updated 9/1/2010 8:20:05 AM ET 2010-09-01T12:20:05

BEIJING, Sept. 1, 2010 (GLOBE NEWSWIRE) -- Silver Dragon Resources Inc. (OTCBB:SDRG) ("the Company") is pleased to announce further progress from recently completed drilling work at the Company's Laopandao Silver-Tin-Copper-Lead Polymetallic project in Inner Mongolia, Northern China.

Since 2009, an advanced drilling program has been carried out at the main exploration target, Mineralization Zone III, on the southwest part of the Laopandao property. To date, 14 drill holes have been completed at Mineralization Zone III. Highlights of the latest discoveries are as follows:

  • In 2010, eight drill holes were completed in Mineralization Zone III, all of which hit multiple tin subzones.
     
  • Assay results of drill holes ZK3042 and ZK3043 at exploration line 304 have become available, and revealed significant tin mineralization.
     
  • Drill hole ZK3042 revealed 15 tin (Sn) subzones. High-grade tin occurs from 22.3m to 22.9m, at 0.9%. From 344.5m to 345.3m, a grade of 1.68% tin was discovered, and from 354.5m to 355.7m, 2.01% tin.
     
  • Drill hole ZK4033 revealed five tin subzones. Among them, the most significant (No. 1) occurs at depths of 29.6m to 40.8m. It is 11.2m wide with average grades of 3.14 g/t Ag, 0.027% Cu, and 0.646% Sn. The highest grade tin occurs from 34.6m to 35.1m (1.90% tin) and 35.1m to 36.1m (1.22% tin).

In 2009, six drill holes revealed significant tin mineralization as well (see press release dated May 4, 2010). To further probe the extensions of this mineralization, the aforementioned eight diamond drill holes were designed and completed in 2010. All of the eight new holes (3,977 meters in total) hit multiple tin mineralization subzones. To date, assay results of just two of the eight drill holes (ZK3042 and ZK3043) have become available, highlighted above and below.

In accordance with China's national exploration standards, the industrial cutoff grade of tin is 0.1%, the minimum minable thickness of the ore body is about 0.8m, and the maximum thickness of the host rock is 2m. 

Drill hole ZK3042, positioned (X:4825376,Y:20550610,H:1698m) at exploration line no. 304, is 450m deep with 180 degrees azimuth and 83 degrees dip angle. Based on the above industrial  parameters, 15 mineralization subzones have been identified in this drill hole (See Table 1). These mineralization subzones can be divided into three groups based on their occurring depths:

The first group occurs from 11.0m to 100.7m, consisting of five mineralization subzones. Among them, the most significant tin mineralization occurs in subzone no. 1 (1.8 meters wide averaging 1.2 g/t Ag, 0.002% Cu, and 0.247% Sn) and subzone no. 2, (4.2m wide averaging 4.46 g/t Ag, 0.07% Cu, and 0.249% Sn).

The second group occurs from 117m to 238m, consisting of seven mineralization subzones. Among them, the most significant tin mineralization occurs in subzone no. 8 (4.7 m wide averaging 1.2g/t Ag, 0.015% Cu, and 0.142% Sn), subzone no. 10 (3.8m wide averaging 1.82 g/t Ag, 0.06% Cu, and 0.15% Sn), and subzone no. 12 (3.0m wide averaging 2.33 g/t Ag, 0.025% Cu, and 0.15% Sn).

The third group occurs from 324m to 357m, consisting of three mineralization subzones. Significant tin mineralization occurs in subzone no. 13 (4.3m wide averaging 1.59 g/t Ag, 0.02% Cu, and 0.315% Sn), subzone no. 14 (3.4m wide averaging 1.08 g/t Ag, 0.01% Cu, and 0.74% Sn), and subzone no. 15 (3.1m wide averaging 3.03 g/t Ag, 0.01% Cu, and 0.83% Sn). High-grade tin occurs from 22.3m to 22.9m (0.9%), from 344.5m to 345.3m (1.68%), and from 354.5m to 355.7m (2.01%).

Drill hole ZK3043, positioned (X:4825284,Y:20550604,H:1701m) at exploration line no. 304,  is 379.65m deep with 180 degrees azimuth and 85 degrees dip angle. Based on the aforementioned industrial parameters, five mineralization subzones have been identified (See Table 2), including two groups of mineralization subzones based on their occurring depths.

The first group consists of tin mineralization subzone no. 1, which has the most significant tin mineralization. This subzone occurs from 29.6m to 40.8m. It is 11.2m wide with average grades of 3.14 g/t Ag, 0.027% Cu, and 0.646% Sn. The highest-grade tin occurs from 34.6m to 35.1m (1.90%) and 35.1m to 36.1m (1.22%).

The second group consists of four mineralization subzones, extending from 130.7m to 252.4m. Among them, mineralization subzone no. 4, at 2.6m wide averaging 1.15 g/t Ag, 0.017% Cu, and 0.118% Sn, is the most significant.

Analyzing these latest findings, it can be concluded that drill holes ZK3042 and ZK3043 have revealed significant tin mineralization. Combined with the exploration results from drill hole ZK3041, which was completed in 2009, the assay results of the three holes indicate continued and strong tin mineralization along exploration line no. 304. The multiple tin mineralization subzones occur in various depths ranging from near surface to 300m deep. Each tin mineralization subzone has industrial values, especially the near surface mineralization subzones (less than 100m deep), which are thicker and higher in tin grades.

