Coeur d’Alene Mines, Bolnisi Gold and Palmarejo Silver and Gold have entered into agreements, which have been approved unanimously by their respective boards of directors, as well as a special committee of independent directors of the Palmarejo board of directors, to merge creating the world’s leading primary silver producer. Pursuant to the agreements, Coeur will acquire all of the shares of Bolnisi and all of the shares of Palmarejo not owned by Bolnisi, in a transaction valued at around $1.1 billion.

Under the terms of the transaction, Bolnisi shareholders will receive 0.682 Coeur shares for each Bolnisi share they own (or, at the election of the Bolnisi shareholder, CHESS Depositary Interests representing Coeur shares), and Palmarejo shareholders will receive 2.715 Coeur shares for each Palmarejo share they own. It is anticipated that this will result in Coeur issuing a total of around 271.3 million new shares. In addition, Bolnisi and Palmarejo shareholders will receive a nominal cash payment equal to A$0.004 ($0.003) per Bolnisi share and C$0.004 ($0.003) per Palmarejo share.

Bolnisi and Palmarejo currently own 100% of the Palmarejo project in Chihuahua State, Mexico. The Palmarejo project is one of the highest-quality primary silver projects in the world today, to which Coeur believes it can create significant additional value by leveraging its extensive exploration, development and underground and open pit mining expertise.

The transaction will create a combined entity that expects to realize several significant strategic benefits, including:

• Leading silver producer – upon completion of the transaction and following commencement of production at the Palmarejo project, Coeur will be positioned as the world’s leading primary silver producer in terms of silver production and silver resources. Based on Palmarejo mineral resource estimates and all the metallurgical and mining studies completed to date, Palmarejo is constructing a 2 Mt/y processing plant capable of producing 12 Moz/y of silver and 110,000 oz/y of gold, which Coeur expects would nearly double its current production levels. As a result of this transaction, Coeur is expected to:

• Produce some 32 Moz of silver and around 290,000 oz of gold in 2009 – silver production accounting for about two-thirds of total production by value based on analyst consensus metal prices for 2009

• Possess a mineral resource base of over 364 Moz of measured and indicated silver mineral resources (inclusive of silver mineral reserves) and 96.6 Moz of inferred silver mineral resources and 3.4 Moz of measured and indicated gold mineral resources and 0.95 Moz of gold inferred mineral resources

• Have a leading growth profile with silver production compound annual growth of about 47% between 2007 and 2009

• Continue its no-hedge silver policy, maximizing leverage to silver prices.

• Well-diversified portfolio – Coeur owns and operates three silver mines in North America and South America, owns all of the silver production and mineral reserves of two operating mines in Australia, and is constructing a new silver mine in Bolivia and a new gold mine in Alaska. The addition of the Palmarejo project to Coeur’s portfolio will geographically diversify Coeur’s asset mix and provide entry into a prolific mining area of Mexico, which is the world’s second largest silver producing country

• Increased exploration potential – the combination of Coeur’s prospective exploration portfolio and the Palmarejo properties is expected to provide considerable exploration upside potential for shareholders

• Low-cost producer – the Palmarejo project’s anticipated low operating costs are expected to materially reduce Coeur’s overall cash costs, making Coeur a competitive low-cost producer in the sector. Following the commencement of production at the Palmarejo project, Coeur anticipates that its operating costs will be below $2/oz of silver (after by-product credits)

• Sector leading liquidity – Coeur is currently listed on both the NYSE and TSX, and, in connection with the transaction, Coeur intends to seek listing of its shares on the ASX in the form of CHESS Depositary Interests. Coeur expects to remain one of the world’s most liquid publicly-traded silver mining companies

• Strong balance sheet – based on Coeur’s, Bolnisi’s and Palmarejo’s balance sheets as at December 31, 2006, the pro forma cash position of the combined company would be $382 million, which is expected to be sufficient to fund all three growth projects – San Bartolome, Kensington and Palmarejo – without further equity dilution.

Dennis E. Wheeler, Coeur’s Chairman, President and CEO: "With this transaction we are establishing Coeur as the clear leader in the silver mining industry. Coeur will have an unrivaled platform of silver mines and projects, which we expect to provide substantial growth at low cost. In addition, we have performed substantial due diligence on the Palmarejo project and are pleased to be making a substantial strategic investment in Mexico. We believe that we can add substantial value, leveraging our development, operational and exploration expertise to the Palmarejo project. The Board of Directors and I are excited about the future of the combined company, and we look forward to delivering the significant benefits of the combination to all of our shareholders."

Norman A. Seckold, Executive Chairman of Bolnisi: "We are very excited about today’s announcement. This transaction provides our shareholders with immediate value for their shares as well as the opportunity to participate in the upside potential of what we believe will be the world’s premier silver producer. By leveraging Coeur’s expertise in underground and open cut project development, we expect to realize the full value of the Palmarejo project."

David Fennell, Chairman of the Special Committee of independent directors of Palmarejo: "The Special Committee has undertaken a comprehensive review of the transaction, including seeking advice from both our financial advisor and legal counsel, and has received a fairness opinion from its financial advisor. The Special Committee also retained a separate and independent financial advisor to complete a formal valuation in connection with the transaction as contemplated by Canadian securities laws. After careful consideration, the Special Committee has unanimously recommended approving the transaction to the Palmarejo board of directors, who have in turn approved entering into the agreement. Furthermore, the Palmarejo board, on the recommendation of the Special Committee has authorized the submission of the arrangement to Palmarejo shareholders for their approval at a special meeting of shareholders and the Palmarejo Board unanimously recommends that Palmarejo shareholders vote in favour of the transaction."

The Palmarejo tenement covers around 12,160 ha and the current development project is located on one of 14 silver targets identified to date on the tenement. The Palmarejo project lies in Mexico’s premier silver region, the gold-silver belt of the Sierra Madre Occidental.

Construction of the Palmarejo Project began during September 2006. Based on Palmarejo mineral resource estimates and all the metallurgical and mining studies completed to date, Palmarejo is constructing a 2 Mt/y processing plant capable of producing 12 Moz/y of silver and 110,000 oz/y of gold, nearly equal to the 13 Moz of silver and 136,000 oz of gold expected to be produced by Coeur in 2007. Coeur and Palmarejo will form a joint management committee to oversee progress on the Palmarejo project pending completion of the transaction. The joint management committee will pursue an optimization scenario based on Coeur’s plan for a combined open pit and underground development targeting enhanced project economics, with first production expected in late 2008.

Coeur d’Alene Mines is one of the world’s leading primary silver producers and a growing gold producer. The company has mining interests in Alaska, Argentina, Australia, Bolivia, Chile, Nevada and Tanzania.

Bolnisi Gold is an Australia-based company engaged in mining and exploration for gold and minerals. The company’s activities are all Mexican precious metals operations with an existing portfolio of projects, which include the Palmarejo silver-gold project (including Trogan) in Chihuahua State, the Yecora gold-silver project in Sonora State and the El Realito gold-silver project in Chihuahua State.

Palmarejo Silver and Gold is a silver/gold exploration company listed on the TSX Venture Exchange. Palmarejo’s principal activity is to explore and develop gold and silver properties located in the Temoris District of Chihuahua, Mexico within the Sierra Madre Occidental mountain range.