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Andina Minerals Inc.

Published : May 29th, 2012

First Quarter 2012 Update

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Keywords :   Chile | Copper | Gold | Recovery | Water |

Andina First Quarter 2012 Update

ANDINA Minerals Inc. (TSXV: ADM) (�Andina� or the �Company") wishes to update the market on progress made during the first quarter of 2012 on the Company�s Volcan project.

�Our environmental permitting and engineering teams have made significant progress advancing their respective studies in 2012,� said George Bee, President and CEO.  �Our metallurgical work program in support of a feasibility study is complete and final reports are currently being drafted.  Preliminary indications suggest that grade recovery curves will be similar to that reported in the 2011 prefeasibility study.  The Environmental Impact Assessment (�EIA�) is substantially complete and we expect to submit it to the authorities in the second quarter of 2012 after we conclude discussions with both government agencies and local communities.  The feasibility study could be delayed as late as the first quarter of 2013, while the Company continues to optimize all aspects of the study, including sourcing of people, products and material which is taking longer than anticipated.�

Volcan Project Update:

         In January 2012, the Company reviewed and finalized a detailed project description of the Volcan Gold Project (�Volcan�) for its EIA and construction permit application, for the initial development plan.

o    Extensive metallurgical engineering studies to support a feasibility study for Volcan are now largely complete. These studies were aimed at optimizing reagent consumption and providing an acceptable level of detailed information for any independent engineer reviews.

o    Management has included a Sulphidation, Acidification, Recycling, and Thickening circuit into the Volcan project description to reduce operating costs and eliminate risk.

o    The project description now includes a combined mill-heap leach production rate of 60,000 tonnes of ore processed per day using the same or similar crushing equipment as identified in the prefeasibility study where total throughput was set at 55,000 tonnes per day.

o    Additionally, new processes to mitigate environmental risks associated with tailings have been added to the project description. These measures have been included to give comfort to stakeholders that Andina is proposing all reasonable measures, above and beyond those presented in the prefeasibility study, to save water, protect the environment and eliminate risk associated with the project.

         During the first quarter of 2012, the Company successfully completed a study linking idiosyncrasies in the Volcan geology and mineralogy to the metallurgical results that have been seen in the metallurgical test work conducted over the past three years.

o    The study has significantly advanced our knowledge of the Dorado ore bodies that form the Volcan project. The protocols developed are applicable to the wider geologic setting and give management confidence that Andina can manage a gold deposit in the area with minimal operational risk.

o    The Company has now developed a block-model that clearly identifies low pH material, thought to be associated with exotic sulphate salts, therefore further de-risking the planned selective mining and processing practices to be employed at Volcan.

o    Having now identified a limited horizon of low pH material at Volcan, the Company believes it can improve heap leach performance by now directing this material to either waste or the proposed mill where it can be effectively processed. The Company anticipates improvements in reagent consumption having developed a protocol to manage low pH material related to sulphate salts.

         The 2011/2012 Development Program Field Season was successfully completed in April 2012.

o    The Company�s objective was to gather the remaining essential data for the feasibility study. Information includes: detailed investigation and additional drilling to establish pit-slope angles, condemnation drilling under key project facilities, water well drill and pump test investigations to support the site hydro-geochemical and hydrological models, geotechnical and site foundation investigations.

         Feasibility Study Status:

o    We are currently evaluating the final results of the metallurgical program to confirm the optimal plant flowsheet and to finalize projected recoveries and reagent consumptions.

o    The geotechnical investigation has been completed on site for all the proposed site facilities.

o    Geotechnical drilling in the mine area to finalize the pit slopes is complete.

o    The general site layout has been finalized.

o    Preliminary engineering has been completed and general arrangements have been prepared along with the associated material takeoffs for the process plant.

o    Requests for quotations have been issued for all major equipment and quotations are in hand for approximately half of the items.

o    Contractor bid packages are being sent out to obtain preliminary prices for site construction.

o    Preliminary designs for the site infrastructure have been prepared and bid prices are being solicited for construction of these facilities as part of the general contractor bid packages.

o    The first draft of Volcan�s feasibility study is nearing completion and is expected for initial internal review around mid-year. It is anticipated that there will be several scope differences between the draft feasibility study and the prefeasibility study which was published in February 2011. The concept and scale of mineral processing is expected to be largely the same, employing a spilt leach and milling scenario, however, the intention is to increase the use of the equipment outlined in the prefeasibility study, with the anticipated result of higher throughput in the mill. The Company intends to take a more environmentally robust approach to tailings management and intends to move from thickened tailings envisioned in the prefeasibility study to dry stack tailings and to add a cyanide destruction circuit. These changes would likely be favorable for capital costs by reducing the need for tailings impoundment construction but will be offset due to the need for filtering equipment. The feasibility study is expected to include SART to control copper values in heap leach solutions, which if left unchecked would negatively impact cyanide consumption and therefore operating cost. The differences outlined above and inflation since publication of the prefeasibility study are anticipated to result in several changes to the economic metrics published in the prefeasibility study and as a consequence prior estimates should not be relied upon and should only be considered in the light of noted changes.

o    Based on the anticipated changes to the Volcan project description in comparison to the prefeasibility study and the current bearish climate for mining investment, the Company will use the coming months, while environmental permitting is advanced through the evaluation process, to refine and optimize the first draft of the feasibility study, including sourcing of people, products and material, which is taking longer than anticipated. The feasibility study could be delayed as late as the first quarter of 2013.

