Valencia Ventures Inc.
TSX VENTURE : VVI

Valencia Ventures Inc.

March 27, 2008 16:10 ET

Valencia Upgrades Mineral Resource at Cachinal Silver Project and Commences Drilling for Resource Expansion

TORONTO, ONTARIO--(Marketwire - March 27, 2008) - Valencia Ventures Inc. (TSX VENTURE:VVI) is pleased to announce an independent NI43-101 compliant mineral resource estimate for the Cachinal Silver Project has been completed by SRK Consulting (Canada) Inc. ("SRK"). The SRK resource estimate has upgraded the level of confidence of the previous resource estimate produced in February 2007. SRK have also identified 12 exploration target areas with the potential to add significantly to the current mineral resource.

Highlights:

March 27, 2008 SRK Mineral Resource Statement:

- Mineral Resource Estimate:

-- Indicated Mineral Resource:

--- 5.7Mt grading 101g/t silver, 0.13g/t gold and 0.22% zinc (18.41 MOz silver)

-- Inferred Mineral Resource:

--- 0.8Mt grading 115g/t silver, 0.12g/t gold and 0.22% zinc (3.02 MOz silver)

- Mineral Potential-Exploration Targets:

-- Open pit mineral potential (to 150m depth):

--- 1.14 - 2.82Mt grading between 80-120g/t silver (2.9 - 10. 9 MOz silver)

-- Underground mineral potential (below 150m to a depth of 250m):

--- 0.2Mt grading between 144-216g/t silver (0.3 - 1.5 MOz silver)

SRK have recommended a program of approximately 14,000m of additional drilling to evaluate the mineral potential of twelve exploration targets; this drilling will commence immediately with two drills arriving on site this week.

Doug Bache, Valencia's President & CEO, commented, "SRK's updated mineral resource estimate confirms Valencia's view that the Cachinal Silver Project contains a sizeable silver resource that holds the potential for a viable mine. The classification of the majority of the mineral resource in the Indicated classification has significantly increased our level of confidence in the Cachinal Project. SRK's work also proposes a follow up drill program to further expand and upgrade the resource at Cachinal. Our focus in the short term will be to evaluate the mineral potential offered by these targets and accelerate exploration on other targets outside of the current resource area." He added, "We continue to build our position in Chile and have commenced exploration on our recently acquired Juncal Project."

Mineral Resource Estimate:

The March 27, 2008 SRK Mineral Resource Statement for the Cachinal Silver Deposit is summarized in the following table:



Table 1
Mineral Resource Statement - March 27, 2008(i)
SRK Consulting (Canada) Inc
Sections 1250NNW - 1000SSE

---------------------------------------------------------------------------
Grades Contained Metal
Resource Quantity -----------------------------------------------
Classification (Mt) Silver Gold Zinc Silver Gold Zinc
(g/t) (g/t) (%) (Moz) (000 Oz) (Mlbs)
---------------------------------------------------------------------------
Indicated
---------------------------------------------------------------------------
OpenPit(1) 5.50 99 0.13 0.21 17.49 23.00 25.97
---------------------------------------------------------------------------
Underground(2) 0.15 188 0.21 0.52 0.92 1.02 1.75
---------------------------------------------------------------------------
Total 5.66 101 0.13 0.22 18.41 24.03 27.72
---------------------------------------------------------------------------
Inferred
---------------------------------------------------------------------------
OpenPit(1) 0.45 61 0.07 0.13 0.88 1.01 1.26
---------------------------------------------------------------------------
Underground(2) 0.37 180 0.19 0.34 2.14 2.25 2.77
---------------------------------------------------------------------------
Total 0.82 115 0.12 0.22 3.02 3.26 4.03
---------------------------------------------------------------------------

(i) Mineral Resources are not Mineral Reserves and do not have demonstrated
economic viability. All figures are rounded to reflect the accuracy of
the estimates. The cut-off grades are based on metal price assumptions
of US$12.50 per oz silver, US$650 per oz gold and metallurgical
recoveries of 85% for silver and gold. Zinc does not contribute to
revenues.
(1) Reported at a cut-off of 40g/t AgEq to a vertical depth of 150m below
surface assuming an open pit mining scenario.
(2) Reported at a cut-off grade of 150g/t AgEq below a vertical depth of
150m assuming an underground mining scenario.


