IMZ Reports $12.9 Million in Pre-Tax Net Income for Third Fiscal Quarter Ending March 31, 2011 

Scottsdale, Arizona, May 16, 2011 � International Minerals Corporation (Toronto and Swiss stock exchanges: �IMZ�, the �Company�) reports excellent financial results for the third fiscal quarter ended March 31, 2011 (the �current quarter�), highlighted by $12.9 million in consolidated net and comprehensive income before the provision for future income taxes, including record net equity earnings of $16.5 million from the Company�s 40% interest in the Pallancata Mine in Peru. For the nine months ended March 31, 2011 the Company reported net and comprehensive income before the provision for future income taxes of $38.1 million and after tax income of $31.4 million ($0.27 per common share).

Subsequent to the end of the current quarter, the Company received a record quarterly dividend distribution of $26.0 million as its 40% share of the total dividend distribution of $65 million from the Pallancata Mine. This brings the cumulative dividend distributions received by IMZ to $69.6 million since the mine was first placed into production in September 2007. 

All amounts in this news release are reported in US dollars.

Highlights for the Three-Month Period Ended March 31, 2011:

During the current quarter, the Company achieved the following significant results: 

• The Company reported net and comprehensive earnings (before the provision for future income taxes) of $12.9 million compared to net earnings before tax of $3.25 million for the three months ended March 31, 2010. After the provision for future income tax of $5.0 million, the net and comprehensive income for the current quarter was $7.9 million ($0.07 million per common share). 

• The Company�s 40% share of the Pallancata mine realized record quarterly net earnings of $16.5 million after the deduction of the Company's monitoring costs and the amortization of certain non-reimbursable costs, compared to $6.4 million for the three month period ended March 31, 2010.  

• Cash and cash equivalents at March 31, 2011 increased to $64.5 million from $51.7 million at December 31, 2010 and $29.1 million at June 30, 2010. 

• Cash flow from operating activities  for the current quarter was $17.3 million compared to a use of funds of  $0.6 million for the quarter ended March 31, 2010.    

• Gross royalty revenue from Barrick�s Ruby Hill gold mine was $1.5 million for the current quarter, bringing the nine-month total to $3.5 million. This compares to gross royalty revenue of $0.4 million for the equivalent three and nine month periods ended March 31, 2010. 

• The Pallancata Mine (100% project basis) produced approximately 2.0 million ounces of silver and 7,780 ounces of gold in the current quarter, compared to 2.3 million ounces of silver and 8,219 ounces of gold in the comparable quarter which ended March 31, 2010. 

• The Company�s 40% share of production in the current quarter was approximately 810,000 ounces of silver and 3,112 ounces of gold. The decrease in gold and silver production for the current quarter compared to the prior year's comparable quarter was due to a 2.4% decrease in mill throughput coupled with a decrease in the grade of both silver and gold processed, the latter due to the fact that the higher metal prices prevailing during the current quarter allowed lower grade material to be mined profitably.                                         

• Direct site costs for the current quarter at the Pallancata Mine were approximately $2.68 per ounce silver produced (after gold by-product credits) and total cash costs (as defined by the Gold Institute) were $5.96 per ounce silver (after gold by-product credits). For the three-month period ended March 31, 2010, direct site costs and total cash costs were $3.09 and $5.83 per ounce silver, respectively.  Direct costs were lower in the current quarter compared to the equivalent quarter in 2010 due to the higher gold by-product credit and lower mining costs, while total cash costs in the current period were slightly higher due primarily to the increased government royalty due to higher silver and gold prices. 

Other Financial Information for the Three-month Period Ended March 31, 2011: 

• Other expenses totaled $2.76 million for the current quarter compared to $2.46 million for the quarter ended March 31, 2010. The increase in costs in the current quarter is mostly related to increased staffing levels related to the two corporate acquisitions (Metallic Ventures and Ventura Gold) completed in 2010. 
  
  

• In the current quarter, the Company recognized a future income tax liability of $5.0 million, representing an assumed 30% tax in Canada on the net earnings from the Pallancata Mine (see additional information below). 
   

• At March 31, 2011, the total future income tax liability was $39.7 million (including the $5.0 million discussed above).  

$26.4 million of this $39.7 million tax liability relates to the 2010 acquisitions of Ventura Gold Corp. and Metallic Ventures Gold Inc., but the tax would only become payable if the Company sells Ventura or Metallic. In addition, $17.4 million of the $26.4 million (which relates to the Ventura acquisition) will be eliminated when the Company adopts IFRS standards effective July 1, 2011. 

$13.3 million of the $39.7 million tax liability assumes that either the Company sells all or a portion of its interest in the Pallancata Mine or the earnings from the Pallancata Mine are returned to Canada as dividends and these dividends are fully subject to tax in Canada. However, if the dividends are tax sheltered in Canada or reinvested in Peru then all or a portion of this future tax liability will not be payable. 

The Company reports its interests in the Pallancata Mine and the Inmaculada property on an equity accounting basis. 

Financial Results for the Nine-Month Period Ended March 31, 2011: 

• Consolidated net and comprehensive income (before provision for possible future income taxes) for the nine-month period ended March 31, 2011 was $38.1 million and $31.4 million after the provision for taxes (or net income per common share of $0.27). This compares to net and comprehensive income after tax provisions of $9.6 million or $0.10 per share for the comparable nine-month period ended March 31, 2010. 

• The increase in income between the comparative periods resulted primarily from: a) an increase in the net equity income recognized from the Pallancata Mine of $22.7 million (or an increase of 120%): b) an increase in net royalty income of $1.7 million; and c) the recognition of a $5.6 million gain in the second fiscal quarter related to the sale of a partial interest in the Inmaculada project. Offsetting the increases was the write down of mineral property interests of $2.6 million.

