Stillwater Mining Company Reports on Third Quarter Production

Stillwater Mining Company Reports on Third Quarter Production and
Commissioning of the Blitz Project Tunnel Boring Machine; Provides
Projects Update 
BILLINGS, MT -- (Marketwire) -- 10/03/12 --  Stillwater Mining
Company (NYSE: SWC) (TSX: SWC.U) today reported third quarter 2012
combined mine palladium and platinum production of 127,000 ounces,
year-to-date combined production of 381,200 ounces, and reiterated
its 2012 PGM mine production guidance of 500,000 ounces and its 2012
total cash cost guidance of $500 per ounce. (Total cash cost per
ounce is a non-GAAP measure of extraction efficiency that is further
defined in the Company's 2011 Annual Report on Form 10-K filed with
the U.S. Securities and Exchange Commission and available on the
Company's website, 
The Company also reported that its Blitz project tunnel-boring
machine (TBM) is now in place and operational, provided an update on
its development and exploration projects, reported on the initiation
of the startup phase for its slag cleaning furnace, and progress on
its precious metal refinery technology. 
2012 Production by Quarter  

(Mined Ounces)       First Quarter Second Quarter Third Quarter Year-To-Date
                     ------------- -------------- ------------- ------------
Stillwater Mine             87,700         98,100        94,100      279,900
Palladium                   67,600         75,300        72,000      214,900
Platinum                    20,100         22,800        22,100       65,000
East Boulder Mine           33,100         35,300        32,900      101,300
Palladium                   25,800         27,500        25,500       78,800
Platinum                     7,300          7,800         7,400       22,500
Company Total              120,800        133,400       127,000      381,200
Palladium                   93,400        102,800        97,500      293,700
Platinum                    27,400         30,600        29,500       8

