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Balabag Project Update: TVI Pacific receives Balabag scoping study

July 17, 2008

    -   Scoping Study Recommends Undertaking Comprehensive Exploration and
        Full Feasibility Work Program to Enable a Development Decision in
        Respect of the Balabag Project

    (TSX: TVI)

    CALGARY, July 17 /CNW/ - TVI Pacific Inc. (TSX: "TVI" or the "Company")
announced today that it has received a comprehensive scoping study (prepared
in accordance with National Instrument 43-101 - Standards of Disclosure for
Mineral Projects) respecting the Balabag epithermal gold project, which is
located near the municipalities of Bayog, Zamboanga Del Sur, and Diplahan,
Zamboanga Sibugay, Philippines. A copy of the study will be filed within 45
days of this News Release with certain securities regulatory authorities in
Canada and will be available on the SEDAR website at www.sedar.com. The study,
entitled Scoping Study of the Balabag Project, was prepared by Genivar Limited
Partnership of Montreal, Quebec, Canada ("Genivar").

    Certain statements in this News Release constitute forward-looking
statements, including statements concerning the estimated time required to
undertake certain feasibility work at Balabag and estimates of the time
required to undertake construction activities at Balabag in the event a
production decision is reached by the Company in respect of the project.
Readers should refer to the cautionary statement that appears at the end of
this News Release.

    The purpose of the Scoping Study was to assess the mining potential of a
stand-alone commercial scale mining operation centered on the currently
delineated Balabag deposit and to provide an order of magnitude of its
economic potential. Management and the Board of Directors of the Company are
encouraged by the Balabag Scoping Study, which supports their conclusion that
the preparation of a comprehensive exploration and feasibility work program is
warranted - to further assess the resource and reserve models and to provide
additional engineering, environmental, socio-political and commercial site
    Significant information and assumptions (base case models) set out in the
Balabag Scoping Study include the following:

    (US$)                           Base Case 1                  Base Case 2
                                  (O/P & U/G)(*)               (O/P & U/G)(*)
    Total Capital
     costs:          $38.8 M (10% contingencies)  $58.1 M (10% contingencies)
    Avg. Production
     rate:                        1,300 / 6 yrs                1,450 / 5 yrs
    Cut-off grade:                0.48 gpt AuEq                0.44 gpt AuEq
     production:    2,803,729 tonnes (O/P & U/G) 2,579,052 tonnes (O/P & U/G)
    Average grade
     (diluted):       3.94 gpt AuEq; (O/P & U/G)   3.95 gpt AuEq; (O/P & U/G)
    Gold Price:                     650.00 $/oz                  900.00 $/oz
    Silver Price:                    13.00 $/oz                   17.00 $/oz
    Discount Rate:                         10 %                         10 %
    Cash costs per Oz Au Eq:      312 $/oz AuEq                397 $/oz AuEq
    Total Operating Costs:              $96.1 M                     $110.7 M
    Total Income (Before Tax):         $100.5 M                     $134.5 M
    Net Project CF (Aft Tax):           $45.0 M                      $58.1 M
    Net Present Value (Aft Tax):        $19.8 M                      $36.1 M
    Internal Rate of return:             31.9 %                       45.8 %
    Payback Period:                   3.1 years                    2.2 years

    (*) O/P means open pit mining operations; U/G means underground mining
        Gold Equivalent ("AuEq") values were calculated using $650/oz Au and
        $13/oz Ag for Base Case 1 and $900/oz Au and $17/oz Ag for Base
        Case 2.
        The foregoing is a summary only of certain information contained in
        the Balabag Scoping Study. Readers should refer to that report, when
        filed, for additional details concerning the information set out in
        this News Release.

    Readers are cautioned that the Balabag Scoping Study is preliminary in
nature and includes inferred mineral resources that are considered too
speculative geologically to have the economic considerations applied to them
that would enable them to be categorized as mineral reserves. There is no
certainty that the Balabag Scoping Study assessment will be realized and
actual results may vary substantially.

    "We are very pleased with the results of the Balabag Scoping Study, which
provides additional support for management's high priority view of the
project," said Clifford M. James, TVI President and CEO. "This preliminary
assessment, based on mineralization found on the Balabag property to date,
reinforces our conclusion that further work should be undertaken to examine
the potential for a stand-alone, commercially viable mining operation and
perhaps the second production project for the Company. We intend to move
quickly towards a full feasibility study, which will be required to enable us
to make a production decision on the project."

