International Minerals Reports Strong Pallancata Mine Operating Results

International Minerals Corporation (TSX: IMZ)(SIX: IMZ) reports that the
Pallancata silver mine in Peru increased silver production by
approximately 34% in the calendar second quarter of 2010 ('Q2 2010?) to
2.53 million ounces (1.0 million silver ounces attributable to IMZ)
compared to the second quarter of 2009.

The Pallancata Mine is jointly owned by IMZ (40% interest) and
Hochschild Mining plc ('Hochschild?, 60% interest and operatorship). All
dollar numbers are in U.S. Dollars.

Highlights for Q2 2010 at the Pallancata Mine include:

• 
  Silver production increased from first calendar quarter 2010 ('Q1
  2010?) by 8% to approximately 2.53 million ounces with 1.0 million
  silver ounces attributable to IMZ;
  
• 
  IMZ′s attributable total cash costs per ounce of silver (net of gold
  credit) decreased by 6% to $5.47 from Q1 2010;
  
• 
  Payment of a cash dividend of $15 million (of which IMZ received $6
  million for its 40% interest). Total dividends received by IMZ to date
  in 2010 are $16 million.
  

Stephen Kay, President and CEO of IMZ, stated, 'The Pallancata Mine
continues to perform extremely well both at the production level and on
an operating cost basis. IMZ has received record cash dividends from its
40% ownership in the mine of $16 million so far in calendar year 2010,
compared to $7.6 million for the entire 2009 calendar year, which is a
tremendous achievement.?

Cash Flow

Using a silver price of $16 per ounce, IMZ′s share of cash dividends to
be paid out from the free cash flow from operations at Pallancata for
calendar year 2010 is expected to total approximately $22 million
(including the $16 million received to date), based on the current IMZ
production estimate of approximately 10.0 million ounces of silver and
33,000 ounces of gold for calendar year 2010 (on a 100% basis) and
projected operating costs.

IMZ′s 40% share ($18.4 million) of the projected capital expenditures in
calendar year 2010 of approximately $46 million (primarily for
additional mine development/infrastructure and construction of new
tailings, waste rock and paste backfill facilities) is expected to be
fully-funded by operational cash flow. The $22 million of estimated cash
dividends to be paid this year to IMZ is net of these capital
expenditure requirements.

IMZ uses an equity accounting basis to record its 40% interest in the
Pallancata Mine.

Production

Table 1 below shows that Pallancata′s Q2 2010 silver production compared
to Q1 2010 increased by 8% from 2.33 million ounces to approximately
2.53 million ounces.

For Q2 2010, direct site costs were $2.40 per ounce of silver and total
cash costs were $5.47 per ounce of silver, both after gold by-product
credit. These costs are lower by 22% and 6% respectively compared to Q1
2010, due primarily to higher silver and gold production (and a higher
gold price) realized during Q2 2010.

Table 1: Pallancata Mine Production
Highlights (100% Basis; in US Dollars)

Table 2: Pallancata Mine Production
Highlights (IMZ 40% Share)

Notes to Tables 1 and 2:

1. Head grades for silver and gold are based on the overall
metallurgical balance for the process plant.

2. Difference between
'produced? metal ounces and 'sold? metal ounces is a combination of the
smelter metal payability factors and in-process concentrate. Silver
production figures are rounded to hundreds of ounces.

3.
Direct Site Costs per ounce silver and Total Cash Costs per ounce silver
reflect a 'mined ore inventory adjustment?. IMZ believes that this
calculation more accurately matches costs with ounces of production.
(Also see notes 4 and 5 below.)

4. Direct Site Costs per ounce
silver comprise direct mining, mined ore inventory adjustment, toll
processing and mine general and administrative costs (net of gold
by-product credit).

5. Total Cash Costs, using the Gold Institute′s
definition, comprise: mine operating costs, mined ore inventory
adjustment, toll processing costs, mine general and administrative
costs, Hochschild′s management fee, concentrate transportation and
smelting costs, local and provincial taxes (other than federal income
tax) and the Peruvian government royalty.

The technical information reported in this news release was reviewed by
IMZ′s Qualified Person, VP of Corporate Development, Nick Appleyard.

Hochschild Mining plc does not accept any responsibility for the
adequacy or inadequacy of the disclosure made in this news release and
any such responsibility is hereby disclaimed in all respects.

Cautionary Statement:

The Gold Institute calculation of Direct Site Costs and Total Cash
Costs are non-Canadian GAAP financial measures, which IMZ management
believes are useful in measuring operational performance, and also any
forward-oriented financial information provided may not be appropriate
in relation to Canadian GAAP reporting, which should be referred to in
the Company′s financial reporting. Some of the statements contained in
this release are 'forward-looking statements? within the meaning of
Canadian securities law requirements. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors that
may cause our actual results, performance or achievements to differ
materially from the anticipated results, performance or achievements
expressed or implied by such forward-looking statements. Forward-looking
statements in this release include statements regarding estimates of
production, total cash costs, mine life, resources, cash flow, capital
costs and dividends. Factors that could cause actual results to differ
materially from anticipated results include risks and uncertainties such
as: risks in attaining ramped-up production and processing rates, risks
of cost escalation, risks of estimating mineral resources and reserves,
variances between mineral reserves and actual mineral production and
other risks and uncertainties detailed in the Company′s Renewal Annual
Information Form for the year ended June 30, 2009, which is available at www.sedar.com
under the Company′s name. The Company disclaims any intention or
obligation to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.

International Minerals Corporation

In
North America:

Paul Durham, 1 203-883-8359

Vice
President Corporate Relations

or

In
Europe:

Oliver Holzer, +41 (0) 44 854 11 39

Marketing
Consultant

IR@intlminerals.com

http://www.intlminerals.com