McEwen Mining Provides Fourth Quarter & Full Year 2012 Operational and Development Update

McEwen Mining Provides Fourth Quarter & Full Year 2012 Operational and 
Development Update 
TORONTO, ONTARIO -- (Marketwire) -- 03/11/13 --  
(All Amounts in US Dollars Unless Otherwise Stated)  
McEwen Mining Inc. (NYSE:MUX)(TSX:MUX) is pleased to provide a
summary for its fourth quarter and full year operating results,
including 2013 production and cost guidance, for its mines and
projects in Argentina, Mexico and Nevada.  
HIGHLIGHTS 


 
--  Gold equivalent production in the fourth quarter totaled 32,220 ounces
    (17,578 gold ounces and 761,377 silver ounces). Full year production
    totaled 105,050 gold equivalent ounces (48,876 gold ounces and 2,921,242
    silver ounces), meeting 2012 guidance.  
    
--  Cash costs totaled $728 per gold equivalent ounce in the fourth quarter.
    Full year cash costs totaled $739 per gold equivalent ounce, below 2012
    guidance of $750 per gold equivalent ounce.  
    
--  The Company ended the year with $79 million in cash and liquid assets
    and no debt. 
    
--  Estimated 2013 production is expected to grow by 24% to 130,000 gold
    equivalent ounces (72,310 gold ounces and 3,000,000 silver ounces) at a
    cash cost between $800 - $900 per gold equivalent ounce. All-in
    sustaining costs are estimated at $1,200 - $1,325 per gold equivalent
    ounce. All-in sustaining costs include operational, development,
    exploration, royalties and reclamation costs. 
    
--  On January 1, 2013, El Gallo Phase 1 in Mexico achieved commercial
    production. The mine is currently operating at full capacity.  
    
--  El Gallo Phase 2 remains on schedule for construction and will become
    the Company's third and largest mine.  
    
--  Four new resource updates are due by the end of the second quarter,
    building on the Company's large resource base. 

 
"Last year was significant for McEwen Mining. We successfully merged
US Gold and Minera Andes, achieved record production at our San Jose
mine, completed construction and commissioned El Gallo Phase 1,
published a feasibility study for El Gallo Phase 2, and resolved the
litigation surrounding the Los Azules Copper project. This year will
also be an important year for the Company. First, we expect to see
production grow by 24% to 130,000 gold eq
uivalent ounces, and second,
financing and construction of our third mine, El Gallo Phase 2, is
scheduled to commence during the third quarter," stated Rob McEwen,
Chairman and Chief Owner.  
Balance Sheet 
At the end of the fourth quarter, McEwen Mining had cash and liquid
assets of $79 million, comprised of cash of $71 million and gold and
silver (produced and purchased) with a market value of $8 million.
Our cash balance reflects the completion of our rights offering in
December 2012, for total proceeds of $60.4 million. The Company
remains debt free. 
During the quarter, the Company received a dividend of $5 million
from its 49% owned San Jose mine in Argentina. Proceeds from the
dividend remained in Argentina to help fund exploration at the Los
Azules Copper project. The Company expects to receive dividends from
San Jose in 2013. Although the amounts and timing are beyond McEwen
Mining's control, it is anticipated that dividends in the first and
second quarter will be less than the fourth quarter, 2012. This is
due to retirement of local credit lines, income taxes payable,
equipment purchases related to the mine's 10% expansion, and the
temporary shutdown experienced in February due to worker illnesses.
Any dividends received during the first half of the year would be
spent locally at Los Azules. Dividends are expected to be higher
during the second half of 2013. The Company anticipates using these
dividends to help offset construction costs in Mexico, associated
with El Gallo Phase 2.  
El Gallo Phase 1 generated $2.1 million in operating cash flows,
after incurring costs associated with removal of overburden to access
future mineralization, during the fourth quarter. During the quarter,
the mine was focused on increasing throughput levels towards its
designed rate. The mine is now operating at full capacity.  
Major expenditures during the quarter included $13.1 million for
exploration at Los Azules, $3.8 million for exploration at the
Company's other projects, and $0.7 million related to El Gallo Phase
2. 
San Jose Mine, Argentina (49%) 
Solid Year of Production 
Final production results for McEwen Mining's share in the San Jose
mine during the fourth quarter, was 11,024 gold ounces and 757,009
silver ounces, representing 25,582 gold equivalent ounces (converting
the silver into gold using a 52:1 exchange ratio).  
For the full year, San Jose met its production guidance, with McEwen
Mining's share totaling 42,026 gold ounces and 2,916,742 silver
ounces or 98,117 gold equivalent ounces. In 2013, McEwen Mining's
share of production has been forecasted at 102,700 gold equivalent
ounces (45,000 gold ounces and 3,000,000 silver ounces). Production
is expected to increase in 2013 as an optimization plan was completed
that will increase processing capacity by +10% from 1,500 tonnes to
1,650 tonnes per day. 
For the quarter, cash costs equaled $728 per gold equivalent ounce.
Cash costs were flat versus the third quarter and less than the first
half of the year, as the team at San Jose has done an excellent job
dealing with industry-wide cost escalation. For the full year, cash
costs were below guidance of $750 per gold equivalent ounce at $739.
Cash costs and all-in sustaining costs per equivalent gold ounce for
2013 have been estimated at $725 - $825 and $1,150 - $1,275,
respectively.  
An updated reserve and resource estimate for the mine will be
released in the coming weeks. The updated resource will include
approximately 98,000 meters of additional core drilling.  


