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News Release

Silver Dragon Resources discovers significant Tin mineralization at Laopandao; Commissions 5,100m drill program and NI 43-101 resource/development study

BEIJING, May 4, 2010 (PRIME NEWSWIRE) – Silver Dragon Resources Inc. (OTCBB: SDRG) (“the Company”) is pleased to announce the discovery of significant tin mineralization on its Laopandao Property, Inner Mongolia, China.  This discovery is in addition to the polymetallic-silver deposit on the Property, currently at the resource development stage and being explored from surface and underground.  Six diamond drill holes totalling 3,070 metres traced 21 mineralized zone-deposits variably down dip to 400 metres.  All of the holes intersected significant tin mineralization. Highlights are as follows:

  • The 21 mineralized zones averaged from 0.240 % Tin (“Sn”) over 3.4 m to 0.506% Sn over 9.2m with minor amounts of  silver and copper, including an intersection grading 34.08% Sn over 0.4 metres;
  • Typical zones of mineralization include:
    • Zone No. III-10: 150m long, 1.8m true width, traced to a depth of 250m at an average grade of 0.394% Sn; 
    • Zone No. III-15: 50m long, 2.3m true width, traced to a depth of 120 m at an average grade of 0.204% Sn; and
    • Zone No. III-19: 100m long, 8.5 m true width, traced to a depth of 150m at an average grade of 0.506% Sn.
  • A fully funded, advanced surface and underground exploration program is planned for 2010, including up to 5,100m of drilling, 1,300m of tunnelling and 1,000m of trenching  to further define Laopandao’s resource potential;
  • A National Instrument 43-101 report has been commissioned for the summer of 2010 to generate an initial resource estimate and examine the viability of a central mill to process run-of-mine material from Laopandao and Silver Dragon’s nearby Dadi Property.


Click to englarge

Figure 1: Geological and Mineralization of Central Part of the Laopandao Property

The tin mineralization at Laopandao is associated with tabular greisen zones within the granite near the contact with volcanic rocks.  Trenching and drilling results indicate the presence of surface enrichment, characterized by high tin, silver, and copper values, which at depth grades into a zone of metal depletion followed by a zone of higher tin and typically lower silver.  From the surface elevation of 1,780 metres down to 1,600 metres, tin typically falls in the range of 0.1% to 0.6% over 3.0 metres, with associated silver variably up to 83 gpt over 1.0 metre and elevated copper ranging from 0.01% to 0.045% over 2.0 metres.  The following table of drill results illustrates this relationship and defines what Silver Dragon refers to as the No. III-10 Zone-Deposit, as being 150 metres long and 1.8 metres true width, having a 250 metre down dip extension and an average true width tin grade of 0.394%:



Click to englarge

2: Geological Map of Mineralization Zone No. III

III-10 Zone Deposit, Laopandao Project

Hole From To Core True Ag Cu Sn
Number (m) (m) Length Width (gpt) (%) (%)
ZK3001 113.30 115.23 1.93 1.70 6.08 0.05 0.31
ZK3002 102.65 105.65 3.00 2.70 1.20 0.00 0.56
ZK3003 164.90 165.80 0.90 0.70 1.20 0.01 0.29
ZK3004 9.50 14.70 5.20 3.00 10.83 0.13 0.40
ZK3011 107.60 109.60 2.00 1.00 2.20 0.06 0.14

From 1,600 metres down to 1,450 metres, the tin grade ranges from 0.10% to 0.56% over three to four metres, while silver falls in the range of 1.0 to 10.0 gpt with trace copper.  The following table of drill results illustrates this relationship and defines what Silver Dragon refers to as the No. III-15 Zone-Deposit, as being 150 meters long and 2.84 meters true width, having a 120 metre down dip extension and an average true width tin grade of 0.240%:

III-15 Zone Deposit, Laopandao Project

Hole From To Core True Ag Cu Sn
Number (m) (m) Length Width (gpt) (%) (%)
ZK3001 249.30 253.40 4.10 3.70 1.32 trace 0.18
ZK3003 329.40 333.50 4.10 2.80 22.81 0.37 0.11
ZK3004 88.30 93.50 5.20 3.00 1.71 0.01 0.44
ZK3011 192.10 193.90 1.80 1.40 1.20 0.00 0.17
ZK3041 157.60 162.80 5.20 3.30 1.20 0.00 0.27