• Cash flow from operating activities plus dividends received from the Pallancata Mine for the nine-month period ended March 31, 2011 was $39.3 million compared to $13.4 million for the comparable period ended March 31, 2010. 

• Net equity income from the Pallancata Mine for the current nine-month period of $41.7 million compared to $19.0 million for the comparable period ending March 31, 2010. This increase was largely a function of higher metal prices. 

• Net royalty income for the current period was $2.1 million compared to $0.4 million for the comparable period ending March 31, 2010. The Ruby Hill Mine royalty interest was not acquired by IMZ until February 2010. 

• Other expenses totaled $6.7 million for the current nine-month period compared to $6.4 million for the comparable period in 2010. The principal increases were reported in higher interest costs related to the convertible debenture (foreign exchange related) and increased staffing levels related to the two corporate acquisitions completed in 2010. 

Operating Statistics for the Pallancata Mine (100% project basis) 

The table below reports key operating and cost statistics for the Pallancata Mine for the quarters ended March 31, 2011 and 2010 and for the years ended December 31, 2010 and 2009 together with the results from the quarter ended December 31, 2010.

Notes:

1. The reported head grades for silver and gold are based on the overall metallurgical
   balance for the process plant.
2. The difference between "produced" metal ounces and 'sold" metal ounces is in-process concentrate. Sold gold and silver has been rounded.
3. Silver and gold ounces sold are now reported as gross ounces. IMZ has also restated the previously reported sales, which had been reported as net payable ounces.
4. Direct site costs per ounce silver and total cash costs per ounce silver reflect a "mined ore inventory adjustment". IMZ believes that this calculation more accurately matches costs with ounces of production (Also see notes 4 and 5 below).
5. Direct site costs per ounce silver comprise direct mining costs, mined ore inventory adjustment, toll processing costs and. mine general and administrative costs. The cost per ounce is net of by-product credit, with by-product gold revenue offsetting operating costs.
6. Total cash costs, using the Gold Institute definition, comprise: mine operating costs, mined ore inventory adjustment, toll processing costs, mine general and administrative costs, Hochschild management fee, concentrate transportation and smelting costs, local and regional taxes and government royalty (currently approximately 3% of gross revenue for Pallancata). The cost per ounce is net of by-product credit, with by-product gold revenue offsetting operating costs. 

Company Outlook 

During the 2011 calendar year, the Company's exploration and development efforts are expected to focus primarily on: 

• At the Pallancata Silver Mine in Peru:  

-       Working with Hochschild to continue production at the 3,000 tpd mining rate to produce approximately 9.3 million ounces of silver and 36,500 ounces of gold in calendar year 2011 (the Company�s estimate on a 100% project basis). 

-       Increasing mineral resources and reserves to extend the existing mine life (approximately a 4 year mine life based on current reserves). 

• At the Inmaculada gold-silver project in Peru: 

-       Working with Hochschild to continue with the aggressive exploration and development program.
 
-       Complete a feasibility study by the end of calendar year 2011.
 
-       Move the project into production by approximately December, 2013, pursuant to the agreement entered into with Hochschild during the fiscal quarter ended December 31, 2010.
 

• At the Goldfield gold project inNevada, to complete a feasibility study by the middle of calendar year 2012, with the goal of potential production in 2015.  

• At the Converse gold project in Nevada, to complete a scoping study by the end of December 2011. 

• At the Rio Blanco gold-silver project in Ecuador, to conclude discussions with the Ecuadorian government with respect to the negotiation of an exploitation contract, which will include clarification of certain tax and royalty issues related to the 2009 Mining Law. 

• Also subject to clarification of the mining law issues mentioned above, to advance the Gaby gold project with the commencement of a feasibility study. 

• Completion of the agreements with the Chinese company (China CAMC Engineering Co. Ltd.) for the financing and construction of the Rio Blanco and Gaby projects in Ecuador. 

• Enhancing cash flow by acquiring a producing asset in a low-risk political and environmental jurisdiction in the Americas. 

• Continuing to seek additional strategic joint venture alliances, such as that with Hochschild at Pallancata and Inmaculada, in order to fast-track projects to production and to reduce future cash outlays by the Company. 

Hochschild Mining plc does not accept any responsibility for the adequacy or inadequacy of the disclosure made in this news release and any such responsibility is hereby disclaimed in all respects. 

To access full copies of March 31, 2011 Financial Statements and Management Discussion and Analysis (MD&A), please click this link:  http://www.intlminerals.com/financialreports.php. 

For additional information, contact: 

In North America                                                            In Europe
Paul Durham, VP Corporate Relations                     Oliver Holzer, Marketing Consultant
Tel: +1 480 483 9932                                                    +41 44 853 00 47 

Or email us at: IR@intlminerals.com                         Internet Site: http://www.intlminerals.com    

Cautionary Statement: 

The Gold Institute calculation of Direct Site Costs and Total Cash Costs are non-Canadian GAAP financial measures, which Company management believes are useful in measuring operational performance. Some of the statements contained in this release are �forward-looking statements� within the meaning of Canadian securities law requirements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements in this release include statements regarding, production expectations, drilling and development programs on the Company�s projects, timing of commencement of construction and production and, obtaining of required environmental and production permits. Factors that could cause actual results to differ materially from anticipated results include risks and uncertainties such as:  risks relating to obtaining mining and environmental  permits; mining and development risks; financing risks; risk of commodity price fluctuations; political and regulatory risks; risks related to the new mining law in Ecuador, and other risks and uncertainties detailed in the Company�s Annual Information Form for the year ended June 30, 2010, which is available at www.sedar.com under the Company�s name. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.