Jul 29, 2011
Scorpio Mining Announces Second Quarter Financial Results
Toronto, July 29, 2011- Scorpio Mining Corporation (TSX: SPM) ("Scorpio Mining" or the "Corporation") is pleased to announce its unaudited financial and operating results for the second quarter ("Q2") of 2011. This press release should be read in conjunction with the Corporation's Management Discussion & Analysis, Financial Statements and Notes to Financial Statements for the six month period ended June 30, 2011, available on the Corporation's website at www.scorpiomining.com and on SEDAR at www.sedar.com. All monetary figures are expressed in Canadian dollars unless otherwise specified.
Parviz Farsangi, President and CEO, reports: "We are very pleased to report another solid quarter of production and financial performance from Scorpio Mining's Nuestra Señora operations. A robust operating cash flow allowed the Corporation to eliminate its debt during the quarter, placing us in an ideal position to advance our stated growth initiatives, including process expansion and development of our existing assets."
Highlights for the Second Quarter Ended June 30, 2011
While comparisons to the second quarter of 2010 show large production increases, it should be noted that Q2 2010 suffered from a significant throughput reduction due to a ball mill failure.
(2) Silver; equivalent ounces in 2011 were established using budgeted prices as follows: lead US$1.02 per lb; zinc US$1.01 per lb; copper US$3.58 per lb and silver US$24 per oz.
As of October 31, 2010, the existing reserves at the Nuestra Señora mine provide the equivalent of six years of production at the current processing capacity of the Nuestra Señora plant. In the Cosalá district, the Corporation has NI 43-101 compliant mineral resources at the San Rafael and El Cajón projects, as well as having several advanced exploration projects. The Corporation is aggressively advancing its exploration activities to further increase mineral resources and prove additional reserves.
The Nuestra Señora processing plant has an existing capacity of approximately 1,500 tonnes per day ("TPD"), but is expandable up to approximately 4,000 TPD. The Corporation has commenced engineering studies to quantify the investment required for varying expansion scenarios. Other growth alternatives being evaluated include the development of a second processing facility in the Cosalá district. Such expansion would allow for the diversification of process circuits and reduce the distances between multiple ore sources and processing facilities.
The Corporation will advance feasibility studies for the expansion of processing capacity and make development decisions during 2011.
The Corporation continues to seek new projects that would increase its asset base as well as enhance value for its shareholders.
Scorpio Mining's President and CEO, Parviz Farsangi, MEng, MBA, PhD, PEng, is a Qualified Person for the Corporation's Mexico projects and has reviewed the content of this release.
ON BEHALF OF SCORPIO MINING CORPORATION
President & CEO
For further information contact:
Rich Kaiser, YES International: 1-800-631-8127; 001-757-306-6090 (outside North America)
This news release includes certain statements that may be deemed "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the Corporation's operations, exploration and development plans, expansion plans, estimates, expectations, forecasts, objectives, predictions and projections of the future. Generally, these forward-looking statements can be identified by the forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "projects", "intends", "anticipates", or "does not anticipate", or "believes", or "variations of such words and phrases or state that certain actions, events or results "may", "can", "could", "would", "might", or "will" be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Scorpio Mining Corporation to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the exploration and development and operation of the Corporation's projects in Mexico, risks related to international operations, construction delays and cost overruns, the actual results of current exploration, development and construction activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of silver, zinc, copper, lead and gold, risks relating to completing acquisition transactions as well as those factors discussed in the sections relating to risk factors of our business filed in Scorpio Mining Corporation's required securities filings on SEDAR, including its Annual Information Form dated March 29, 2011. Although Scorpio Mining Corporation has attempted to identify important factors that could cause results to differ materially from those contained in forward-looking statements, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended.
There can be no assurance that any forward-looking statements will prove accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Scorpio Mining Corporation does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.