Minera Andes reports net income for second quarter of $0.05 per share

    TSX: MAI
    NASD-OTCBB: MNEAF

SPOKANE, WA, Aug. 15 /PRNewswire-FirstCall/ - Minera Andes Inc. (TSX-MAI and US OTC: MNEAF) is pleased to report net income of $8.9 million or $0.05 cents per share in its second quarter of 2008 financial statements. For the six months ended June 30, 2008, Minera Andes recorded net income of $7.2 million or $0.4 cents per share. Our financial statements are available at www.sedar.com.

Minera Andes' net income is derived from Minera Santa Cruz S.A.("MSC"), which is owned 49% by Minera Andes and 51% by Hochschild Mining plc. ("Hochschild") (HOCM.L: Reuters and HOC LN: Bloomberg - London Stock Exchange). MSC operates the San Jose silver/gold mine in southern Argentina, which had its first quarter of positive earning from silver and gold sales following the commencement of production at San Jose last year. Hochschild is the operator of the San Jose mine.

Allen Ambrose, President of Minera Andes said, "This is a milestone event for Minera Andes, to report a significant net income in its financial statements. Showing net income is the next step as we transition to a producing company with a growing silver and gold asset. With expansion underway to double its current rate of production by year-end, it is estimated that the San Jose mine will join the ranks of the top ten primary silver producing mines in the world."

Commissioned in June of 2007, the San Jose mine is operating in 2008 at full production or approximately 750 tonnes per day.

As previously reported, silver and gold sales in the second quarter, totaled $63.2 million. Over the past year, San Jose's total sales have been $74.4 million. The averaged weighted sales prices were $901/ounce of gold and $16.47/ounce of silver. San Jose's silver and gold sales are unhedged. Second quarter 2008 sales of silver and gold are higher than normal because some of the metals produced in the first quarter of 2008 were sold in the following quarter and we are presently mining ore that has a higher silver content.

Production

San Jose's silver production rose in the second quarter compared to the first quarter. Silver production was 1,093,000 ounces, compared to 968,000 ounces in the first quarter. Annualized, second quarter silver production is running at approximately 33% above the average grade of the reserves in the original mine plan. During the life of the mine it is anticipated the gold and silver production will be in line with the mine plan. Gold production in the second quarter was 12,410 ounces, compared to 12,140 ounces in the first quarter.

Mine Expansion Underway

Work continues at San Jose to double production rate to 1,500 tonnes of ore per day by the end of 2008. At this rate, the mine is estimated to have annualized metal production of approximately 120,000 ounces of gold and approximately 6 million ounces of silver. Underground infrastructure continues to be expanded, and construction is underway to increase capacity at the processing plant.

Allen V. Ambrose, Minera Andes' President, who is a "qualified person" as defined by National Instrument 43-101, is responsible the information used in this news release and has supervised the preparation of the information and reviewed all information used in this news release.

Minera Andes is a gold, silver and copper exploration company working in Argentina. The Company holds about 304,000 acres of mineral exploration land in Argentina including the 49% owned San Jose silver/gold mine. Minera Andes is also exploring the Los Azules copper project in San Juan province, where an exploration program is underway to define a resource and to prepare a scoping study. Other exploration properties, primarily silver and gold, are being evaluated in southern Argentina. The Corporation presently has 189,456,935 shares issued and outstanding.

This news is submitted by Allen V. Ambrose, President and Director of Minera Andes Inc.

Caution Concerning Forward-Looking Statements:

This press release contains certain "forward-looking statements", including, but not limited to, the statements regarding the Company's strategic plans, evolution of mineral resources and reserves, work programs, development plans and exploration budgets at the Company's San Jose Project. The forward-looking statements express, as at the date of this press release, the Company's plans, estimates, forecasts, projections, expectations or beliefs as to future events and results. Forward-looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements. In particular, there can be no assurance that production capacity at the San Jose mine will be successfully increased, that resources and reserves at the San Jose mine will be increased. Risks and uncertainties that could cause results or future events to differ materially from current expectations expressed or implied by the forward-looking statements include, but are not limited to, factors associated with fluctuations in the market price of precious metals, mining industry risks, risks associated with foreign operations, the state of the capital markets, environmental risks and hazards, uncertainty as to calculation of mineral reserves and other risks. We refer readers to the risk factors and uncertainties described in the Company's continuous disclosure record, a copy of which is available under the Company's profile at www.sedar.com. Minera Andes' joint venture partner, a subsidiary of Hochschild Mining plc, and its affiliates do not accept responsibility for the use of project data or the adequacy or accuracy of this release.

Cautionary Note to U.S. Investors:

The United States Securities and Exchange Commission (the "SEC") permits mining companies, in their filings with the SEC, to disclose only those mineral deposits with "mineral reserves" that a company can economically and legally extract or produce. We use certain terms in this press release, such as "mineral resources", that the SEC guidelines strictly prohibit us from including in our filings with the SEC, because these terms are common usage in Canada and form part of our Canadian filing requirements.

SOURCE Minera Andes Inc.