Mineral Potential of Exploration Targets:

The geological and mineral resource models were reviewed by SRK to identify any potential target areas and to assist Valencia management to prioritize future exploration drilling programs. The zone of silver mineralization defined by Valencia at Cachinal is open to the north and at depth beneath the current resource model. SRK have also identified additional target zones along the western boundary of the Northern Extension block where no drilling has tested for parallel silver-bearing structures. The summary statement of mineral potential is expressed explicitly on the basis that the potential range of quantity and grade are conceptual in nature, there has been insufficient exploration to define a mineral resource and, it is uncertain if additional drilling will result in the delineation of a mineral resource on the targets.

The mineral potential is identified in 12 exploration drilling targets (Figure 1). Each target was assessed in terms of size, quality of the potential silver vein mineralization and potential quantities and grades (Table 2). After review, SRK estimates that approximately 100 drillholes (14,000 metres) will be required to adequately test these targets.



Table 2
Summary
Mineral Potential - Exploration Targets
SRK Consulting (Canada) Inc - March 27, 2008

----------------------------------------------------------------------------
Target Type Potential Quantity Potential Potential Metal
Grade
----------------------------------------------------------------------------
Tonnes Silver (g/t) Silver (M Oz)
----------------------------------------------------------------------------
Min Max Min Max Min Max
----------------------------------------------------------------------------
Open Pit Target (Surface to 150m)
----------------------------------------------------------------------------
Vein Extension Targets 620,000 1,650,000 80 120 1.59 6.37
----------------------------------------------------------------------------
New Vein Targets 400,000 960,000 80 120 1.03 3.70
----------------------------------------------------------------------------
Upgrade Vein Targets 120,000 210,000 80 120 0.31 0.81
----------------------------------------------------------------------------
Total 1,140,000 2,820,000 80 120 2.93 10.88
----------------------------------------------------------------------------
Underground Target (150 - 250m)
----------------------------------------------------------------------------
Vein Extension Targets 50,000 130,000 144 216 0.19 0.90
----------------------------------------------------------------------------
New Vein Targets 30,000 80,000 144 216 0.32 1.46
----------------------------------------------------------------------------
Upgrade Vein Targets
----------------------------------------------------------------------------
Total 80,000 210,000 144 216 0.32 1.46
----------------------------------------------------------------------------

NB: The reported ranges of potential quantity & grade are conceptual in
nature, there has been insufficient exploration to define a mineral
resource and it is uncertain if further exploration will result in
determination of a mineral resource. The reported mineral potential is
expressed as ranges of tonnage and grade based on sampling data,
interpreted continuity and range of thicknesses for each vein structure.
Potential quantity range is derived from the ratio between the tonnage
of each vein structure and tonnage above cut-off in the Cachinal mineral
resources, 44 and 5 percent for open pit and underground resources,
respectively. Ranges of grade are based on ranges about the mean
resource grade. Targets from surface to a depth of 150m are considered
conceptual open pit targets; targets between 150-250m are considered
conceptual underground targets.


SRK Qualifications and Methodology of Resource Estimation

SRK is part of an international company with over 700 engineers and scientists worldwide performing independent engineering, environmental and geological consulting to the minerals industry. They have a reputation for their excellence in estimation of mineral resources.

In September 2007 Valencia engaged SRK to prepare an updated mineral resource estimation and to initiate mine design and engineering studies required to assist with preliminary economic assessment and subsequent feasibility analysis of the Cachinal Silver Project. The principal project team based in Toronto, Canada, visited the Cachinal project in October 2007 during the Definition Drilling Phase of the 2007 exploration program. The SRK team also included hydrology, environmental assessment and tailings design specialists from the SRK Santiago office.

The independent mineral resource estimate prepared by SRK is reported in accordance with Canadian Securities Administrators' National Instrument 43-101 and conforms to generally accepted Canadian Institute of Mining ("CIM") "Estimation of Mineral Resources and Mineral Reserves Best Practices" guidelines. A complete National Instrument 43-101 Technical Report, which will incorporate the resource estimation, will be filed on Sedar within 45 days of release of this press release.