From 1,450 metres down to 1,300 metres, tin remains dominant and the grade variably increases with depth ranging from 0.58% over 12.9 metres to a bonanza grade of 34.08% over 0.4 metres, with lesser amounts of silver in the range of 1 to 2 gpt with trace amounts of copper.  The following table of drill results illustrates this relationship and defines what Silver Dragon refers to as the No. III-19 Zone-Deposit, as being 100 meters long and 8.5 meters true width, having a 150 metre down dip extension and an average true width tin grade of 0.506%:

III-19 Zone Deposit, Laopandao Project

Hole From To Core True Ag Cu Sn
Number (m) (m) Length Width (gpt) (%) (%)
ZK3001 392.90 405.80 12.90 9.90 1.22 Trace 0.50
ZK3002 373.30 390.90 17.60 12.90 1.45 0.01 0.58
ZK3004 322.40 326.00 3.60 2.80 1.20 0.02 0.21

The following table summarizes the more significant zone-deposits. All of the zone-deposits contain minor amounts of silver averaging about 2 gpt with trace amounts of copper.

Zone Strike Length Width Down Dip Extension Average Grade
Deposit (metres) (metres) (metres) % Sn
III-1 100 1.90 50 0.489
III-2 100 1.00 100 0.900
III-3 100 4.50 50 0.372
III-9 100 7.70 100 0.235
III-10 150 2.40 250 0.394
III-14 200 4.00 100 0.332
III-15 120 3.40 100 0.240
III-19 100 9.20 140 0.506
III-21 100 2.10 150 0.736

Note: The cut-off grade of tin is 0.20% and the minimum mining width is 0.8 meters. The strike lengths of zone-deposits III-1 through III-15 were determined from the surface trenches The strike lengths of the zone-deposits  III-16 through III-21 were determined from diamond drill intersections.



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Figure 3: Profile of Exploration Line No. 300 (Looking West)

Silver Dragon and its Chinese Joint Venture partners are planning a major surface and underground exploration program at Laopandao during 2010, consisting of 5,100 metres of diamond drilling, 1,300 metres of underground exploration-development and 1,000m of trenching to define the resource potential on the property culminating in the preparation of a preliminary assessment by Q4-2010.

Marc Hazout, President and CEO of Silver Dragon,  reports that, "In light of the current tin price of around $8 per pound, the results of the 2009 exploration program - including the discovery of a possible tin deposit at Laopandao - are significant, and demonstrate that exploration potential is increasing at our Laopandao Property.  Importantly, Laopandao is fully funded to carry out the proposed 2010 surface and underground exploration-development program.”

The Company has retained Southampton Associates Inc. of Toronto, Canada, to prepare a National Instrument 43-101 report on the Laopandao Property, as well as to evaluate the viability of a central mill complex to process future production from the Dadi Polymetallic-silver Property and the Laopandao Property.

David G. Wahl, P.Eng., P.Geo., ICD,  is Silver Dragon’s independent Qualified Person under the requirements of National Instrument 43-101 and is responsible for this press release.

Analytical Procedures:
The samples were taken by qualified geologists and technicians of The North China Geological Exploration Bureau* under the direction of Dr. Liu, a Chinese National educated at the University Of Cincinnati, USA, and an independent advisor to the Joint Venture. Dr. Liu is a senior member in good standing with Geological Society of China – Mining Geology Division.

The rock and core samples collected on the Laopandao Property were delivered to the Yanjiao Central Laboratory of North China Nonferrous Geological Bureau in Sanhe for analysis. The Yanjiao Central Laboratory of North China Nonferrous Geological Bureau is not an ISO approved Laboratory; however, it has been recognized by the government of China for the high quality of its work.  Southampton Associates Inc. visited the Yanjiao Central Laboratory of North China Nonferrous Geological Bureau and held discussions with the management and staff and reviewed the sample QA/ QC flow sheet from sample arrival to sample archive.  The Yanjiao Central Laboratory of North China Nonferrous Geological Bureau is equipped with modern analytical instrumentation similar to what would be operating in a modern North American Laboratory.

The ground material, from the crushing and grinding section, is delivered to the analysis section of the laboratory for further processing.  The assay procedure for lead, zinc and silver is as follows:

  • From the 400 gram sample generated from the crushing and grinding circuit, a 0.2 gram sample is taken for analysis.  The sample is digested in Aqua Regia (3HCl + HNO3).  Following complete digestion, 50 millilitres of water is added to the sample.  The sample is then analyzed using Atomic Absorption Spectroscopy (“AAS”).  The grades for contained lead, zinc and silver are calculated and reports the following elemental accuracy; silver (Ag) reported in parts per million (ppm) with an accuracy of 1 part per million, and for lead (Pb) and zinc (Zn) both are reported in percent (%) with an accuracy of 0.01 %.
  • The Yanjiao Central Laboratory of North China Nonferrous Geological Bureau is an independent government run laboratory and is not related either to Silver Dragon, Sino-Top or the Joint Venture.  No aspect of the sample preparation or the analytical procedure was carried out by an employee, officer, director or associate of Silver Dragon, Sino-Top or the Joint Venture.

