ENGLEWOOD, Colo., Feb. 21 /PRNewswire/ -- Echo Bay Mines Ltd.
(AMEX and TSE: ECO) has increased its equity interest in Minefinders
Corporation Ltd. (VSE: MFL) as part of a strategic alliance through which Echo
Bay has the right to acquire a 60 percent interest in Minefinders' 100
percent-owned Dolores gold exploration property in Chihuahua, Mexico.  The
C$2.3 million transaction provides funding for phase three exploration on the
property following positive results from the second phase of drilling.
    Echo Bay has acquired a further 640,000 common shares of Minefinders by
exercising 400,000 warrants at C$4.00 per share and 240,000 warrants at C$3.00
per share.  The 400,000 warrants exercised were issued as part of the original
transaction between the companies in July 1996.  The 240,000 warrants
exercised were granted as part of a private placement completed in November
1996.
    Upon completion of the transaction, Echo Bay will hold 1,920,000 common
shares of Minefinders, or 20.9 percent of the company's 9.2 million common
shares outstanding.
    Minefinders has agreed that 70 percent of the C$2.3 million generated by
the transaction will be used to continue exploration on the Dolores property.
Further investments in Minefinders will be dependent on results of the
exploration program.
    Forty-five drill holes have been completed at Dolores, a volcanic-hosted
epithermal gold system located in the Sierra Madre Mountains.  Assays have
been received from 36 holes, with significant gold mineralization encountered
in 26 of them.  Mapping and sampling work on the property has identified three
target areas along a northwest-trending mineralized zone that is more than 2.5
miles (4,000 meters) long.  Surface sampling traverses have been completed
throughout this strike length and have encountered good surface gold values.
Previous mining activity in the area is reported to have produced more than
300,000 ounces of gold prior to 1929.
    The strategic alliance on the Dolores property involves the equity
financing by Echo Bay of a phased exploration program jointly planned by both
parties and managed and operated by Minefinders.  Thirty days after the end of
the third phase of exploration, Echo Bay has the option to fund and manage a
feasibility study and become operator of the Dolores property.  Upon
completion of the feasibility study, Echo Bay has the option to purchase a 60
percent joint venture interest in the property and would continue as operator.
The purchase price will be equal to 60 percent of the gold equivalent (gold
and silver) production ounces from the proven and probable reserves as
calculated in the feasibility study at US$20 per ounce, subject to a minimum
of US$12 million dollars.
    Echo Bay is a major gold producer with mines in Canada and the United
States and with exploration and development projects on four continents.

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