Lagartos

LAGARTOS PROPERTY
MUNICIPIO FRESNILLO ZACATECAS, MEXICO

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September 2008

With extensive Lagartos property holdings, MAG is a dominant landholder in the Fresnillo Silver Trend, the world's premier silver producing district; looking to repeat success of Juanicipio in 'unearthing' mineral wealth beneath alluvial cover

Central to the MAG Silver story is the success in 2005 in discovering the Valdecañas Vein, on our Juanicipio Property, in the Fresnillo Silver Trend.

This vein was encountered just 5 kilometres from the main headframe of our partner's (Industrias Peñoles) Fresnillo Mine, the world's largest primary silver producer. Key to the discovery was MAG's belief that hidden underneath the alluvium that covers virtually all of the Juancipio property, lay significant vein systems at depth. That proved correct, and the Valdecañas Vein today represents a substantial new mineral resource - still open and growing - and is considered within the industry one of the most important silver discoveries in recent memory.

Following this success MAG moved quickly to secure, through acquisition and staking, two very large claim groups lying northwest and southeast of the Juanicipio Joint Venture. Both properties lay along the Fresnillo Silver Trend, a large regional structural zone hosting the Guanajuato, Zacatecas and Fresnillo epithermal silver-gold vein districts.

All of the known deposits were found in outcrop between 350 and 500 years ago, but since over 60% of the trend is masked by alluvial soils, as was the Valdecañas Vein, MAG hopes it can repeat its Juanicipio success with discoveries at Lagartos.


Program results: 2006

Work in 2006 focused on the Lagartos Northwest area on a zoned alteration centre, very similar to that seen at Juanicipio, surrounded by alluvial cover. Biogeochemical and ground magnetic surveys of the flanking cover areas revealed linear magnetic anomalies parallel to the Fresnillo Silver Trend with overlapping and concentric biogeochemical silver, lead, zinc and copper anomalies. These structures and their associated metal anomalies can be traced for distances approaching eight kilometres. The drill program was designed to test structural intersections and geochemical anomalies in settings similar to those found at Juanicipio and Fresnillo.

A 13-hole, 7,364-metre drill program was carried out on these anomalies in 2006. All of the holes encountered strongly altered volcanic rocks under shallow alluvial cover, and three intersected the "Guerrero Terrane" rocks that host the veins at Fresnillo and Juanicipio. One hole, drilled through alluvial cover four kilometres from the nearest outcrop, cut 3.5 metres grading 14 to 49 g/t (0.5 to 1.5 opt) silver. The results indicate that silver mineralization is associated with this alteration centre and that our exploration methods are helping to "see through" alluvial cover.

The Lagartos Southeast block covers the broad plain lying between Fresnillo and the historic Zacatecas mining district. In 2006 MAG staked all of the open ground surrounding Zacatecas and purchased numerous claims over past producing veins within the district. This gives MAG the potential projections of the E-W trending district veins as well as the San Gabriel vein field in the northernmost part of the district.


Program results: 2007

Initial drilling of Lagartos SE in 2006 totalled 7,066 metres in 20 holes. The objective was to test at shallow depth a number of vein and structural targets traceable for strike lengths of 600 to 1,000 metres to determine which targets offer the best opportunity to host significant mineralization at depth.

Results point to a very high level silver-gold epithermal vein environment in two of the structures. The best hole intercepted 6.0 metres of 42.5 g/t silver and 0.34 g/t gold with strongly anomalous arsenic and antimony values. Six other holes also reported anomalous silver values with highly anomalous arsenic. This silver-gold-arsenic combination is comparable to what is seen in the highest portions of epithermal veins found in the Zacatecas district and Juanicipio area of the Fresnillo district. This vein set was also intersected in Hole LP-7 located almost 500 metres further to the northwest, indicating that this vein structure could be at least 1,100 metres in length.

One of the dominant landholders in Fresnillo Silver Trend, MAG enhanced its position in 2007. Almost 770 hectares of concessions covering some of the major historical producing vein sets in the Zacatecas district were acquired through cash option and purchase agreements. We also staked an additional 13,628 hectares in the district.


Lagartos Properties: Outlook

With the benefit of regional geological data, and air photo and satellite image analysis and interpretation, MAG has identified and secured vast claims (now entailing over 135,000 hectares) that lay along trend to the Fresnillo and Zacatecas mining districts, and show similarly strong geological characteristics.

All the work leading to the success of the Valdecañas Vein discovery has informed our exploration plans for this highly productive but underexplored region - lessons we hope will lead to further discoveries.

Related News Releases:

January 23, 2008	MAG Silver Updates Initial Exploration Program at Lagartos SE in Zacatecas District
April 18, 2007	MAG Silver Begins Drill Program at Lagartos SE