Investors

BEIJING, CHINA --- Pacific Minerals announced today that it has signed a memorandum of understanding with the Yunnan Geology & Mineral Resources Co. Ltd. (YGMRC) that gives Pacific Minerals the exclusive right until September 1, 2004, to form a joint venture on YGMRC's Zhongdian copper-gold porphyry project in northwestern Yunnan Province, China. The joint venture is subject to Pacific Minerals' geologic review of the project.

Regional exploration by YGMRC on the 730-square-kilometre project has outlined more than a dozen prospects containing porphyry copper-gold, skarn copper-gold and epithermal gold mineralization. Some of the skarns contain high-grade copper, with associated gold grading up to four grams per tonne (g/t). YGMRC also has identified several gold-bearing porphyry systems on the project. Initial work on one system identified more than 30 metres of copper porphyry mineralization grading greater than 1.3% copper and 0.4 g/t gold within an extensive zone of lower-grade mineralization.

"The project offers significant scope for the discovery of large, porphyry copper-gold deposits," said Mike Page, Pacific Minerals' Vice-President. "The style and scale of mineralization are similar to some of the great porphyry copper-gold districts such as Bingham Canyon, in the US, and Oyu Tolgoi, in Mongolia."

To date, YGMRC has drilled only the Pulang prospect at the Zhongdian project. A variety of mapping and surface geochemical survey work has been completed on the remainder of the project, with some surveys indicating extensive areas of anomalous gold. Four new prospects have been discovered this year.

Three known deposits within the defined area are excluded from Pacific Minerals' area of interest:

• The Xuejiping porphyry copper mine, which produces 200 tonnes/day from quartz diorite and quartz monzonite porphyries. Ore zones are between 30 and 80 metres thick and grade 0.63% Cu, 0.06 g/t Au.
• The Hongshan skarn-porphyry copper mine, which produces 200 tonnes/day. Ore zones are between four and 20 metres thick and grade 1.01% copper, including high-grade ores grading 1.54% Cu.
• The Pulang prospect, a 30 km2 area previously optioned out by YGMRC.

Ivanhoe Mines has the right to earn up to 80% of Pacific Minerals' interest that it acquires in the Zhongdian project, as per the conditions set out in a project participating agreement between Pacific Minerals and Ivanhoe Mines.

Mike Page, a qualified person as defined by National Instrument 43-101, supervised the preparation of the information in this release.

Pacific Minerals is focused on the exploration and development of precious and base metals (gold, copper, nickel, and platinum group metals) in China and Mongolia. Pacific Minerals' most advanced projects are the 217 Gold Project in Inner Mongolia and the JBS Platinum/Palladium Project in Yunnan Province. The company also is conducting exploration work on prospective properties in Yunnan, Liaoning, Guizhou and Inner Mongolia, in China.

Investors: Bill Trenaman/ Media: Bob Williamson: +1.604.688.5755
Email: [email protected] Website: www.pacific-minerals.com

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy or this release.

Forward-Looking Statements: Statements in this release that are forward-looking statements, including the planned exploration and development of mineral projects in China, are subject to various risks and uncertainties concerning the specific factors disclosed under the heading "Risk Factors" and elsewhere in the company's periodic filings with Canadian securities regulators. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The company does not assume the obligation to update any forward-looking statement.