Growth

Based on positive results from an independently prepared pre-feasibility study as reported by news release on April 8, 2010, Minefinders is progressing to a detailed feasibility study on the construction of a mill at the Dolores Mine. The mill would treat high-grade ore from the open pit, process additional underground ore and increase production capacity. In advancing the feasibility study, additional mill options will be reviewed and evaluated in the context of the economic considerations pertinent to the Company prior to a construction decision. These include scenarios with lower initial capital costs that both capture the high grade ore in the open pit and provide the infrastructure necessary to develop a new underground mine at Dolores in the future.

In addition to the mill, the Company is currently working on completion of scoping level study with respect to underground development work at Dolores. First, an updated resource model is being constructed based on 3D solids derived from our current underground drill database and 3D sectional model, which we've already completed. This study should be completed at the end of September 2011, followed by the completion of a life of mine development layout to assess potential underground stopes, schedule production, and run cash flows.  Minefinders’ goal is to make a decision to commence underground operations this year and go underground as soon as it is practical to do so.

Dolores Project Plan Map

Exploration

The Company continues to conduct additional drilling beyond the pit boundaries. Drilling has uncovered extensive high-grade mineralization below the proposed pit as well as surface mineralization extending up to 1km from the pit. A new area, the North Dome has also been identified. This new mineralization has potential to be incorporated into the current mine plan or mined through possible underground operations.

In 2011, drilling activities at Dolores have continued with a year-to-date total of 11,355 meters. The results from the 2011 drill program are being incorporated into our annual reserve and resource update, which we expect to update in the first quarter of 2012.

‘North Dome’ Long Section