ENGLEWOOD, Colo., Aug. 19 /PRNewswire/ -- Echo Bay Mines Ltd.
(Amex and TSE: ECO) announced today that its Board of Directors has approved
the deferral of final construction decisions on two planned gold mines,
Paredones Amarillos in Mexico and Aquarius in Canada, and deferred further
development of Ulu, a satellite deposit to the Lupin mine in Canada, until the
gold price improves from current 12-year lows.
    Deferral of final construction decisions beyond 1997 would reduce the
company's 1997 capital expenditure requirements to a total of not more than
$49 million from the originally planned $114 million for the two new mines.
The deferral of the Ulu project will reduce planned 1997 capital expenditures
by $4 million.
    At 60%-owned Paredones Amarillos, Echo Bay's share of 1997 capital
expenditures would not exceed $10 million, down from $44 million planned
originally.  Of this, $2 million was spent through June 30.  The remaining
amount to be spent during 1997 will be devoted to detailed engineering work,
permitting activities, water development, and other work required to maintain
the integrity of the project and enable development to proceed quickly and
smoothly to construction at such time as a final construction decision is
made.
    Echo Bay and its 40% joint venture partner at Paredones Amarillos, Viceroy
Resource Corporation (TSE: VOY), estimate that less than $2 million will be
added to the total cost of the project by deferring the final construction
decision at least until early 1998.  This amount is more than offset by a $15
million reduction in capital costs that has been achieved by re-engineering
the mill process flowsheet, including elimination of the cyanide regeneration
circuit; purchasing used equipment; redesigning the site layout; and
optimizing a number of other aspects of the project.
    Echo Bay has also deferred construction activities at the 100%-owned
Aquarius gold mine in the Timmins gold district of Ontario.  Deferral reduces
Echo Bay's 1997 capital expenditure requirements at Aquarius to approximately
$39 million from the originally planned $70 million.  Of that, $12 million was
spent through June 30.  The remaining amount to be spent during 1997 will be
devoted primarily to completion of the frozen underground barrier system.  The
barrier system is being constructed to block groundwater from flowing into the
proposed pit.  Once frozen, the underground "freeze wall" can be maintained
indefinitely at a nominal cost.  Underground freezing is a proven, cost-
effective technology that has been used in tunneling and shaft boring for over
100 years.
    New mining and blasting methods, recently initiated at the Lupin mine in
the Northwest Territory of Canada, are proving successful in reducing waste
rock dilution, improving millhead ore grade and controlling costs.  These
improvements, in conjunction with other cost savings being put in place at the
site, indicate that mining can continue economically below the 1,400 meter
level into mineralization previously identified but considered uneconomical.
A revision of the site's mine plan is being finalized which allows for
deferral of the development of Ulu, a source of supplemental mill feed to
Lupin, with minimal impact on production or costs.  Further details of this
revised mine plan should be available in late 1997.
    The deferral of development of Ulu will limit 1997's capital expenditures
at the site to the $8.5 million already spent, down from the $12.5 million
originally anticipated.  Holding costs for the project are nominal.
    Echo Bay is a major gold producer with mines in Canada and the United
States.  The primary markets for its shares are the American and Toronto stock
exchanges.  Its shares are also listed on stock exchanges in Switzerland,
France, Germany and Belgium.
    "Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995:  The statements herein that are not historical facts are forward-
looking statements.  They involve risks and uncertainties that could cause
actual results to differ materially from targeted results.  These risks and
uncertainties include but are not limited to future changes in gold prices,
which could render projects uneconomic; changes in project parameters as plans
continue to be refined; the results of future exploration activities and new
exploration opportunities; and other factors detailed in the company's filings
with the Securities and Exchange Commission, particularly those on Forms 10-Q,
10-K, 8-K and S-4.

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