About Laopandao
Laopandao is one of the six exploration properties of Sanhe Sino-Top Resources and Technologies Ltd. ("Sino-Top"), a Chinese company that holds exclusive exploration rights to these properties, located in the prolific Erbahuo Silver District in Inner Mongolia, China.  Silver Dragon Resources Inc. has a 40% ownership interest in Sino-Top.  The Laopandao exploration area covers 44.79 square kilometres and is located approximately 650 kilometres north by northeast of Beijing in Chifeng, Inner Mongolia (see Project location Map at http://www.silverdragonresources.com/_gui/China_Project_Location_Map.jpg). Mineralization zones have been identified in the northern, central, and southern portions of the exploration area.  The most significant recent discovery was the existence of Ag-Sn-Cu-Pb mineralization on the peripheries of a previously identified tin mineralized zone.  The mineralization is mainly a continental volcanic-sedimentary rock altered strata-bound mineral type.

About Sino-Top – China Mining 2009 Award Winner*
Sanhe Sino-Top Resources & Technologies, Ltd. ("Sino-Top") was originally incorporated in 2003 as a Chinese company wholly-owned by Huaguan Industrial Corp. ("HIC"), a subsidiary of the state-owned North China Geological Exploration Bureau.  Sino-Top became an American-Chinese joint venture in 2005.  Silver Dragon Resources Inc. acquired Sino-Top in 2006, and currently owns 40% of Sino-Top after having sold 50% of its ownership interest to its Chinese partners.  The Chinese side, led by Gansu Shengda Group Ltd. (“Shengda”), at 52%, and HIC, at 8%, collectively own 60% of Sino-Top.  Sino-Top holds exclusive exploration and development rights to six properties in northern China (Inner Mongolia), covering a total area of 139 km2.  Sino-Top won the prestigious Prospector/Explorer of the Year Award for its Dadi Silver Polymetallic Project at the China Mining Congress & Expo 2009 held in Tianjin, China, during October 20-22, 2009.

About Silver Dragon Resources Inc.:
Silver Dragon Resources Inc. is a mining and metals company focused on the exploration, acquisition, development and operation of silver mines in proven silver districts globally. Silver Dragon's objective is to acquire silver mining assets that contain promising exploration targets, have highly leveraged, out-of-the-money silver deposits, and/or are producing properties with significant untapped exploration potential. It is management's objective to grow Silver Dragon into a significant silver producer by developing the Cerros las Minitas project in Mexico, its six Sino-Top properties in China ( particularly Dadi and Laopandao), and its Erbahuo Silver mine (via its Chifeng Silver Dragon subsidiary), also in China. For more information, please visit the Company's website at: www.silverdragonresources.com (now available in Chinese).

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained herein which are not historical, such as statements regarding the exploration and development of the Dadi Silver Project, outcome and timing for the completion of further assays and metal amounts in partial assay results, are forward-looking statements.  Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects,” “plans,” “anticipates,” “believes,” “intends,” “estimates,” “projects,” “aims,” “potential,” “goal,” “objective,” “prospective,” and similar expressions, or that events or conditions “will,” “would,” “may,” “can,” “could” or “should” occur. Information inferred from the interpretation of assay results and information concerning mineralization zones may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed.  Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, certain delays beyond the company's control with respect to future assay results, delays in testing and evaluation of assays, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.  

Contact Silver Dragon Resources Inc.

Marc Hazout
President
(416) 223-8500 or Toll Free: 1-866-512- SDRG (7374)
Email: info@silverdragonresources.com

Alessandro Motta
Investor Relations
(416) 223-8500 or Toll Free: 1-866-512- SDRG (7374)
Email: info@silverdragonresources.com

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The United States Securities and Exchange Commission (SEC) limits disclosure for U.S. reporting purposes to mineral deposits that a company can economically or legally extract or produce. We may use certain terms on this website such as "reserves," "resources," "geologic resources," "proven," "probable," "measured," "indicated" or "inferred," which may not be consistent with the reserve definitions established by the SEC. U.S. investors are urged to consider closely the disclosure in our Form 10-K. You can review and obtain copies of the latest Form 10-K filing from the SEC's website at http://www.sec.gov/edgar.shtml.