Jun 19, 2014
Scorpio Mining Announces Cosalá District Project Development
Toronto, June 19 , 2014 - Scorpio Mining Corporation (TSX: SPM) ("Scorpio Mining" or the "Company") today announced its development plans for the Cosalá District projects with NI 43-101 compliant resources, namely the El Cajón and San Rafael deposits, both located within trucking distance from its Nuestra Señora processing plant.
El Cajón Mine Development Update
Underground development work is proceeding as scheduled. As of the end of May, the portal had been secured; 167 m of ramp had been driven, along with 42 m of lateral cross-cut to establish the powder magazine. Pictures of the on-going work at El Cajón are regularly posted on the Company's website (El Cajón Development).
The field visit by the Dirección General de Minería ("DGM"), to provide surveying evidence of where the boundaries of the Company's concessions lie relative to those of a neighbour, has now been scheduled for June 25, 2014. Considering the time lapse since our request was issued, in late March, and the probable duration of the following cabinet work by the DGM, before issuing their final assessment, the publication of a prefeasibility study covering the El Cajón project may be postponed into Q1 2015. This is not affecting the underground development schedule though.
Prospective Cosalá Norte Project Development Sequence
With the ramp being driven into El Cajón and the subsequent production ramp-up expected to follow later this year, the Company is considering alternatives for bringing forward the development of the San Rafael Project as an additional source of ore. As indicated in the NI 43-101 technical report prepared for the San Rafael Project, (per Mine Development Associate's report dated September 7, 2012, filed on SEDAR) comprising both the Zn-Pb-Ag Main Zone and the Ag-Cu 120 Zone, both deposits hold a total of over 90 million silver equivalent ("Ag eq.") ounces1 in the Measured & Indicated ("M&I") resource categories. It is envisioned that the potential development of the San Rafael Project through production would be coupled with the finalization of the plant expansion, from a nameplate capacity of 1,600 tonnes per day ("tpd") to 2,750 tpd.
(Note 1. Conversion to silver equivalent (Ag eq.) ounces based on 2014 budget metal pricing of $19/oz Ag, $0.99/lb Pb, $0.95/lb Zn, $2.97/lb Cu, $1,294/oz Au).
Towards this goal, specific tasks are planned, such as:
Scorpio Mining Corporation is a silver producer operating in Mexico with significant base metal by-product credits. The 100% owned Nuestra Señora Mine located in the Cosalá District of the state of Sinaloa, has flexible mining methods and diversified metal production. It has a fully mechanized underground operation and a 1,600 tpd processing facility with permitted capacity for expansion to 4,000 tpd. The plant produces zinc, copper and lead concentrates, with a significant payable silver component in the copper and lead concentrates.
In addition, the Company has numerous exploration targets in the vicinity of its current operations as well as the advanced El Cajón and San Rafael development projects. The Company's strategy for near-term growth is currently focused on mine development of the fully-permitted El Cajón deposit.
Scorpio Mining's President and CEO, Mr. Pierre Lacombe, Eng. (OIQ, PEO), is a Qualified Person as defined under National Instrument 43-101 and has reviewed and approved the content of this release.
ON BEHALF OF SCORPIO MINING CORPORATION
Pierre Lacombe, Eng.
President & CEO
For further information contact:
Victoria Vargas, Vice President Investor Relations and Corporate Communications +1 416-585-2200
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 Company'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 Company'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 13, 2014. 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.