The Company's recently acquired TBM, which is to be utilized in
developing the Company's new underground Blitz PGM project to the
east of the existing Stillwater Mine, is now operational. The TBM was
assembled over the past four months in an underground chamber
specifically excavated for that purpose. 
The Blitz project will be in development for approximately five more
years and involves three interdependent initiatives: a TBM drive
extending about 23,000 feet to the east from the existing Stillwater
Mine infrastructure; a second underground drift to be conventionally
driven parallel to and about 600 feet above the TBM drive; and a new
surface portal and decline to be located about four miles to the east
of the existing Stillwater Mine facilities. The new surface portal
will be conventionally driven from surface and ultimately will
intercept the two primary Blitz tunnels, providing ventilation and
emergency egress for the Blitz area.  
The Blitz project remains on track for completion in 2017. The TBM
drive, parallel drift, and surface portal and decline are designed to
provide the backbone for future mining in the Blitz project area and
will cost an estimated $180 million, of which approximately $33.4
million has been spent through September 2012. The Blitz project is
intended to strengthen the Company's ore reserve position by
establishing access to previously undeveloped portions of the J-M
Reef, thereby extending the available mining life there and creating
the potential for expanded mine production rates in the future. Ore
produced from the Blitz project would be processed at the Company's
adjacent Stillwater Mine mill, which has excess permitted capacity
Development at the Company's Graham Creek PGM project, where the
Company is using one of the original East Boulder Mine TBMs to
develop 8,200 feet to the west of the existing East Boulder
infrastructure, is progressing somewhat ahead of plan. Total Graham
Creek TBM development footage through September 2012 is about 5,700
feet, about 70% of the total 8,200 feet of new TBM development
planned there. The TBM development is slated to wrap up late in the
first quarter of 2013, after which two new vertical ventilation
raises (shafts) to surface will be added. Total cost of this Graham
Creek development work has been projected at around $8 million, of
which about $4.0 million has been spent through September 2012. In
view of the technical complexity of these ventilation raises, the
Company anticipates it may need to bring in an outside contractor for
the development of the raises, which could increase the total
estimated cost of the Graham Creek project by about $3 million. 
The Company could realize some early Graham Creek PGM production
during 2014, although the full development, including all
definitional drilling, is targeted for completion in early 2015. It
is not yet known if the project will facilitate any increase in
production rates at East Boulder, which like the Stillwater Mine also
has excess permitted mill capacity.  
Progress continues on several fronts at the Marathon PGM-copper
project situated near the northern shore of Lake Superior in the
province of Ontario, Canada. 
As previously announced, in April of 2012 Mitsubishi Corporation
became a 25% owner of the Marathon Project. Under the terms of the
agreement, Mitsubishi Corporation will bear 25% of future capital and
operating costs at Marathon and has acquired the right to purchase up
to 100 % of the PGM production from the Marathon project. Mitsubishi
Corporation may also facilitate access to Japanese project financing
resources in support of the mine development.  
A definitive engineering study is currently being conducted by
Nordmin Engineering Ltd, headquartered in Thunder Bay, Ontario. As
previously announced, an environmental impact statement (EIS) for the
Marathon project was submitted to a joint federal-provincial
environmental review panel on July 27, 2012. The definitive
engineering study will yield a final project design and firm cost
estimates for the project, as well as information required to obtain
the final Marathon operating permits. 
To this point the project team's principal effort has been focused on
reassessing work done previously in defining the economic resource
and ore reserves at Marathon, including updating that work for
information obtained subsequent to the prior study. Following this
reassessment, the team's efforts will focus on preparing the detailed
engineering and project design documents.  
Findings to date, while preliminary, indicate that the palladium
metal content was overestimated in a portion of the original resource
and reserve modeling work provided by a third-party expert at the
time of the acquisition. While it is still too early to assess the
overall effect or materiality of these findings on the project's
infrastructure, on its economics (as they apply to proven and
probable ore reserves), and on its permitting timeline, management
cautions that the effect is likely to be a deterioration in both
project economics and ore reserves. However, prelimina
ry findings to
date also suggest a potential increase in the overall resource
tonnage resulting from higher metals prices, better-than-estimated
metal recoveries and new drilling, although the Company must await
the full engineering study to confirm the effect of these findings.
The full Nordmin engineering study is currently slated for completion
during the first half of 2013.  
In the meantime, the Company continues to progress on schedule with
the environmental assessment and permitting processes, while updating
information as necessary to facilitate and complete the impact
analysis through the Joint Panel Review process. At present, the
project's EIS is under public review and open to public comment with
the Panel Hearings expected to begin sometime in the second quarter
of 2013. 
Management has reviewed the findings and the project team's
permitting and engineering progress to date. The Company is pleased
with the progress to date and, in anticipation of the start of
project development, is moving forward in assessing potential
financing alternatives. 
The Company owns and controls the Altar property, a large copper-gold
exploration play located in the Andes Mountains of the San Juan
province, Argentina. As reported in the Company's press release of
August 8, 2012, during the 2011-2012 drilling season on the Altar
property which concluded in late April the Company completed over
27,000 meters of additional core drilling (compared to 25,000 meters
originally budgeted), adding significantly to the understanding of
this emerging copper-gold resource.  
The season's drilling expanded the limits of the copper-gold
mineralization at depth in the original Altar discovery area and
confirmed the presence and significance of a second distinct
mineralizing center with somewhat higher gold grades in the eastern
portion of the Altar resource area. Further, reconnaissance drilling
has discovered a potential third distinct mineralizing center
indicating additional copper-gold potential on the Company's
concessions north of the current Altar resource. Drilling has yet to
define the perimeter of the Altar mineralization area. Added drilling
at Quebrada de la Mina, a gold target to the northwest of the
principal Altar mineral resource, indicated attractive gold grades
but insufficient volumes to sustain a stand-alone gold operation
While Altar exploration expenditures were budgeted at about $25
million for 2012, only about $17 million in total has been spent to
date through September, suggesting that even with fourth quarter 2012
spending to mobilize next year's drilling program, total spending at
Altar will probably not exceed $20 million this year. Political
developments in Argentina may further reduce spending at Altar in
2013. Drilling in the 2012-2013 season will focus on better defining
the resource at depth, as well as attempting to identify the eastern
perimeter of the mineralization. 
The Company's previous smelting furnace was idled when a new and
larger primary furnace was commissioned in 2009. In 2011, the idled
furnace was reconfigured as planned to serve as a slag-cleaning
furnace supporting improved metal recoveries and additional recycling
growth, as well as providing backup smelting capacity. 
Engineering of the operating systems necessary to connect the
modified furnace with the Company's primary smelting furnace has now
been completed and final construction is in progress. A mandatory
furnace warming required in starting the slag cleaning furnace
operation is underway this week. The furnace warming, to be followed
by firing up and conditioning of the reconfigured furnace, is
scheduled so that all construction will be complete and the newly
structured slag cleaning operation will be functional at the
beginning of December 2012. By the end of the year both furnaces
should be operating in tandem to increase PGM recoveries. 
It is projected that the slag cleaning operation will yield in excess
of 2,500 ounces of PGMs annually from both mined and recycled
materials that would otherwise remain bound up in the smelter slags. 
Separately, work on the precious metal refinery technology continues
with additional process test work scheduled during the fourth quarter
of 2012. 
The contents of this press release have been read and approved by
Stanford T. Foy, CPG, who is a Qualified Person under Canadian
Securities Administrators guidelines. 
About Stillwater Mining Company 
Stillwater Mining Company is the only U.S. producer of palladium and
platinum and is the largest primary producer of platinum group metals
outside of South Africa and the Russian Federation. The Company's
shares are traded on the New York Stock Exchange under the symbol SWC
and on the Toronto Stock Exchange under the symbol SWC.U. Information
on Stillwater Mining can be found at its website: 
Some statements contained in this news release are forward-looking
statements within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, and, therefore, involve uncertainties or risks that
could cause actual results to differ materially. These statements may
contain words such as "desires," "believes," "anticipates," "plans,"
"expects," "intends," "estimates" or similar expressions. These
statements are not guarantees of the Company's future performance and
are subject to risks, uncertainties and other important factors that
could cause its actual performance or achievements to differ
materially from those expressed or implied by these forward-looking
statements. Additional information regarding factors that could cause
results to differ materially from management's expectations is found
in the section entitled "Risk Factors" in the Company's 2011 Annual
Report on Form 10-K, in its quarterly Form 10-Q filings, and in
corresponding filings with Canadian securities regulatory
authorities. The Company intends that the forward-looking statements
contained herein be subject to the above-mentioned statutory safe
harbors. Investors are cautioned not to rely on forward-looking
statements. The Company disclaims any obligation to update
forward-looking statements. 
Mike Beckstead
(406) 373-8971 
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