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Fortuna beats guidance, reports record production of 5.2 million silver equivalent ounces for 2012 and issues production

   Fortuna beats guidance, reports record production of 5.2 million silver
      equivalent ounces for 2012 and issues production guidance for 2013

PR Newswire

VANCOUVER, Jan. 14, 2013

VANCOUVER, Jan. 14, 2013 /PRNewswire/ - Fortuna Silver Mines, Inc. (NYSE: FSM)
(TSX: FVI) (BVL: FVI)  (Frankfurt: F4S.F) is pleased  to announce 2012  record 
silver and gold production  figures from its San  Jose mine located in  Mexico 
and Caylloma mine located in Peru.

The company's  mining operations  performed strongly  in 2012  delivering  our 
sixth consecutive year of silver and gold production growth and sustained  low 
cash cost per  silver ounce.  For 2013, Fortuna  is scheduled  to produce  4.4 
million ounces of silver and 23,300 ounces of gold or 5.7 million Ag Eq ounces
plus significant base metal credits.

Jorge A. Ganoza, President and CEO,  commented: "2012 has been our sixth  year 
of continued record silver and gold production growth highlighted by the first
year anniversary of successful  commercial operations at  our San Jose  mine. 
For 2013, we continue to project sustained low cost silver and gold production
expansion driven by the San Jose ramp-up to be commissioned in early Q3  2013. 
Fortuna´s strategic objective  is to target  an annual production  rate of  14 
million silver and gold equivalent ounces by 2016 while maintaining cash costs
at its operations below industry average."

2012 Consolidated Production Highlights

  *Silver and gold production was 8% and 19% above 2012 production guidance
    respectively
  *Silver production of 4.0 million ounces; 59% increase over 2011
  *Gold production of 20,699 ounces; 195% increase over 2011
  *Estimated consolidated cash cost per ounce of silver, net of by-product
    credits, is US$ 6.38 (*)

(*) The final calculation of operating costs has not yet been completed
and the amounts are approximations.

2012 Consolidated Operating Highlights

                        Q4 2012                           2012
            Caylloma, San                   Caylloma, San Jose,
             Peru      Jose,    Consolidated Peru      Mexico     Consolidated
                       Mexico
Processed                                                                   
Ore
Tonnes         115,522   98,348      213,870   462,222    369,022      831,244
milled
Average tpd      1,256    1,107                 1,266      1,055            
milled
Silver                                                                      
Grade (g/t)        176      177                   177        188            
Recovery (%)     79.45    88.01                 77.32      87.52            
Production     519,549  491,181    1,010,730 2,038,579  1,949,178    3,987,757
(oz)

                          Q4 2012                          2012
               Caylloma, San                  Caylloma,  San
                Peru      Jose,   Consolidated Peru       Jose,   Consolidated
                          Mexico                          Mexico
Gold                                                                        
Grade (g/t)          0.34    1.39                   0.40    1.74            
Recovery (%)        40.46   87.85                  47.02   86.79            
Production (oz)       514   3,854        4,368      2,781  17,918       20,699
Lead                                                                        
Grade (%)            2.16                          1.99                  
Recovery (%)        89.51                         88.25                   
Production      4,935,599                    17,886,403                   
(lbs)
Zinc                                                                        
Grade (%)            2.78                          2.56                   
Recovery (%)        86.51                         85.77                   
Production      6,135,302                    22,395,791                   
(lbs)

The company is pleased to inform that the new tailings facility at Caylloma is
now fully permitted and operational.

2013 Guidance
 
 Mine             Silver Gold   CAPEX          Cash Cost (*)
                   (M oz) (k oz) (US$ millions) (US$/t)
 San Jose, Mexico 2.4    20.6   22.0           70.4
 Caylloma, Peru   2.0    2.7    30.7           96.0
 Total:           4.4    23.3   52.7           --

  *2013 forecast silver equivalent production of 5.7 million ounces using Ag
    = US$30/oz and Au = US$1,700/oz
  *Cash cost/oz Ag consolidated annual forecast, net of by-product credits,
    is US$5.01
  *Caylloma mine 2013 forecast for zinc and lead production of 25.1 million
    pounds and 19.4 million pounds respectively

(*)  Cash  cost  per  tonne  includes  all  on-site  direct  and  indirect 
production costs, community relations expenses, concentrate transportation and
corporate management  fees.  It  excludes  government  royalties  and  workers 
participation.

