Atacama Minerals Announces Completion of Basic Engineering.

VANCOUVER, BRITISH COLUMBIA--(BUSINESS WIRE)--Oct. 6, 1997--Atacama Minerals Cor(VSE AAM.) Atacama Minerals Corp. (the "Company") is pleased to announce it has received the final Phase I Basic Engineering Report on its Aguas Blancas project.

This report was completed by Bateman/Parsons (a joint venture of Bateman Engineering and The Parsons Corporation) in conjunction with reserve, process, mining and transportation studies and represents the most extensive studies conducted to date for the development of Atacama's major new caliche mine and chemical plant near Antofagasta, Chile.

The Bateman Report calls for the construction of a mine and process plant which will process approximately 1.7 million tonnes of ore per year with production commencing in early 1999 and reaching an annual rate of approximately 1,000 tonnes of crude iodine and 300,000 tonnes of sodium sulphate by the year 2000. Seventy thousand tonnes of potassium nitrate will be added to the manufacturing capacity by the year 2004 with the raw materials being supplied from the existing pond system (no additional ore requirements). Iodine is currently priced at U.S. $18.00 per kilogram, sodium sulphate is at U.S. $120 per tonne and potassium nitrate is U.S. $325 per tonne. The initial cost of the process facilities is estimated at U.S. $59 million. Additional support infrastructure such as mine facilities, roads and water supply will add U.S. $13 million to the initial capital costs. Total project costs through to startup in 1999 are projected at slightly over U.S. $100 million, including contingencies.

Revised financial models indicate that at current market prices, the Company would generate sales of approximately U.S. $55 million annually. This would increase to U.S. $75 million when the potassium nitrate line is brought on stream. Net pre-tax income is projected at U.S. $31 million (before depreciation) increasing to U.S. $41 million with potassium nitrate production. New reserve studies indicate project resources of a least 21 years of production. The internal rate of return on a 100 percent equity basis exceeds 25 percent.

Commenting on the completion of these studies, the President of the Company, Mr. Robert S. Cogliandro stated, "The finalization of the Basic Engineering Report and reserve studies represents a major achievement for the Company in the development of the Aguas Blancas project. The pre-construction studies have now been successfully completed. Our objective has been to complete the design of a first class, high efficiency facility which would operate with outstanding performance economics in the challenging environmental conditions of the Atacama Desert. This objective has been met. We will be moving into detailed engineering by November and remain on track to begin construction early in 1998. We are fully committed to delivering product to our customers by early 1999."

Atacama Minerals Corp. is completing the design and construction of its Aguas Blancas plant through its Chilean subsidiary, Minera Teslin Ltda. Located in Region II, approximately 95 kilometres from the Port of Antofagasta, Aguas Blancas sits in the heart of the Chilean nitrate belt. The property is extremely rich in iodine and sodium sulphate and also contains exploitable quantities of sodium nitrate (which will converted to potassium nitrate). With the completion of basic engineering, the Company will begin detailed design with earthwork construction slated for January, 1998. An extensive water well drilling program has been underway since February and has been very successful. Final negotiations for project debt financing have commenced and the Company expects to announce the results of these discussions shortly.

On completion of the process facility, the Company will become a major regional supplier of high purity detergent grade sodium sulphate and an important new supplier of crude iodine which has been in short supply on a worldwide basis.

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CONTACT: Atacama Minerals Corp.

Sophia Shane, 604/689-7842

604/689-4250 (FAX)