Pan American Goldfields Ltd Announces Operations Update at the Cieneguita Gold-Silver Project

By Pan American Goldfields Ltd, PRNE
Sunday, October 10, 2010

Installation of Ball Mill and Additional Flotation Capacity Expected to Increase Production Rate and Recoveries

BROOMFIELD, Colorado, October 11, 2010 - Pan American Goldfields Ltd (OTCBB:"MXOM") (the "Company") is pleased to
announce that the installation of the ball mill and additional flotation
capacity has been completed at the Cieneguita project mill in Chihuahua,
by the Company's partner, Minera Rio Tinto (MRT). These improvements
at the mill are expected to increase the daily production rate of ore through
the mill as well as the recovery of gold, silver and other metals from the
processing operations underway at the mill.

Both the ball mill and the new flotation cells are currently undergoing
commissioning and start-up and full operational integration with the existing
mill facilities should be achieved in the next few weeks. Once fully
commissioned, the Company expects that the production capacity of the mill
will be approximately 700 tonnes per day with an appropriate grind size to
achieve the maximum recovery rate of gold, silver and other metals consistent
with the mineralogy of the ore and the standards in the industry.

Earlier this year mill operations experienced intermittent issues with
availability owing to a lack of water and interruptions in electrical power
supply which have now been remedied. MRT and the Company determined that the
addition of a ball mill and related flotation cells would improve overall
mill availability and production as well as improve metal recoveries. The
ball mill has a nominal capacity of 750 tonnes per day, however due to the
overall softness of the Cieneguita gold ore, higher throughput may be
achieved from time to time. To match the flotation capacity with the
increased grinding/ball mill capacity, an additional bank of 10 Agitair cells
of 48 cubic foot size have been added to the previously installed bank of 10
WEMCO flotation cells (2 at 100 cubic foot capacity, 8 at 50 cubic foot

The Cieneguita mill makes a bulk sulfide flotation concentrate that is
sent to the MRT owned mill at Choix where it is then reground and separate
lead and zinc concentrates produced. These concentrates are then shipped to
the port at Manzanillo where they are sold under contract to the trading
company Trafigura. Most of the gold and silver report to the lead
concentrate. The anticipated increase in the production capacity at
Cieneguita will not require any modifications to the plant at Choix. Over the
last quarter (July-September) during the start-up phase of operations,
approximately 30,000 tonnes of material was mined from the pit and 2,000
tonnes of bulk concentrate shipped to Choix with the following average grades
as follows:

                              Au g/t  Ag g/t   Cu%     Pb%      Zn%
    Mined head from pit        1.20     90     0.04    0.35    0.65
    Bulk concentrate           15.0    900     0.40     3.5     4.0

Pan American currently has a joint venture agreement with MRT under which
MRT can earn 60% of the project by successfully initiating production on a
small scale, followed by the funding of an additional $4 million toward the
completion of a bankable feasibility study. With the completion of the
construction start-up phase at Cieneguita, the focus will now be the
acceleration of the feasibility study. This study will evaluate a full-scale
operation which will target a production rate of about 5,000 tonnes of
material processed per day along with saleable metal production directly from
the Cieneguita site.

The technical information in this release has been prepared by Gary A.
, CPG, a Director of the Company and a Qualified Person as defined by

About Pan American Goldfields/MexoroMinerals

Pan American Goldfields is a Chihuahua, Mexico based precious metal
producer and exploration company. It is a specialist in exploration, mine
development and production in Mexico's booming Sierra Madre Gold-Silver Belt.
The company's most advanced project is its now producing Cieneguita Gold Mine
where a feasibility study to significantly increase the mine's already
growing production profile is underway.

On behalf of the Board of Directors,

Mario Ayub, Chairman

Safe Harbor Disclosure,

For further information: Christopher R Anderson, Investor Relations,
+1-604-628-7065, +44(0)20-3-371-7844 - UK - London,

For further information: Christopher R Anderson, Investor Relations, +1-604-628-7065, +44(0)20-3-371-7844 - UK - London, info at

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