    Additional Information

    The tenements covering the Balabag property comprise a Mineral Production
Sharing Agreement ("MPSA") originally held by Zamboanga Minerals Corporation
("ZMC") and covering a total area of 4,779 hectares. TVI Pacific, through its
Philippine affiliate TVI Resource Development (Phils.) Ltd. ("TVIRD"), has
since exercised its option to purchase, and has purchased from ZMC, the full
rights and obligations of the Balabag property.
    The Balabag mineral prospect is located on a 1.5 km by 1 km ridge,
defining a structurally controlled area consisting of a series of vein bodies
occurring in tuffaceous agglomerate and andesitic rocks, bordered to the north
and south by NW-SE regional faults. Data collected to date suggests a system
of veins running east-westerly and gently dipping 30degrees- 40degrees to the
north. The Tinago vein system appears to be the largest and most strongly
mineralized structure. The existing data indicates that mineralization is
strongest from section 4E to 4W (some 400m along strike) where the vein swell
is most prominent. The latest interpretation based on detailed mapping and
infill drilling suggests that the Miswi vein is likely the eastern extension
of the Tinago system which appears truncated and displaced by post
mineralization faulting. The Miswi vein appears to remain open to the east and
at depth. The Lalab vein system, occurring some 200m west of Miswi, appears to
be smaller and thinner, and somewhat sub-parallel to the Tinago vein. The
Tinago and Lalab veins are interpreted to remain open to the west and at
depth, yet appear to decrease progressively further west. The geometry and
emplacement of mineralization suggest the use of an open pit approach, to be
developed along side Balabag Hill, coupled with minimal underground
development to reach the deeper ore shoots not included in the pits.
    A mineral resource estimate, prepared by P.J. Lafleur Geo-Conseil Inc.
("PJLGCI") in 2007, was based on the 69 drill hole program first completed to
the end of March 2007. Indicated resources were estimated by PJLGCI at 1.37
million tonnes ("Mt") averaging 2.9 grams per tonne ("gpt") Au and 84.3 gpt
Ag, or 203,700 gold equivalent ounces ("AuEqOz"), with additional Inferred
resources amounting to 1.96 Mt averaging 2.6 gpt Au and 55.2 gpt Ag, or
234,200 AuEqOz, using a (greater than)0.5 g /t cut-off. An updated National
Instrument 43-101 ("NI 43-101") Technical Report, detailing the project and
Mineral Resource estimate protocols, was filed on SEDAR on August 9, 2007, and
readers are referred to that technical report for additional information.
Readers are cautioned that mineral resources that have not been classified as
mineral reserves do not have demonstrated economic viability.

    In the Balabag Scoping Study, Genivar considered two "base cases".

    The first base case ("BC1") considers an open pit mining approach
complemented with underground operations for the deeper Tinago and Miswi vein
system. The economic assessment prepared by Genivar assumes a mine plan that
was configured using a block model provided by PJLGCI and utilizes data from
TVIRD's Canatuan operation and empirical data from Genivar's project database
for CAPEX and OPEX.
    Several pit shells where generated using different gold and silver price
values and initial mining /milling estimated operating costs. Dilution factors
were impounded on the resources ranging from zero to +50%. For the purposes of
BC1, ore production and milling rates were initially assumed to be 1,200
tonnes per day ("tdp") and averaging 1,300 tpd over the life of the mine. A
pit shell using a 30% factor of dilution to the resources was utilized as
being the most optimal pit. Annual ore production was assumed to be
approximately 438k tonnes, starting in the third quarter of "Year -1", for
total assumed production of 2.80M tonnes over a period of six years. The open
pit overall stripping ratio is estimated at 4.5 to 1.
    An alternative scenario ("BC2") was also prepared based on the same
estimated resources and using the same optimized pit configuration as BC1, but
integrating updated cost factors and metal prices and utilizing an increased
assumed production rate of 1,450 tpd, resulting in a project mine life of
about 5 years. BC2 provides a comparative financial analysis, using updated
modeling criteria, resulting in improved economics and allowing a test of the
sensitivity of the project to varying factors and parameters. Total production
from the BC2 mining scenario was assumed to be approximately 2.58M tonnes over
a period of 5 years, with an overall stripping ratio of 4.5 to 1.
    Both base cases are preliminary in nature and a definitive feasibility
assessment will need to be completed to enable the management and board of
directors of the Company to make a production decision in respect of the
Balabag Project. This feasibility work is expected to entail (i) additional
exploration drilling, resources /reserves modeling and pit optimization; (ii)
detailed engineering bids and costing reviews; and (iii) geotechnical,
environmental and socio-political baseline studies (to document EIS work and
ECC applications). Management estimates that it will take between 16 and 24
months to complete such feasibility work. Genivar has recommended that such
feasibility work be undertaken at the earliest opportunity in order to secure
all necessary operating permits and to enable the Company to reach a
production decision in a timely manner.
    Once a production (investment) decision has been reached, the
construction time (pre-production period) for either of the base case
scenarios is estimated to be approximately twenty four (24) months. Management
of the Company believes that this period could be shortened, by as much as
eight months, should a commitment be made by the Company to rehabilitate an
existing logging road in order to provide access to the site much sooner.
    To complete a definitive feasibility assessment on Balabag, Genivar
recommends a number of follow up work programs which include (but are not
limited to):

