2009-07-16 14:45 ET - News Release

Mr. Art Johnson reports

MINERA ANDES ANNOUNCES SECOND QUARTER 2009 SAN JOSE MINE PRODUCTION

Minera Andes Inc. has released San Jose mine production results for the second quarter of 2009. During the second quarter, the San Jose mine produced 1,265,000 ounces of silver and 18,080 ounces of gold, of which 49 per cent is attributable to Minera Andes.

Compared to the first quarter of 2009, the 2009 second quarter silver production was 3% lower and gold production was 9% higher. The decrease in silver production was due to a lower head grade for silver, which was partially offset by higher processing recovery rates. The increase in gold production was the result of a higher mill feed head grade for gold and higher processing recovery rates. Mill throughput in the second quarter of 2009 was similar to the level of the previous quarter. Compared to the second quarter of 2008, the second quarter 2009 silver production increased 16% and gold increased 46% due to the increased production rate associated with the expansion program completed in the fourth quarter of 2008.

             SAN JOSE MINE PRODUCTION COMPARISON (100% BASIS)(*)
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                                             Q2          Q1          Q2
    Production                              2009        2009        2008
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    Ore production (tonnes)              119,184     118,986      60,603
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    Average head grade silver (g/t)          400         427         681
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    Average head grade gold (g/t)           5.65        5.29        7.56
    ---------------------------------------------------------------------
    Silver produced (ounces)           1,265,000   1,299,000   1,093,000
    ---------------------------------------------------------------------
    Gold produced (ounces)                18,080      16,560      12,410
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    Net silver sold (ounces)           1,709,000     838,000   2,284,400
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    Net gold sold (ounces)                21,930      11,380      28,980
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    (*) 49% of the San Jose mine production is attributable to Minera Andes
        Inc.

Second quarter production cost information will be provided when available in a subsequent press release.

Sales of precious metal were significantly higher in second quarter of 2009 compared to the first quarter because a large part of the first quarter 2009 production was not sold because new contracts with improved commercial conditions for the sale of dore and concentrates were being negotiated. As a result, a larger than normal final product inventory of silver and gold had been accumulated at the end of the first quarter that was sold in the second quarter. In comparison to the same quarter of last year, sales in second quarter of 2009 were lower because gold and silver produced in the fourth quarter of 2007 and first and second quarter of 2008 were sold during the second quarter of 2008.

Product inventories were reduced substantially by the end of the second quarter compared to the end of the first quarter of 2009, as shown on the table below.

        SAN JOSE MINE PRODUCT INVENTORY COMPARISON (100% BASIS)
    ------------------------------------------------------------
                                                Q2          Q1
                                               2009        2009
    ------------------------------------------------------------
    Concentrate (tonnes)                        992       1,449
    ------------------------------------------------------------
    Dore (kg)                                 2,885      12,110
    ------------------------------------------------------------
    Precipitate (kg)                          3,994       7,437
    ------------------------------------------------------------
    Total contained Ag in all products (oz) 391,000     898,000
    ------------------------------------------------------------
    Total contained Au in all products (oz)   6,610      11,290
    ------------------------------------------------------------
    (*) 49% of the San Jose mine production is attributable to Minera Andes
        Inc.

In addition to the plant capacity expansion, construction of a new power line was completed at the end of the first quarter of 2009, linking the San Jose mine to the national grid and ensuring that it has a reliable, low-cost supply of energy. The benefit of lower energy costs started to impact mine production costs in the second quarter.

Mine production from the Kospi vein commenced at the end of the second quarter after several months of delays. During the first half of 2009, mill feed was derived from the Huevos Verdes and Frea veins and from a surface stockpile of low-grade ore. Going forward, the plan is to generate mill feed entirely from underground ore and defer processing of the stockpile ore until the end of the mine life.

In April 2009 a new mineralized structure was discovered at San Jose that is located approximately 845 meters southwest from the Huevos Verdes vein. The blind structure, which does not outcrop on the surface, was discovered in the first drill hole of a program of five 1,000 meter long diamond drill holes to be drilled horizontally from existing underground workings. The vein intercept from the discovery core hole (SMJ-105) ran 8.9 g/t gold and 517 g/t silver over 1.00 meters, as previously reported by the Corporation on April 23, 2009.

Brian Gavin, Minera Andes' Vice President of Exploration, who is a "qualified person" as defined by National Instrument 43-101, is responsible for technical information used in this news release and has supervised the preparation of such information and reviewed all such information used in this news release.