The resource estimate is based on a three dimensional (3-D) geological interpretation of the mineralization that integrated information from 22,780m of reverse circulation (RC) drilling in 176 drillholes, 588m of drill core from five diamond drill holes, and 36 surface trenches over a strike length of 2,250 metres.

The geological interpretation identified 11 independent veins with 3,240 mineralized intersections which have been composited and incorporated into the block model. A density factor of 2.43 tonnes per cubic metre was used to convert volumes into tonnage. The resource estimate included all blocks from surface to a depth of approximately 250 metres below surface. The impact of mined-out vein areas was considered at the geological modelling stage; modelled veins are considered as remnants of the veins left behind after historical mining.

The Cachinal block model was created using Datamine with 3x5x5m blocks. Block grades were estimated using ordinary kriging methodology. Resource blocks situated within the primary ranges defined by variography are assigned to the Indicated classification; all other resource blocks within three times the maximum variography ranges are assigned an Inferred classification. Variograms suggest that a drill spacing of 25 - 30m should allow conversion of Indicated Resources to the Measured Resource category.

SRK have reported the mineral resources at two cut-off grades to reflect a "reasonable prospect" of extracting the upper 150m of the deposit as an open pit mine and the deeper portions of the deposit using underground mining methods (Table 1). To test the "reasonable prospects for economic extraction", SRK designed a series of conceptual pit shells using Lerchs-Grossman optimisation parameters based on on-going evaluations undertaken by SRK on the Cachinal project. After review of several scenarios considering different metal prices, design criteria and operating cost assumptions, SRK concluded that the portion of the Cachinal deposit between surface and approximately 150m below surface shows "reasonable prospect" for economic extraction via open pit mining and that mineralization located below that depth is amenable to underground mining.

Open pit mining resources are reported at a cut-off of 40g/t AgEq whereas mineral resources below the 150m depth are reported at a cut-off of 150g/t AgEq. The silver equivalent ("AgEq") grades are calculated using a gold to silver ratio of 50:1, metal prices of US$12.50per ounce silver and US$650 per ounce gold, and a recovery of 85% for both gold and silver; zinc does not contribute to revenues.

The mineral resources are sensitive to the selection of cut-off grade. To illustrate this, global tonnage and grades at various cut-off grades for open pit and underground resources are presented in Tables 3A and 3B, respectively.



Table 3A
Global Block Model Quantity & Grades Estimates(i) at Various Silver
Equivalent Cut-off Grade
Surface to 150m Depth - Sections 1250NNW - 1000SSE
SRK Consulting (Canada) Inc - March 27, 2008

-----------------------------------------------------------------------
-----------------------------------------------------------------------
Cut-off Quantity Grades Contained metal
AgEq Silver Gold Zinc Silver Gold Zinc
g/t (Mt) (g/t) (g/t) (%) (Moz) (000'oz) (Mlbs)
-----------------------------------------------------------------------
Indicated
20 8,863,940 72 0.1 0.19 20.42 28.50 36.51
-----------------------------------------------------------------------
40 5,503,517 99 0.13 0.21 17.49 23.00 25.97
-----------------------------------------------------------------------
50 4,492,390 112 0.15 0.22 16.15 21.67 22.10
60 3,755,606 124 0.16 0.23 14.94 19.32 19.34
80 2,693,316 147 0.19 0.25 12.73 16.45 15.07
100 2,011,371 169 0.21 0.26 10.90 13.58 11.47
120 1,458,548 194 0.24 0.26 9.08 11.25 8.45
140 1,091,204 218 0.26 0.27 7.64 9.12 6.61
150 955,903 229 0.28 0.28 7.04 8.61 5.89
160 837,470 241 0.29 0.28 6.49 7.81 5.25
200 541,515 281 0.34 0.31 4.89 5.92 3.74
-----------------------------------------------------------------------
-----------------------------------------------------------------------

