TVI Pacific"s Canatuan Mine on the Zamboanga Peninsula in Mindando , Philippines has exceeded interim targeted throughput of 1200 dry metric tonnes of milled gossan ore per day.

The plant has operated at a steady state of approximately 1300 dry metric tonnes per day and has been successfully tested beyond 1500 dry metric tonnes per day on a sustained basis. The expanded grinding circuit has proven capable of handling the increased throughput.

Further improvements to the primary crusher and feed system at the front end of the plant were implemented to increase the steady state operational throughput to approximately 1500 to 1600 dry metric tonnes per day in the last quarter.

TVI president and CEO Cliff James says, "Our operations team continues to successfully test the throttle in terms of throughput and metal production

"Overall cost reduction is also now a major priority. The Canatuan Mine and team continue to exceed our expectations in an improving operating environment."

Gold and silver production has been steadily increasing in recent months and the mine is currently producing approximately 130 gold equivalent ounces per day. This is expected to increase as throughput increases and additional plant components are brought on stream in an effort to increase metal recoveries.

These include the previously reported upgrading and expanding of the CIL/CIP tank farm, additional thickening capacity and expansion of the Merrill-Crowe process. These systems came into full operation in March.

TVI has initiated a review of the reported Gossan Resource at Canatuan with a view to determining an appropriate cut-off grade to be used for an updated gossan reserve study. Given the significant rise in prices of both gold (from US$375 to a current price greater than US$500 per ounce) and silver (from US$5.50 to a current price greater than US $9 per ounce) since the November 2004 Gossan Feasibility Study, substantially lower than expected capital expenditures to complete mine development to date, anticipated lower operating costs and much better economies of scale anticipated from an increase in plant throughput (from 800 dry metric tonnes per day to 1500-1600 dry metric tonnes per day, management expects that a decrease in cut-off grade can be achieved for the ore that can be processed at Canatuan. A lower cut-off grade will increase mineable ore reserves, mine life of the gossan phase and total ounces of gold and silver that may ultimately be produced. In addition, the November 2004 resource study did not include a volume of "rubbly gossan" (boulders and fragments of gossan which has been eroded off the main body, in a laterite matrix), and is located peripheral to the in-situ gossan deposit. This is expected to become part of the resource.

TVI plans to start copper and zinc concentrate production before end of this year.

TVI consultants and accredited laboratories have completed metallurgical test work and developed the flow sheet for treating the sulphide ore at Canatuan.

TVI has negotiated a right of first refusal on two 9' x 15' ball mills, which are expected to be installed at Canatuan to support the planned 1000 dry metric tonne per day sulphide plant. TVI continues to actively look for other key pieces of equipment.

The second phase of the Gossan Tailings Dam was completed earlier this year. The additional capacity was added to allow for expanded throughput and provide tailings storage through mid next year.

TVI Pacific Inc is a publicly-listed mining company focused on exploring for and producing precious and base metals within district scale systems in Asia .

In addition to the Canatuan project, TVI holds a 2.5% net smelter return (NSR) royalty on the Philippine-based Rapu Rapu project (the second foreign-invested, new, mining project in the Philippines), which started operations in July last year, with royalty cash flow to TVI beginning in the fourth quarter last year. Exploration in the Philippines is being conducted at Canatuan (both to expand TVI's resource base and to find new deposits), and at Balabag, which management of TVI views as a compelling exploration property. Extensive applications, which cover an area of 1,257.12sqkm, have also been filed on a new copper-gold mineral district, near Canatuan, on which exploration is planned in the near future.

In China , TVI's wholly-owned Chinese subsidiary, Hunan Pacific Geological Exploration Inc. (HPGEI) is the first foreign mining company to be granted both WOFE status and a Qualified Explorer Licence. HPGEI has three main areas of interest in China - gold exploration in the Golden Triangle region of Guizhou/Yunnan/Guangxi Provinces, copper/gold exploration in Yunnan Province and copper/gold exploration in the Tibet Autonomous Region. HPGEI has 168,200 hectares of land under application in China in the Golden Triangle and in the Tibet autonomous region.

TVI also has a Drilling Division, based in both the Philippines (EDCO) and China (HPD), which generates revenue from contract drilling.