Xtierra Inc. Reports Initial Drill Results at Bilbao

TORONTO, ONTARIO -- (Marketwire - July 7, 2010) - Xtierra Inc. (TSX VENTURE: XAG) ("Xtierra" or the "Company"), is pleased to report that 9 holes totaling 2,132 metres comprising part of a previously announced 5,000 metre program at Bilbao have been completed. A second drill rig was recently mobilized to accelerate progress with the geotechnical and wider exploration portions of the program.

The Company is pleased to announce that mineralization has been encountered in the first two step-out holes (X-84 and X-85) to the south, extending the outer limits of the Bilbao deposit for at least an additional 50 metres. Both holes encountered higher grade zinc and lead values than for the deposit as a whole.

Hole X-84, collared 50m east of hole X-85 and 75m southeast of hole X-26, encountered a mineralized zone of 2.2m with a combined grade of over 11% zinc+lead together with 0.21% copper and 70.50g/t silver and hole X-85, collared 50m south of hole X-26, intersected a zone of 1.8m with >7% zinc+lead together with 0.65% copper and 53.65/t silver as well as a separate, upper zone, of brecciated limestone averaging 90.14g/t silver over a width of 20.0 metres.

This new silver intersection lies within 75 metres of the previously reported high grade native silver veinlets encountered in hole X-26 which averaged 1.3kg/t silver over 3 metres. High silver values were also recorded in three other holes previously collared in the southwestern part of the Bilbao deposit (X-34, X-35 and X-37), located 50m to 100m respectively northeast and north of hole X-26. As presently known, the area of high silver values occurs over a length of at least 150m by 75m in width, and is open ended to the south and west. It is believed that the high silver values may be related to a silver-rich, late-stage, pulse of hydrothermal mineralization.

Hole From (m) To (m) Width (m) Pb (%) Zn (%) Zn + Pb (%) Cu (%) Ag (g/t)
X-84 282.3 284.5 2.2 6.28 4.75 11.03 0.21 70.50
X-85 155.0 175.0 20.0 0.18 0.14 0.32 0.01 90.14
and 198.5 200.3 1.8 2.68 4.66 7.34 0.65 53.65

The relevant intersections from earlier drill-holes (previously released) are as follows:

Hole From (m) To (m) Width (m) Ag (g/t)
X34 311.0 313.0 2.0 711.0
X35 220.4 221.4 2.0 290.0
X37 138.0 139.0 1.0 383.0
and 320.0 322.0 2.0 330.0

Samples were prepared at the Stewart Group laboratory in Zacatecas and analyzed for multi-element content using ICP by Stewart Group in Kamloops, British Columbia. Standards and blanks were used regularly for quality control.

Approximately 40 holes will be completed in four component parts: (1) step-out drilling to the south and southwest of the existing silver-zinc-lead-copper deposit to define additional sulphide resources and to follow up previously intersected high silver vein mineralization; (2) in-fill drilling within the current resource to upgrade resource categorization and for geotechnical data; (3) condemnation drilling in the area of the proposed mine installations; and (4) initial exploration drilling at the Gaby Marina and Cata Negra prospects, both within 5km of Bilbao.


Comment

Commenting on the results, Terence McKillen, CEO of Xtierra, said, "It is very encouraging that the initial step-out holes confirm that the Bilbao mineralization extends to the south of the main body which remains open in that direction and suggests that there is excellent potential for further increasing the overall resource tonnage. The identification of a significant zone of silver mineralization adjacent to the previously encountered high grade silver veins opens up the possibility of locating a silver-rich, brecciated vein structure in the southwestern part of the Bilbao deposit." Mr. McKillen added, "The drilling forms part of the final component of a feasibility study which also includes pilot-scale metallurgical testing of the extraction process selected for the oxide ores."


Qualified Person

Information of a scientific or technical nature contained in this release has been prepared by or under the supervision of Terence N. McKillen, P.Geo., Chief Executive Officer and Dr. Anthony C. Gallon, C.Eng., Chief Geologist, both 'qualified persons' within the meaning of National Instrument 43-101 – Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators.


About Xtierra Inc.

Xtierra Inc. is a Toronto based exploration and development company listed on the TSX Venture Exchange. Xtierra's shares trade under the symbol "XAG". Xtierra has 75,637,003 shares issued and outstanding. Xtierra is conducting a feasibility study on its Bilbao silver‐zinc‐lead-copper project in Zacatecas, Mexico. Xtierra's objective is to become a mid‐tier producer of precious and base metals through the development of its Bilbao project as well as through exploration, organic growth and M & A opportunities.



Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or the accuracy of this release.



For more information, please contact

Xtierra Inc.
Terence McKillen
President & Chief Executive
+1 (416) 362-8243
or
Xtierra Inc.
Tim Gallagher
Director
+1 (416) 925-0090
or
Xtierra Inc.
Alejandro Alaniz
Director Finance & Administration (Mexico)
+52 (492) 925-0804
www.xtierra.ca