-----------------------------------------------------------------------
-----------------------------------------------------------------------
Cut-off Quantity Grades Contained metal
AgEq Silver Gold Zinc Silver Gold Zinc
g/t (Mt) (g/t) (g/t) (%) (Moz) (000'oz) (Mlbs)
-----------------------------------------------------------------------
Inferred
20 823,916 46 0.06 0.13 1.21 1.59 2.35
-----------------------------------------------------------------------
40 448,005 61 0.07 0.13 0.88 1.01 1.26
-----------------------------------------------------------------------
50 210,951 84 0.11 0.16 0.57 0.75 0.74
60 150,874 96 0.14 0.17 0.47 0.68 0.55
80 91,895 119 0.15 0.19 0.35 0.44 0.39
100 57,857 139 0.15 0.20 0.26 0.28 0.26
120 42,425 152 0.16 0.20 0.21 0.22 0.18
140 20,659 181 0.21 0.28 0.12 0.14 0.13
150 19,233 184 0.21 0.28 0.11 0.13 0.12
160 15,073 194 0.23 0.29 0.09 0.11 0.10
200 7,396 223 0.26 0.31 0.05 0.06 0.05
-----------------------------------------------------------------------
-----------------------------------------------------------------------


(i) The reader is cautioned that the figures presented in these tables
should not be misconstrued as mineral resource statements. The reported
quantities and grades are only presented as a sensitivity of the
resource model to the selection of cut-off grade.



Table 3B
Global Block Model Quantity & Grades Estimates(i) at Various Silver
Equivalent Cut-off Grade
Below 150m Depth - Sections 1250NNW - 1000SSE
SRK Consulting (Canada) Inc - March 27, 2008

-----------------------------------------------------------------------
-----------------------------------------------------------------------
Cut-off Quantity Grades Contained metal
AgEq Silver Gold Zinc Silver Gold Zinc
g/t (Mt) (g/t) (g/t) (%) (Moz) (000'oz) (Mlbs)
-----------------------------------------------------------------------
Indicated
20 1,764,245 64 0.09 0.26 3.65 5.10 9.99
40 1,127,708 86 0.12 0.29 3.12 4.35 7.17
50 957,247 94 0.13 0.29 2.90 4.00 6.09
60 814,347 102 0.13 0.30 2.67 3.40 5.35
80 526,786 122 0.15 0.33 2.07 2.54 3.88
100 307,567 149 0.17 0.43 1.48 1.68 2.92
120 212,134 170 0.19 0.49 1.16 1.30 2.30
140 165,949 184 0.21 0.52 0.98 1.12 1.91
-----------------------------------------------------------------------
150 151,618 188 0.21 0.52 0.92 1.02 1.75
-----------------------------------------------------------------------
160 114,923 203 0.19 0.48 0.75 0.70 1.22
200 36,795 285 0.16 0.37 0.34 0.19 0.30
-----------------------------------------------------------------------
-----------------------------------------------------------------------

-----------------------------------------------------------------------
-----------------------------------------------------------------------
Cut-off Quantity Grades Contained metal
AgEq Silver Gold Zinc Silver Gold Zinc
g/t (Mt) (g/t) (g/t) (%) (Moz) (000'oz) (Mlbs)
-----------------------------------------------------------------------
Inferred
0 6,899,503 39 0.06 0.17 8.73 13.31 25.45
40 2,632,133 83 0.13 0.27 7.01 11.00 15.61
50 2,043,557 95 0.14 0.29 6.22 9.20 13.08
60 1,736,667 102 0.16 0.31 5.71 8.93 11.84
80 1,280,758 116 0.17 0.34 4.78 7.00 9.64
100 662,241 149 0.18 0.31 3.17 3.83 4.51
120 477,208 167 0.18 0.31 2.56 2.76 3.23
140 382,796 179 0.19 0.34 2.20 2.34 2.85
-----------------------------------------------------------------------
150 368,585 180 0.19 0.34 2.14 2.25 2.77
-----------------------------------------------------------------------
160 254,657 196 0.17 0.39 1.60 1.39 2.21
200 153,057 214 0.15 0.41 1.06 0.74 1.40
-----------------------------------------------------------------------
-----------------------------------------------------------------------

(i) The reader is cautioned that the figures presented in these tables
should not be misconstrued as mineral resource statements. The reported
quantities and grades are only presented as a sensitivity of the
resource model to the selection of cut-off grade.


