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Acero-Martin wraps up phase 1 drilling at Pinaya

February 16, 2005
Acero-Martin Exploration Inc. has released the final results from the recently completed first phase drilling program at its Pinaya gold-copper project, located in southern Peru. The property is located approximately 110 kilometres northeast of Arequipa. Access to the property is excellent, being only seven kilometres east of BHP-Billitons's Tintaya mine road. The initial phase of drilling has demonstrated that Pinaya contains a gold-copper porphyry system. The gentle topography is favourable for mining operations.

Exploration to date covers only a small portion of an extensive hydrothermal system. The geochemical and geophysical anomalies compare favourably in size with some of the world's largest gold-copper porphyry systems. The recently completed field program delineated two distinct subparallel geophysical anomalies (induced polarization (IP)/chargeability), measuring over 2,200 and 4,000 metres in length, respectively. The two anomalies coalesce east of the open pit into an elongated IP anomaly measuring over 1,500 metres in width. Both IP anomalies coincide with strong gold-copper soil geochemical anomalies. Drilling, during 2004, was concentrated in the area of the open pit, which is located on the western flank of the recently identified geophysical anomaly. Below are the complete results from the drilling.

Hole From (meters)  To (meters)  Width (meters)  Gold (g/t)   Silver (g/t) Copper (%)
PDH-01 49.50 80.50 31.0 4.14 0.92 0.26
PDH-02 146.00 159.50 13.50 2.00 0.71 0.08
PDH-03 0.00 79.30 79.30 0.82 0.55 0.09
PDH-04 58.20 67.20 9.00 1.01 1.33 0.11
PDH-05 0.00 89.30 89.30 0.97 13.16 0.08
PDH-06 25.70 41.60 15.90 0.55 0.94 0.13
PDH-07 0 85.50 85.50 1.34 1.90 0.12
PDH-08 99.50 123.50 24.00 0.71 0.89 0.17

Favourable porphyry-style alteration and surface gold-copper mineralization are present in surface exposures and in drill core. The alteration observed in the drill core confirms that the drilling intersected the margins of a porphyry system. Drilling has yet to intersect the core of the system and, given the size and strength of the geochemical and geophysical anomalies, the company and its geological staff believe that the Pinaya property has excellent potential for the discovery of a gold-copper porphyry deposit.

Meanwhile, the company, through recent staking, purchase and option agreements, now controls mineral concessions covering more than 79 square kilometres in the immediate area of interest at Pinaya. The company also recently entered into an agreement with Minera Pinaya S.A. to acquire the Don Pedro 2000 concession for cash payments totalling $250,000 over three years. This concession is adjacent to the main Pinaya properties being approximately 2,000 metres east of the open pit. Nine samples taken from this claim returned an average of 0.9 gram per tonne Au.

The 2005 exploration program will consist of further geochemical sampling and mapping. Drilling is scheduled to begin in early March, but is dependent on local weather conditions. The planned drilling will focus on the core of the large IP anomaly, which is believed to reflect the centre of the porphyry system. Additional holes will also test the strike extension of the gold zone exposed in the open pit area. Jeff Reeder, PGeo, and James McCrea, PGeo, are the qualified persons, under National Instrument 43-101 for the Pinaya project, and are supervising the quality-control and quality-assurance program. The HQ-size core is split, and samples are transported to the SGS Labs (a laboratory certified by International Standards Organization 9002), in Lima, Peru. Gold values are determined by 30-gram fire assay fusion with an atomic absorption spectroscopy finish. All samples are also analyzed for 35 elements by ICP, total digestion and those samples anomalous in copper are reanalyzed by atomic absorption (three-acid digestion). A quality-control program of standards, blanks and duplicates is maintained.
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