Metallica's Conceptual Study for Run of MineLeaching At Cerro San Pedro, Mexico, Indicates...

Business Editors

DENVER--(BUSINESS WIRE)--June 7, 2000

Metallica Resources Inc. (TSE:MR)(OTCBB:METLF) is pleased to announce the encouraging results from a conceptual study using run-of-mine (ROM) leaching for initiating operations at the Cerro San Pedro project located in central

The independent mining and processing consulting organizations of Mine Reserve Associates (MRA) and McClelland Laboratories assisted Mr. Fred Lightner, P.E. of Metallica, in developing the study.

At a gold price of $275 per ounce and a silver price of $5.25 per ounce, the study yielded a total of 45 million tonnes of material grading 0.56 grams per tonne gold and 23.24 grams per tonne silver containing 815,000 ounces of gold and 33.6 million ounces of silver at an overall waste to ore ratio of 1.4 to 1. With estimated recoveries of 73 percent of the gold and 38 percent of the silver, total production of 597,000 ounces of gold and 12.9 million ounces of silver would be realized. At an 8 million tonne annual ore processing rate, average production would be approximately 100,000 ounces of gold and 2.1 million ounces of silver per year or 140,000 ounces of gold equivalent per year. The total capital cost to achieve production was estimated at $41.9 million. Cash operating costs were estimated at $3.09 per tonne of ore or $135 per ounce of gold using the Gold Institute method for determining operating costs.

The Metallica ROM study was undertaken after Cambior completed a Feasibility Study in late 1999 which incorporated a three-stage crushing plant in the process flowsheet. Cambior's Feasibility Study reported proven and probable reserves of 64 million tonnes grading 0.62 grams of gold and 24.5 grams of silver per tonne respectively with a waste to ore ratio of 1.5 to 1. Cambior used a $300 gold price and a $5.50 silver price for calculating the reserve. The construction of the crushing plant, expansion of the ore reserves and extension of the mine life will be dependent upon future metal prices.

On a 100% equity basis, the following economic results illustrate the comparison of Cambior's Feasibility Study to Metallica's ROM study:

                                    Cambior
                                Feasibility       Metallica ROM

                     Gold Price        $275       $275         $300
                   Silver Price       $5.25      $5.25        $5.50

After Tax - IRR              (%)        8.9 %     19.5 %       25.9 %
NPV @ 0 %                 ($000)    $36,606    $42,146      $55,626
NPV @ 8 %                 ($000)     $2,621    $16,999      $26,424
Capital Cost              ($000)    $67,800    $41,900      $41,900
Operating Cost     ($/tonne ore)      $3.73      $3.09        $3.09
Total Cash Cost /a  ($/oz. gold)       $140       $135         $130

    /a Calculated by the Gold Institute Method Including Royalties

MRA, under the supervision of Mr. Larry Allen, Principal Mining Engineer, and Mr. William Rose, P.E. and Principal Mining Engineer, developed the mine production plan with capital and operating costs that was used in the Metallica study. The mine production plan was based on the geological block model developed by Cambior Inc. for its December 1999 Feasibility Study. A computerized mine program, a floating cone technique, was used to determine the ultimate open pit mine configuration. A 12% increase in waste tonnage was added to this open pit mine to account for roads and ramps of an actual mine design.

Mr. Gene McClelland, Metallurgist and President of McClelland Laboratories, reviewed Metallica's precious metal recoveries, production projections, and process capital and operating costs. McClelland Laboratories has conducted the majority of the metallurgical studies for Cerro San Pedro and has been associated with the project for over four years.

MRA and Mr. McClelland have stated that the assumptions and projections are reasonable and appropriate for a study of this nature.

Mr. Richard Hall, President and CEO of Metallica, stated: "We are excited that, at current precious metal prices, the run of mine study shows such promising economic results and an alternative to the Cambior Feasibility Study for initiating operations at Cerro San Pedro. Our study commenced prior to Glamis Gold's purchase of Cambior de Mexico, which resulted in Glamis owning 50 percent of the Cerro San Pedro project. As operator, Glamis will determine the best development plan consistent with the project's existing operating permits. We look forward to Glamis' experience and expertise in bringing the Cerro San Perdo project into production."

Metallica is a Canadian precious metals exploration and development company focused on the Americas. Metallica is well-funded and has 27.1 million common shares outstanding. Visit Metallica's web site at www.metal-res.com and send e-mail to metallica@metal-res.com.

THE STATEMENTS IN THIS PRESS RELEASE THAT ARE NOT HISTORICAL FACTS CONTAIN FORWARD-LOOKING INFORMATION. THESE STATEMENTS ADDRESS FUTURE EVENTS INVOLVING KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO VARY MATERIALLY FROM PROJECTED RESULTS. THESE RISKS AND UNCERTAINTIES INCLUDE THOSE DESCRIBED IN METALLICA'S FORM 20-F.