Currently, a tunneling exploration project is also being carried out (see PD3 and dashed lines in Fig. 1).  The ore drift (YM 3, which is 278m long) has been completed. Two transverse drifts have been started and are expected to hit the mineralization zones. 

More achievements will be reported as further assay results from the other drill holes become available.

Dr. Tiebing Liu, P. Geo., a "qualified person" within the meaning of NI 43-101, reviewed and participated in the preparation of the technical information disclosed in this news release.

To see charts of tin (Sn) prices and inventory, please go to the following URL: http://www.metalprices.com/FreeSite/metals/sn/sn.asp

Please visit www.silverdragonresources.com to see full press release with images, figures and tables.

Notes:

  • The core sampling method is sawing the core in half for assaying, with the other half being put in a storage box with a red marker. The length of each sample varies from 0.5m to 1.0m, depending on mineralization and lithology. In a drift or trench, the channel sampling method (10cm x 3cm x sample length) is used.
  • The industrial cutoff grades are 80 g/t Ag, 0.7% Pb, 1% Zn, 0.2% Cu, and 0.1% Sn.
  • All assay data were made by ordinary chemical methods in Yanjiao Central Laboratory of North China Nonferrous Geological Survey Bureau.

Please visit www.silverdragonresources.com to see full press release with images, figures and tables.

About Laopandao

Laopandao is one of the six exploration properties of Sanhe Sino-Top Resources and Technologies Ltd. ("Sino-Top"), a Chinese company that holds exclusive exploration rights to these properties, located in the prolific Erbahuo Silver District in Inner Mongolia, China. Silver Dragon Resources Inc. has a 40% ownership interest in Sino-Top. The Laopandao exploration area covers 44.88 square kilometres and is located approximately 650 kilometres north by northeast of Beijing in Chifeng, Inner Mongolia (see Project location Map at http://www.silverdragonresources.com/_gui/China_Project_Location_Map.jpg ). Mineralization zones have been identified in the northern, central, and southern portions of the exploration area. The most significant recent discovery was the existence of Ag-Sn-Cu-Pb mineralization on the peripheries of a previously identified tin mineralized zone. The mineralization is mainly a continental volcanic-sedimentary rock altered strata-bound mineral type.

Silver Dragon and its Chinese Joint Venture partners are currently implementing a major surface and underground exploration program at Laopandao during the 2010 exploration season, consisting of 5,160 metres of diamond drilling, 1,300 metres of underground exploration-development and 1,000 metres of trenching to define the resource potential on the property culminating in the preparation of a preliminary assessment by Q4-2010.  As of today, 4,695.79 metres of drilling (11 holes) and 388.2 metres of tunneling have been completed since the start of the current year.

The Company has retained Southampton Associates Inc. of Toronto, Canada, to prepare a National Instrument 43-101 report on the Laopandao Property, as well as to evaluate the viability of a central mill complex to process future production from the Dadi Polymetallic-silver Property and the Laopandao Property.

About Sino-Top – China Mining 2009 Award Winner*

Sanhe Sino-Top Resources & Technologies, Ltd. ("Sino-Top'') was originally incorporated in 2003 as a Chinese company wholly-owned by Huaguan Industrial Corp. ("HIC''), a subsidiary of the state-owned North China Geological Exploration Bureau. Sino-Top became an American-Chinese joint venture in 2005. Silver Dragon Resources Inc. acquired Sino-Top in 2006, and currently owns 40% of Sino-Top after having sold 50% of its ownership interest to its Chinese partners. The Chinese side, led by Gansu Shengda Group Ltd. ("Shengda"), at 52%, and HIC, at 8%, collectively own 60% of Sino-Top. Sino-Top holds exclusive exploration and development rights to six properties in northern China (Inner Mongolia), covering a total area of 139 km2.  Sino-Top won the prestigious Prospector/Explorer of the Year Award for its Dadi Silver Polymetallic Project at the China Mining Congress & Expo 2009 held in Tianjin, China, during October 20-22, 2009.

About Silver Dragon Resources Inc.:

Silver Dragon Resources Inc. is a mining and metals company focused on the exploration, acquisition, development and operation of silver mines in proven silver districts globally. Silver Dragon's objective is to acquire silver mining assets that contain promising exploration targets, have highly leveraged, out-of-the-money silver deposits, and/or are producing properties with significant untapped exploration potential. It is management's objective to grow Silver Dragon into a significant silver producer by developing the Cerros las Minitas project in Mexico, its six Sino-Top properties in China (particularly Dadi and Laopandao), and its Erbahuo Silver mine (via its Chifeng Silver Dragon subsidiary), also in China. For more information, please visit the Company's website at: www.silverdragonresources.com (now available in Chinese).

The Silver Dragon Resources Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4242

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained herein which are not historical, such as statements regarding the exploration and development of the Laopandao and Dadi Silver Project, outcome and timing for the completion of further assays and metal amounts in partial assay results, are forward-looking statements.  Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "aims," "potential," "goal," "objective," "prospective," and similar expressions, or that events or conditions "will," "would," "may," "can," "could" or "should" occur. Information inferred from the interpretation of assay results and information concerning mineralization zones may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, certain delays beyond the company's control with respect to future assay results, delays in testing and evaluation of assays, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.

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