Agnico-Eagle to present today at the Denver Gold Forum; Provides updates on operations and projects

Stock Symbols: AEM (NYSE) AGE (TSX) 


TORONTO, Sept. 27  /PRNewswire-FirstCall/ -- Agnico-Eagle Mines Limited will be presenting today to analysts and investors at the Denver Gold Forum. The presentation is scheduled to begin at 11:15 am (EDT) and a copy of the presentation is available on the Company's website, http://www.agnico-eagle.com/. A simultaneous webcast will be available, which can also be accessed on the Company's website.

Sean Boyd, President and CEO, will discuss the Company's growth opportunities including Goldex, Lapa, and LaRonde II in Quebec. Also discussed will be the international growth opportunities at Pinos Altos in Mexico, and Suurikuusikko in Finland. In addition, Mr. Boyd will provide an update on operations at LaRonde, Agnico-Eagle's mine in Quebec.

Update On The LaRonde Mine

The LaRonde mine has operated at an average rate of over 8,000 tons per day in 2005, with operating costs on target at approximately C$50 per ton. Production and cost guidance for the full year 2005 is on track and remains at approximately 250,000 ounces of gold at a total cash cost below $100 per ounce.

LaRonde continues to have production flexibility due to the advanced stage of development of the lower mine. Last week, two secondary mining blocks near the 194 Level sill pillar fell into an empty open stope. Due to the mine's ability to adapt to changing ground conditions, this resulted in only minor adjustments to the 2005 mine plan, and production continued without interruption. This type of event is consistent with the normal challenges associated with mining near sill pillars. The ore in the secondary mining blocks is expected to be recovered in the fourth quarter of this year.

LaRonde II Project Update

Drilling and mine planning work continues on the LaRonde II project. Drilling is focused on transferring deeper resources to reserves, and on exploring the limits of the deeper mineralization at LaRonde, and along the main mineralized trend. To date, higher grade gold and base metal values continue to be encountered. It is anticipated that the LaRonde resource will continue to be converted to reserves, with an update on the results expected by February, 2006.

Mine planning work has concluded that the best approach to developing the LaRonde II reserves is via an internal mine shaft, or "winze". This approach is superior to other options due to its shorter lead time, lower capital cost, and higher rate of return. The winze approach also benefits from the use of proven, existing infrastructure, such as the ventilation and cooling systems, ramp system, and processing facilities. The mine plan currently being studied contemplates a production rate of 5,000 tons to 6,000 tons per day at an average gold grade of approximately 0.17 ounces per ton, resulting in annual production of approximately 300,000 ounces. It is expected that this production would extend the mine life of LaRonde through 2020. The entire LaRonde II study and mine plan are expected to be completed by the end of 2005.

Goldex Is Under Construction

Following the July, 2005 decision to put the Goldex mine into production, work has begun on the shaft collar. The shaft is scheduled for a final depth of 3,000 feet, with sinking beginning in third quarter of 2006. Underground development and construction has begun, with access provided by existing underground workings. Plant construction is expected to commence in the second quarter of 2006. Gold production at Goldex is anticipated to begin in the second half of 2008, averaging 170,000 ounces per year, over a ten year mine life, with total cash costs averaging less than $200 per ounce. Goldex capital costs are estimated at $135 million. The Goldex deposit remains open at depth and to the east, with the ultimate size of the orebody to be determined.

Due to its proximity to LaRonde (35 miles east), the Goldex mine will benefit from operating synergies as well as the technical expertise of the LaRonde personnel.

Shaft Sinking Is Well Advanced At The Lapa Project

Located seven miles east of LaRonde, the Lapa project is also expected to benefit from significant operating synergies and Agnico-Eagle's technical expertise. The Phase One project includes the sinking of a new mine shaft, which is currently at more than 1,400 feet deep, or 50% of its ultimate depth of 2,850 feet. The shaft is expected to be completed by the second quarter of 2006. Phase One also includes an underground drilling program to validate the continuity and grade of the present reserve estimate. This program is scheduled to begin this December. A bulk sample and metallurgical test are scheduled to begin in the third quarter of 2006, and be incorporated into the feasibility study, to be completed by the end of that year. Positive results from the Phase One project would result in a production decision which would bring the Lapa Project into production in the second half of 2008 at a capital cost of $80 million. Gold production of approximately 125,000 ounces per year, at a total cash cost of approximately $200 per ounce, has been projected over a 10 year mine life.

