to applicable law, does not undertake any obligation to publicly revise such forward looking statements to reflect subsequent events or circumstances. The forward looking statements of TVI Pacific Inc. contained in this News Release are expressly qualified, in their entirety, by this cautionary statement.

The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.

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