VANCOUVER - Capstone Mining Corp. ('Capstone' or the 'Company') (TSX: CS) announces updated Proven and Probable Mineral Reserves and positive results of an updated Technical Report for its Cozamin Mine in Zacatecas, Mexico.
HIGHLIGHTS
Proven and Probable Mineral Reserves increased by 97% relative to December 31, 2019, to 10.2 million tonnes grading 1.79% copper.
Ramp-up to 1.35 million tonnes milled per annum ('tpa') by Q2 2021 is on time and budget. A new section of ramp to complete a one-way traffic circuit remains on schedule for completion in Q4 2020.
Updated life of mine plan ('LOMP') released. For the three years post-expansion (2021-2023) when compared to the three years pre-expansion (2018-2020), annual average copper and silver production increases by 70% to 61.4 million pounds and 43% to 1.75 million ounces, respectively. Additionally, average annual C1 costs (net of by-products) are expected to move 23% lower to $0.67 per payable pound of copper.
Tailings management transformation activities are progressing on schedule, including design and permitting of a filtered (dry stack) tailings storage facility. This strategy aligns with industry leading environmental best practice for tailings management.
A pre-feasibility study ('PFS') of an underground paste backfill system is underway to assess the potential for increasing the extraction ratio from Vein 20 in the Mala Noche Footwall Zone ('MNFWZ'). The updated LOMP currently excludes these pillars and assumes an extraction ratio of 74%, leaving 3.5 million tonnes of Indicated Mineral Resources grading 1.89% copper and 42 g/t silver in unmined pillars that will be the subject of the PFS. This pillar extraction PFS is targeted for completion in Q4 2020 and assuming positive economics, it will include updated capital and net present value estimates and changes to the LOMP presented herein.
A new step-out hole drill program totalling 80 holes targeting the down dip extension to the southeast of both Vein 10 and Vein 20 is underway. Hole S499 and S503 intersected high grade polymetallic copper, zinc, lead and silver in a 650-meter step-out from the current mineral resource. A 1 km exploration drift is being considered to provide a drilling platform to target this new area.
An updated Mineral Resource Estimate is expected to be released with the pillar extraction PFS results. Drilling on the outer edges of the current resource is ongoing and will include all new drill holes with assay data received since April 30, 2020.
Brad Mercer, Capstone's SVP Exploration and Operations said, 'We decided to take a two-phase approach and release the Mineral Reserves ahead of our 2021 budgeting cycle, allowing us to greenlight key projects by year-end. The second phase of this work, targeted for completion in Q4 2020, will focus on opportunities we have identified, such as the feasibility of high-grade pillar extraction using paste backfill, updating the block model with ongoing exploration results and ongoing metallurgical and geotechnical work on Vein 10 not in Reserve.'
Darren Pylot, Capstone's President and CEO said, 'I'm pleased to see Cozamin evolving into a safer and more productive mine with the one-way ramp in service and the potential for truckless headings as we look to add ore passes in our mine design. Additionally, it will be a more socio-environmentally responsible operation with the transition to dry-stack tailings and potentially a paste backfill plant that could return up to 60% of our tailings underground, so we can safely recover high grade pillars. This plan reinforces my view that Cozamin is a Tier 1 asset that will continue to generate exceptional value for all stakeholders.'
ABOUT CAPSTONE MINING CORP.
Capstone Mining Corp. is a Canadian base metals mining company, focused on copper. Our two producing mines are the Pinto Valley copper mine located in Arizona, US and the Cozamin copper-silver mine in Zacatecas State, Mexico. In addition, Capstone owns 70% of Santo Domingo, a large scale, fully-permitted, copper-iron-gold project in Region III, Chile, in partnership with Korea Resources Corporation, as well as a portfolio of exploration properties. Capstone's strategy is to focus on the optimization of operations and assets in politically stable, mining-friendly regions, centred in the Americas. We are committed to the responsible development of our assets and the environments in which we operate. Our headquarters are in Vancouver, Canada and we are listed on the Toronto Stock Exchange (TSX).
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This news release, and the documents incorporated by reference herein, contains 'forward-looking information' within the meaning of Canadian securities legislation and 'forward-looking statements' within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, 'forward-looking statements'). These forward-looking statements are made as of the date of this document and Capstone Mining Corp. ('Capstone' or the 'Company') does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation. Forward-looking statements relate to future events or future performance and reflect our expectations or beliefs regarding future events. Forward-looking statements include, but are not limited to, statements with respect to the continuing success of mineral exploration, Capstone's ability to fund future exploration activities, the estimation of mineral resources and mineral reserves, the expected success of the underground paste backfill system study, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production and capital expenditures, the success of our mining operations, the estimations for potential quantities and grade of inferred resources and exploration targets, environmental risks, unanticipated reclamation expenses and title disputes. In certain cases, forward-looking statements can be identified by the use of words such as 'plans', 'expects', 'aiming', 'approximately', 'guidance', 'scheduled', 'target', 'estimates', 'forecasts', 'extends', 'convert', 'potential', 'intends', 'anticipates', 'believes' or variations of such words and phrases, or statements that certain actions, events or results 'may', 'could', 'should', 'would', 'will', 'might' or 'will be taken', 'occur' or 'be achieved' or the negative of these terms or comparable terminology. By their very nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, amongst others, risks related to inherent hazards associated with mining operations and closure of mining projects, the inherent uncertainty of mineral exploration and estimations of exploration targets, potential delays in exploration due to COVID-19 or governmental action, increase to operating costs directly or indirectly related to due to COVID-19 including but not limited to supply chain issues, future prices of copper and other metals, compliance with financial covenants, surety bonding, our ability to raise capital or fund explorations, Capstone's ability to acquire properties for growth, counterparty risks associated with sales of our metals, foreign currency exchange rate fluctuations, changes in general economic conditions, accuracy of mineral resource and mineral reserve estimates, operating in foreign jurisdictions with risk of changes to governmental regulation, compliance with governmental regulations, compliance with environmental laws and regulations, reliance on approvals, licences and permits from governmental authorities, impact of climatic conditions on our operations, aboriginal title claims and rights to consultation and accommodation, land reclamation and mine closure obligations, uncertainties and risks related to the potential development of the Cozamin project, increased operating and capital costs, challenges to title to our mineral properties, maintaining ongoing social license to operate, dependence on key management personnel, potential conflicts of interest involving our directors and officers, corruption and bribery, limitations inherent in our insurance coverage, labour relations, increasing energy prices, competition in the mining industry, risks associated with joint venture partners, our ability to integrate new acquisitions into our operations, cybersecurity threats, legal proceedings, and other risks of the mining industry as well as those factors detailed from time to time in the Company's interim and annual financial statements and MD&A of those statements, all of which are filed and available for review under the Company's profile on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause our actual results, performance or achievements to differ materially from those described in our forward-looking statements, there may be other factors that cause our results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that our forward-looking statements will prove to be accurate, as our actual results, performance or achievements could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on our forward-looking statements.
Contact:
Jerrold Annett
Tel: 647-273-7351
Email: jannett@capstonemining.com
CAPSTONE MINING 