Drilling Continues At Pinos Altos

Agnico-Eagle continues to drill at Pinos Altos under its option agreement with Industrias Penoles S.A de C.V. Agnico Eagle's program had three objectives, firstly to validate the present resource estimate, secondly to test for near surface projections and open pit potential and thirdly, to test the deposit at depth for extensions. The most recent drill results, as presented with the second quarter financial results on July 27, 2005, were very encouraging with several high grade intersections over significant widths. The present program has confirmed open pit potential and the previous resource estimate. Exploration is currently focused at depth and on adjacent structures along strike to the east and west of the Santo Nino structure.

Currently, a scoping study is underway to evaluate the potential of an open pit and underground operation.

Agnico-Eagle expects to make its decision on whether to acquire the project by late 2005, or early 2006.

Corporate Development

In addition to its outstanding bid for the shares of Riddarhyttan Resources AB (see press release dated May 12, 2005), Agnico-Eagle continues to actively review corporate development opportunities. The medium term goal of the Company continues to be to operate gold mines in several long-term mining camps, located in areas of low political risk. In this regard, Agnico-Eagle actively invests in smaller, emerging, companies with the current approximate value of its marketable securities being $18 million.

Credit Facility To Be Expanded And Extended

The Company is in advanced stage negotiations with its bank syndicate to increase the size of its $100 million credit facility to $150 million and extend the term by two years to December, 2009. Definitive documentation is expected to be completed in the fourth quarter. The current facility is substantially undrawn.

Forward-Looking Statements

The information in this press release has been prepared as at September 27, 2005. Certain statements contained in this press release constitute "forward- looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. When used in this document, the words "anticipate", "expect", "estimate", "forecast", "planned" and similar expressions are intended to identify forward-looking statements.

Such statements include, without limitation: estimates of future mineral production and sales; estimates of future production costs and other expenses; estimates of future capital expenditures and other cash needs; statements as to the projected development of certain ore deposits, including estimates of exploration, development and other capital costs, and estimates of the timing of such development or decisions with respect to such development; estimates of reserves and resources, and statements regarding future exploration results; the anticipated timing of events with respect to the Company's mine sites, including Goldex and Lapa; the anticipated timing of events with respect to the Company's exploration and decision in connection with its Pinos Altos option; the Company's bid for Riddarhyttan; the ability of the Company to achieve its objective of building a multi-mine production base; and other statements regarding anticipated trends with respect to the Company's capital resources and results of operations. Such statements reflect the Company's views at the time with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors, known and unknown, could cause the actual results to be materially different from those expressed or implied by such forward-looking statements. Such risks include, but are not limited to: the Company's dependence upon its LaRonde mine for all of its current gold production; uncertainty of mineral reserve, mineral resource, mineral grade and mineral recovery estimates; uncertainty of future production, capital expenditures, and other costs; gold and other metals price volatility; currency fluctuations; mining risks; and governmental and environmental regulation. For a more detailed discussion of such risks and other factors, see Company's Annual Information Form and Annual Report on Form 20-F for the year ended December 31, 2004, as well as the Company's other filings with the Ontario Securities Commission and the U.S. Securities and Exchange Commission. The Company does not intend, and does not assume any obligation, to update these forward-looking statements.

About Agnico-Eagle

Agnico-Eagle is a long-established Canadian gold producer with operations located in northwestern Quebec and exploration and development activities in Canada, the United States and Mexico. Agnico-Eagle's LaRonde Mine in Quebec is Canada's largest gold deposit. The Company has full exposure to higher gold prices consistent with its policy of no forward gold sales. It has paid a cash dividend for 25 consecutive years. 

DATASOURCE: Agnico-Eagle Mines Limited



CONTACT: David Smith, Director, Investor Relations, [phone]

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