Growth Strategy Continues At Dolores And Projects Advancement 

VANCOUVER, BC – Mark Bailey, President and Chief Executive Officer of Minefinders Corporation, said, "As a result of continued improvement in production, declining cash costs and increasing margins, we have made a good start in 2011. Our cash position continues to grow and we continue to reduce our debt. With precious metals prices at record levels, we are well poised to benefit from current market conditions. We remain focused on executing our growth strategy at Dolores through the assessment of a mill addition and underground expansion options as well as the advancement of the Company’s other development and exploration projects."

Revenue in the first quarter of 2011 was $52.3 million compared to revenue of $26.4 million in the first quarter of 2010. Cash operating cost per gold equivalent ounce sold was $472 in the first quarter of 2011 compared with $609 for the first quarter of 2010. Income from operations increased to $25.8 million in the first quarter of 2011 as compared to $4.0 million in the first quarter of 2010. Net income was $2.3 million in the first quarter of 2011 compared to net income of $10.9 million or in the first quarter of 2010.

Adjusted net income, which reflects net income less changes in the fair value of derivative liabilities that are recorded through profit and loss, was $19.0 million in the first quarter of 2011 compared with an adjusted net loss of $0.4 million in the first quarter of 2010. The Company recorded positive operating cash flow before changes in working capital of $31.2 million compared with positive operating cash flow before changes in working capital of $6.6 million in the first quarter of 2010. At March 31, 2011 the Company had $177.6 million in cash, cash equivalents and short term investments, an increase from $166.9 million at December 31, 2010. Net working capital at March 31, 2011 was $175.8 million, an increase from $167.4 million at December 31, 2010. Long term debt at March 31, 2011, consisting entirely of convertible notes maturing in December, 2015, was $29.7 million, a decrease from $46.5 million at December 31, 2010. During the first quarter of 2011, the $17.0 million outstanding on the Company’s revolving credit facility at December 31, 2010 was repaid with the full $50.0 million facility available at March 31, 2011. The Company expects to meet its cash requirements, including repayment of $52.1 million principal of convertible notes maturing in December 2011 to the extent they are not converted to common shares, from the net proceeds from the sale of gold and silver, working capital on hand and funds available through its revolving credit facility. The Company maintains its production guidance for 2011 of 65,000 to 70,000 ounces of gold and 3.3 million to 3.5 million ounces of silver. Cash operating cost is expected to be between $450 and $500 per gold equivalent ounce sold assuming a 48 to one silver to gold ratio. The Company’s other projects continue to advance on schedule with studies for the mill addition and underground mining at Dolores well advanced. At La Bolsa, permitting is underway and an engineering firm has been contracted to provide detailed engineering for the potential mine. Exploration drilling on Dolores, La Virginia and Babicanora continues and the Company expects to report results in due course. The company’s address is 2288-1177 W. Hastings St.,Vancouver, BC V6E 2K3, (604) 687-6263, fax: (604) 687-6267.