         The Company intends to delay its submittal of the EIA for Volcan until the end of the second quarter of 2012 in order to provide the Company additional opportunities to meet with governmental officials and communities prior to submittal.

         On January 1, 2012, Mr. Robert (Bob) Rose assumed the role of Chief Operating Officer for Andina.  Bob is a senior mine development professional who reinforces Andina�s internal team and will provide leadership in the preparation of the economic studies and development of Volcan.. It should be noted that Bob was the Project Manager for the Volcan Project in his former position with Kappes Cassidy & Associates and the transition has been seamless.

         In February 2012, Dr. Annick Chouinard assumed the role of Vice President of Exploration for Andina.  Annick is a senior geologist having extensive experience with epithermal sulphidation deposits.  Annick augments our existing geological team and, with the completion of Volcan�s feasibility study, will provide exploration leadership on Andina�s under-explored land holdings.

         As at March 31, 2012 the Company had working capital of $9.8 million and cash-on-hand of $14.3 million.

         First quarter net loss was $0.4 million, or $0.003 per share.

Dr. Annick Chouinard, Vice President of Exploration of Andina and a qualified person for the purposes of National Instrument 43-101 of the Canadian Securities Regulators, has reviewed the scientific and technical information contained in this press release.

About Andina Minerals Inc.

Andina�s primary focus is mining exploration and development in Chile.  The Company�s flagship development project is the 100%-owned Volcan Gold Project, strategically located in the prolific Maricunga Gold Belt.

In February 2011, Andina announced the results of a positive pre-feasibility study for the Dorado deposits of Volcan. Initial Proven and Probable Mineral Reserves are 6.6 million ounces of gold at an average grade of 0..73 g/t contained in 283 million tonnes of ore.  In addition, there remains 2.4 million ounces of Measured and Indicated gold resources at an average grade of 0.68 g/t contained in 110 million tonnes of ore plus 1.5 million ounces of gold in the Inferred category contained in 73 million tonnes of ore at an average grade of 0.65 g/t Au.

Andina is progressing with EIA submission in the second quarter of 2012 and finalization of a feasibility study for Volcan.

In addition to Andina�s extensive underexplored land position surrounding Volcan, the Company holds two other mineral properties located within Chile�s primary mining regions.


Data and Statistics for these countries : Chile | All
Gold and Silver Prices for these countries : Chile | All

Andina Minerals Inc.

CUSIP : 034219105
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Andina Min. is a gold and silver exploration company based in .

Andina Min. holds various exploration projects in Chile.

Its main exploration properties are ENCRUCIJADA, PAMPA BUENOS AIRES and VOLCAN in Chile.

Andina Min. is listed in Canada and in United States of America. Its market capitalisation is CA$ 102.1 millions as of today (US$ 99.4 millions, € 74.4 millions).

Its stock quote reached its lowest recent point on December 30, 2005 at CA$ 0.07, and its highest recent level on December 31, 2007 at CA$ 5.50.

Andina Min. has 129 271 000 shares outstanding.

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In the News and Medias of Andina Minerals Inc.
4/4/2006New analysis
Annual reports of Andina Minerals Inc.
2007 Annual report
2006 Annual report
Option Grants of Andina Minerals Inc.
4/26/2011Grants 80,000 Options to an employee
3/11/2010Grants 1,665,000 Options to officers, directors and employee...
3/6/2009Grants 500,000 Options to Mr. Keith McKay and 200,000 to Mr....
5/10/2007Grants 760,000 Stock Options
4/18/2006Grants 1,566,000 options
9/29/2005Issues 471,000 Stock Options
2/7/2005Grants 1,485,000 stock options to directors, employees and c...
Nominations of Andina Minerals Inc.
1/8/2013Reconstitutes Board of Directors as Hochschild Achieves Mini...
Financials of Andina Minerals Inc.
5/29/2012First Quarter 2012 Update
6/21/2011Files Amended Q1 2011 Financial Statements
Project news of Andina Minerals Inc.
7/20/2011(Pampa Buenos Aires)announces progress on Pampa Buenos Aires, Vein Float Samples...
5/25/2011(Volcan)drills 266 m at 1.00 g/t Au, including 56 m at 2.6 g/t Au at...
2/15/2011(Volcan)Drills 104 m at 2.21 g/t Au, Including 30 m at 3.98 g/t Au a...
6/7/2010(Volcan)Drills 110 Metres of 1.72 g/t Gold in the Dorado West Zone
6/1/2010(Volcan)Concludes 2009 Barrick Land Acquisition and Issues 1,408,980...
9/11/2009(Volcan)Increases Measured & Indicated Resources at Volcan Gold Proj...
Corporate news of Andina Minerals Inc.
2/20/2013Hochschild Completes Compulsory Acquisition of Andina Common...
1/14/2013Announces Expiry of Successful Bid by Hochschild Mining plc
11/8/2012Agrees to Friendly Business Combination With Hochschild Mini...
9/27/2012Permit Update
4/25/2012presents at the Denver Gold Group Forum and Precious Metals ...
10/5/2011Provides Corporate Update
12/18/2009Trenching at Ojo de Agua East Encounters Widespread Minerali...
12/10/2009announces exercise of over-allotment option
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