2013 Cash Cost Per Tonne Quarterly Guidance
                     
  Mine       Q1      Q2      Q3      Q4
            (US$/t) (US$/t) (US$/t) (US$/t)
  San Jose   76      78      67      65
  Caylloma   96      97      95      95
                                  

2013 Outlook

San Jose Mine

San Jose plans to process 451,000 tonnes of ore at 186 g/t Ag and 1.60 g/t Au.
Capital expenditures for 2013  are estimated to be  US$22.0 million. The  mill 
expansion from  1,000 to  1,500 tpd  is on  track to  be commissioned  at  the 
beginning of third quarter.

Major capital items include:

  *Mine development: US$5.7 million
  *Plant expansion: US$9.1 million
  *Tailings dam expansion: US$4.4 million

Caylloma Mine

Caylloma plans to process 464,100 tonnes of ore at 170 g/t Ag and 0.40 g/t Au.
Capital expenditures for 2013 are estimated to be US$30.7 million.

Major capital items include:

  *Mine development: US$7.6 million
  *Camp infrastructure: US$8.6 million
  *Tailings dam expansion: US$3.6 million
  *Power grid: US$4.8 million

The company´s brownfields exploration budget for 2013 is estimated at  US$14.2 
million; US$7.5  million will  be spent  at  San Jose  and US$6.7  million  at 
Caylloma. A comprehensive update of  the 2012 brownfields exploration  program 
is scheduled to be released in the upcoming weeks.

Qualified Person

Edgard Vilela  is an  independent Qualified  Person for  Fortuna Silver  Mines 
Inc., as  defined  by  National  Instrument 43-101,  and  is  responsible  for 
ensuring that the information  contained in this news  release is an  accurate 
summary of the original reports and  data provided to or developed by  Fortuna 
Silver Mines.

Fortuna Silver Mines Inc.

Fortuna is a growth oriented, silver and base metal producer focused on mining
opportunities in Latin America.  Our primary assets  are the Caylloma  silver 
mine in Arequipa, Peru and the  San Jose silver-gold mine in Oaxaca,  Mexico. 
The company  is  selectively  pursuing  additional  acquisition  opportunities 
throughout the Americas. For  more information, please  visit our website  at 
www.fortunasilver.com.

ON BEHALF OF THE BOARD

Jorge A. Ganoza
President, CEO and Director
Fortuna Silver Mines Inc.

Trading symbols: NYSE: FSM | TSX: FVI | BVL: FVI | Frankfurt: F4S.F

                          Forward-Looking Statements

This  news  release  contains  forward-looking  statements  which   constitute 
"forward-looking  information"  within  the  meaning  of  applicable  Canadian 
securities legislation and "forward-looking statements" within the meaning  of 
the "safe harbor" provisions of  the Private Securities Litigation Reform  Act 
of 1995. Forward-looking  statements are statements  that are not  historical 
facts and that are subject to a variety of risks and uncertainties which could
cause actual events or  results to differ materially  from those reflected  in 
the forward-looking statements. When used in this document, the words such as
"anticipates",  "believes",  "plans",  "estimates",  "expects",   "forecasts", 
"targets",  "intends",   "advance",  "projects",   "calculates"  and   similar 
expressions are forward-looking statements.

The forward-looking  statements  are  based  on an  assumed  set  of  economic 
conditions and courses  of actions, including  estimates of future  production 
levels, expectations  regarding mine  production  costs, expected  trends  in 
mineral prices and statements that describe Fortuna's future plans, objectives
or goals. There is a significant  risk that actual results will vary,  perhaps 
materially, from results  projected depending  on such factors  as changes  in 
general economic  conditions  and financial  markets,  changes in  prices  for 
silver and other metals, technological  and operational hazards in  Fortuna's 
mining  and   mine  development   activities,  risks   inherent  in   mineral 
exploration, uncertainties  inherent in  the estimation  of mineral  reserves, 
mineral resources,  and  metal  recoveries, the  timing  and  availability  of 
financing, governmental and other  approvals, political unrest or  instability 
in countries where Fortuna is active, labor relations and other risk factors.

Although Fortuna has attempted to identify important factors that could  cause 
actual results to  differ materially from  those contained in  forward-looking 
statements or information, 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  or 
information will prove  to be  accurate as  actual results  and future  events 
could  differ  materially  from  those  anticipated  in  such  statements   or 
information.  Accordingly,  readers  should   not  place  undue  reliance   on 
forward-looking statements or information.

SOURCE Fortuna Silver Mines Inc.

Contact:

Investor Relations:
Management Head Office:Carlos Baca- T (Lima): +51.1.616.6060, ext. 0
Corporate Office:Holly Hendershot- T (Toronto): +1.647.725.0813 / T
(Vancouver): +1.604.484.4085

Media contact for North America:

Breakstone Group
Christina Pagano
Telephone: +1.212.213.2851
Mobile: +1.646.382.3871
E-mail:paganopr@aol.com
 
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