SRK is satisfied that the disclosure of mineral potential for twelve exploration targets (Table 2, above) follows the National Instrument 43-101 guidance in relation to mineral disclosure of exploration targets. The summary statement of mineral potential presented in Table 2 is expressed explicitly on the basis that the potential range of quantity and grade are conceptual in nature; there has been insufficient exploration to define a mineral resource and it is uncertain if additional drilling will result in the delineation of a mineral resource at the targets.

The mineral potential is expressed as a range of quantity and grade and is only recognised where supported by one or more intersections with grade and width that meet current economic parameters for a mineral resource, or where the lateral extent of mineralisation is supported by physical sampling that indicates economic parameters will be met, or where the lateral extent of mineralisation is known and its characteristics may be assessed on the basis of immediately adjacent similar, economically delineated mineralisation. In assessing the mineral potential, the potential ranges of quantity and grades were evaluated on the basis of potential silver mineralization above the respective cut-off grades used for reporting mineral resources for this deposit.

Cachinal Silver Project

The Cachinal Silver Deposit is a low-sulfidation, structurally controlled silver (gold-zinc) deposit located within the Paleocene Gold Belt of northern Chile which hosts several significant gold and silver deposits including Yamana Gold Inc's El Penon Silver-Gold Mine, 60km to the northeast, a low sulphidation-style epithermal silver-gold deposit and one of the world's lowest cost gold producers.

Silver mining began at Cachinal in 1862 and historical production is estimated at approximately 32 million ounces of silver. Extensive historic workings at Cachinal reportedly extend to a depth of 320m although most of the workings only went to a depth of 120-150m, generally within the oxidized zone. Historical grades apparently averaged 500-600g/t silver with an unknown quantity of trace gold, with some local values of up to 2500g/t silver and as much as 3g/t gold reported. The production figures (tonnage and grade) referred to above are historical in nature and have not been verified by Valencia's Qualified Person, and should not be relied upon.

Valencia commenced exploration of the Cachinal project in 2004 and announced the first National Instrument 43-101 compliant mineral resource estimate in February 2007. Early in 2007, step-out exploration drilling successfully located new potential "resource grade" mineralized intersections over a strike length of over 1,200 metres to the north and several hundred meters to the south of the 2006 resource area. Detailed resource definition drilling has now been completed over a strike length of approximately 2250m, and the zone is still open along strike to the north and at depth.

During 2007, Valencia completed expenditure obligations in respect of the Silver Standard JV and in July negotiated an agreement to purchase a 100% interest in the Cachinal property, which hosts the delineated mineral resource.

About Valencia Ventures

Valencia is a Canadian resource company traded under the symbol VVI on the TSX Venture Exchange. Valencia's development strategy is focused on the exploration and development of silver and gold properties, including the Cachinal and Juncal silver projects in Chile and the Rancheria silver project in the Yukon Territory and British Columbia, Canada. With a focus on silver and gold exploration in the Americas, the Company also has a number of property acquisitions under consideration.

For additional information on this press release or Valencia's projects, please visit www.valenciaventures.com.

Regulatory Footnotes:

Mr. Douglas A. Currie, MAusIMM, Valencia's Executive Vice President-Exploration & Development, is the Qualified Person as defined under National Instrument 43-101 responsible for the scientific and technical work on the exploration program and has reviewed the technical disclosure in this press release.

The NI43-101 mineral resource estimation, contained herein, was completed by Mr Glen Cole, P. Geo., Principal Resource Geologist, assisted by Dr Jean-Francois Couture, P. Geo., Principal Consultant, both of SRK Consulting (Canada) Inc., Toronto, Ontario. By virtue of their backgrounds and professional experience, Mr Cole and Dr Couture are "Qualified Persons" as defined by NI43-101.

This press release contains "forward-looking information" within the meaning of applicable securities legislation. Forward-looking information includes, but is not limited to, statements regarding exploration prospects, the identification of mineral resources, costs of and capital required for exploration projects, exploration expenditures and timing of future exploration and the costs and timing of additional exploration activities on the property. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, political and social uncertainties; the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters, future prices of mineral prices; and risks of the mining industry. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

To view the map titled, "Drilling Targets Cachinal Project, Chile", please visit the following link: http://media3.marketwire.com/docs/vvimap327.pdf

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