    -   Prepare a program and carry out infill drilling on the Tinago-Miswi
        deposits to assess whether "Inferred resources" can be recategorized
        as "Measured and Indicated resources";
    -   Pursue exploration and prepare and carry out condemnation drilling to
        assess the presence of any new zones of potential mineralization and
        avoid interference between the deposits and the proposed surface
        infrastructure (such as roads, milling facilities and tailings
    -   Prepare and send RFP's to suppliers and mining contractors to obtain
        budget proposals;
    -   Carry out further metallurgical test work and assess the impact of
        those tests on estimated operating costs and metal recoveries;
    -   As a parallel side study, investigate the potential and feasibility
        of running commercial heap leaching operations at the site;
    -   Conduct tailings impoundment site selection and characterization, dam
        design and engineering studies;
    -   Prepare and document a Environmental Impact Statement and apply for
        and secure an Environment Compliance Certificate for the project;
    -   Prepare and document socio-political baseline studies and draft a
        "local community and IP - TVIRD Agreement" to seek and obtain
        clearances to build the project; and
    -   Develop a mine closure plan and comprehensive reclamation and
        rehabilitation program to be implemented after operations have been

    About TVI Pacific Inc. (TSX: TVI)

    TVI Pacific Inc. is a publicly traded Canadian mining company focused on
exploring for and producing precious and base metals within district scale
systems in the Philippines. The Company's interest in the Canatuan Mine and
its other Philippine assets are held through its affiliate, TVI Resource
Development (Phils.) Ltd. ("TVIRD").

    Mr. Marc Beauvais, Eng, P. Eng. of Genivar Limited Partnership, has
served as the "Qualified Person" (for the purposes of National Instrument
43-101 - Standards of Disclosure for Mineral Deposits) in respect of the
Balabag Scoping Study. Mr. Beauvais has reviewed this news release at the
request of TVI. Mr. Beauvais is independent of TVI Pacific for purposes of
National Instrument 43-101.

    Certain information set out in this News Release constitutes
forward-looking information. Forward-looking statements are often, but not
always, identified by the use of words such as "seek", "anticipate", "plan",
"continue", "estimate", "expect", "may", "will", "intend", "could", "might",
"should", "believe" and similar expressions. Forward-looking statements are
based upon the opinions and expectations of management of the Company as at
the effective date of such statements. Although the Company believes that the
expectations reflected in such forward-looking statements are based upon
reasonable assumptions, it can give no assurance that those expectations will
prove to have been correct. Forward-looking statements are subject to certain
risks and uncertainties (known and unknown) that could cause actual outcomes
to differ materially from those anticipated or implied by such forward-looking
statements. These factors include, but are not limited to, such things as the
volatility of prices for precious metals and base metals, commodity supply and
demand, fluctuations in currency and interest rates, inherent risks associated
with the exploration and development of mining properties, ultimate
recoverability of mineral reserves, timing, results and costs of exploration
and development activities, availability of financial resources or third-party
financing, new laws (domestic or foreign), changes in administrative practices
and changes in exploration plans or budgets. Accordingly, readers should not
place undue reliance upon the forward-looking statements contained in this
News Release and such forward-looking statements should not be interpreted or
regarded as guarantees of future outcomes. Forward-looking information
respecting the time required to undertake certain feasibility work at Balabag
is based upon the time required to undertake certain exploration activities at
Balabag to date, management's experiences with other feasibility work programs
undertaken in the Philippines and elsewhere, advice received from third-party
advisors with respect to the timing of various components of the feasibility
work program and the Company's current budget and overall strategy for
Balabag, which plans, budget and strategy are all subject to change.
Forward-looking information concerning the estimated time required to
undertake construction activities at Balabag (in the event a production
decision is reached by the Company in respect of the project) is based upon
management's experiences with other construction projects in the Philippines
and elsewhere, advice received from third-party advisors with respect to the
timing of various components of the construction project, and the Company's
current budget and overall strategy for Balabag, which plans, budget and
strategy are all subject to change. The forward-looking statements of the
Company contained in this News Release are expressly qualified, in their
entirety, by this cautionary statement. Various risks to which the Company is
exposed in the conduct of its business (including exploration activities) are
described in detail in the Company's Annual Information Form for the year
ended December 31, 2007, which was filed on SEDAR on March 27, 2008 and is
available under the Company's profile at www.SEDAR.com. Subject to applicable
securities laws, the Company does not undertake any obligation to publicly
revise the forward-looking statements included in this News Release to reflect
subsequent events or circumstances.

    The Toronto Stock Exchange has neither approved nor disapproved of the
    information contained herein.

For further information: Clifford M. James, President and CEO, (403)
265-4356; Paul Moon, Director, Corporate Communications, (403) 265-4356