Yamana Gold's Tender Offer for Meridian Gold Successfully Accepted by Shareholders; Yamana and Meridian Provide Combined Third Quarter Operational Highlights

Market Wire, October, 2007

YAMANA GOLD INC. (TSX: YRI)(NYSE: AUY)(LSE: YAU) and MERIDIAN GOLD INC. (TSX: MNG)(NYSE: MDG) today announced that as of the tender deadline on October 12, 2007, 79,873,250 common shares of Meridian Gold had been validly deposited to Yamana's offer to acquire all of the outstanding shares of Meridian. Yamana has taken up and accepted for payment all of these shares, which represent approximately 78 percent of the common shares of Meridian on a fully diluted basis. Yamana will pay for these shares promptly.

Yamana offered to acquire all of the outstanding common shares of Meridian on the basis of C$7.00 cash plus 2.235 Yamana common shares for each Meridian share. The aggregate cash consideration to be paid by Yamana will be approximately C$559 million and the aggregate number of common shares to be issued by Yamana will be approximately 179 million, in respect of the shares tendered to date.

Yamana has surpassed the minimum purchase condition of its offer and has extended its offer to midnight (EST) on November 2, 2007 to allow the remaining Meridian shareholders additional time to tender to the offer. For U.S. securities law purposes, this extension constitutes a subsequent offering period. A notice of extension and subsequent offering period will be mailed to Meridian shareholders on October 16, 2007.

All of the conditions to Yamana's agreement with Northern Orion have now been satisfied or waived, and Yamana's plan of arrangement with Northern Orion was completed and became effective on October 13, 2007. Northern Orion shareholders will shortly receive 0.543 of a Yamana common share and C$0.001 in cash for each Northern Orion share.

A formal process of acquisition of the balance of any outstanding Meridian shares will occur as is customary in similar transactions either by compulsory acquisition or subsequent acquisition transaction which would be intended to be completed before year end.

THIRD QUARTER OPERATIONAL HIGHLIGHTS

Yamana and Meridian provide the following operational update on a combined basis for the third quarter of 2007. Total production on a proforma combined basis during the third quarter was approximately 209,700 ounces of gold, 33.5 million pounds of copper, 2.2 million ounces of silver and 801 tonnes of zinc. Additional copper and gold production is also contributed by the interest in Alumbrera.

The following is a breakdown of operations by geography:

Brazilian, Argentine & Honduran Operations & Development (Yamana)

Consolidated gold production during the third quarter was approximately 131,400 ounces, representing record gold production for the Company from its Brazilian and Honduran mines. As previously announced, Yamana remains on track to produce approximately 300,000 ounces of gold for the second half of the year. The Company will assess and update its production expectations from time to time as it continues to gain production experience from its mines recently placed into production.

Gold production was more than 49,700 ounces from Chapada and approximately 27,300 ounces from Sao Francisco with the balance from Yamana's other operations including approximately 36,600 ounces of gold combined from San Andres and Fazenda Brasileiro and approximately 17,300 ounces from Jacobina. Copper production for the third quarter totaled approximately 33.5 million pounds.

At Chapada, a total of 54,628 tonnes of concentrate was produced and 55,773 tonnes of concentrate were delivered for sale during the quarter. Concentrate production is expected to increase further and cash costs are expected to decline at Chapada as operations ramp up to full capacity in the fourth quarter.

The Company continued to gain mining experience and a better understanding of the deposit at Sao Francisco. The mining and processing of more marginal or dump leach ore continued at Sao Francisco during the third quarter in keeping with the mine plan. Lower grade material and material initially believed to be waste is continuing to show higher grades than originally anticipated. This also has the effect of maintaining the proven and probable reserves of the higher grade material at Sao Francisco. During the third quarter, Yamana began to implement measures to reduce costs as planned for the second half of the year.

Production at Jacobina continued to ramp up during the third quarter following implementation of additional safety protocols and recommendations of rock mechanics advisers after certain sill pillar failures in historically mined areas which occurred earlier this year. Production is expected to increase in the fourth quarter as previously announced. Engineering and construction is underway and on track to increase the throughput capacity to 6,500 tonnes per day during the first quarter of 2008 and to 8,500 tonnes per day by the end of 2008. Current forecast production for 2008 is 140,000 to 150,000 ounces with production of 200,000 ounces targeted for 2009. It is expected that production at Jacobina will be sustained at a rate of over 200,000 ounces per year after 2009 and, while this is largely dependant on upgrading the large indicated and inferred resources to reserves over the coming years, the resource base is considered sufficient for sustained production at this level from 2009 onward. As part of the expansion strategy and upgrading of resources to reserves, underground mine development activities continued to progress at Canavieiras and at Morro do Vento Extension where most of the resource upgrade is expected.