 
                     San Jose Mine Production Comparison                    
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                               Full-Year  Full-Year  4th Quarter 3rd Quarter
     San Jose - 100%(i)             2012        2011        2012        2012
----------------------------------------------------------------------------
Ore production (tonnes)          509,851     462,825     128,940     136,577
----------------------------------------------------------------------------
Average grade gold (gpt)            5.79        5.86        6.00        5.24
----------------------------------------------------------------------------
Average head silver (gpt)            417         444         422         402
----------------------------------------------------------------------------
Average gold recovery (%)           90.4        92.9        90.4        91.1
----------------------------------------------------------------------------
Average silver recovery (%)         87.0        88.8        88.3        87.9
----------------------------------------------------------------------------
Gold produced (ounces)            85,786      80,948      22,498      20,967
----------------------------------------------------------------------------
Silver produced (ounces)       5,952,534   5,869,564   1,544,917   1,552,000
----------------------------------------------------------------------------
Gold equivalent(1) produced                                                 
 (ounces)                        200,240
     193,824      52,208      50,813
----------------------------------------------------------------------------
Gold sold (ounces)                84,292      82,420      23,161      29,126
----------------------------------------------------------------------------
Silver sold (ounces)           5,897,099   6,087,525   1,553,077   2,165,000
----------------------------------------------------------------------------
Co-product total cash cost                                                  
 Au (US$)                            760         628         770         766
----------------------------------------------------------------------------
Co-product total cash cost                                                  
 Ag (US$)                          13.90       13.63       13.35       14.66
----------------------------------------------------------------------------
Gold equivalent total cash                                                  
 cost (US$)                          739         675         728         764
----------------------------------------------------------------------------
Co-product all-in sustaining                                                
 cash cost Au (US$)                1,208         962       1,228       1,126
----------------------------------------------------------------------------
Co-product all-in sustaining                                                
 cash cost Ag (US$)                22.11       20.89       21.29       21.54
----------------------------------------------------------------------------
Gold equivalent co-product                                                  
 all-in sustaining cash cost                                                
 (US$)                             1,174       1,035       1,160       1,122
----------------------------------------------------------------------------
  McEwen Mining - 49% Share                                                 
----------------------------------------------------------------------------
Gold produced (ounces)            42,026      39,665      11,024      10,274
----------------------------------------------------------------------------
Silver produced (ounces)       2,916,742   2,876,086     757,009     760,480
----------------------------------------------------------------------------
Gold equivalent(1) produced                                                 
 (ounces)                         98,117      94,974      25,582      24,898
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(i)McEwen Mining holds a 49% attributable interest in the San Jose mine.    

 
El Gallo Phase 1, Mexico (100%)  
Commercial Production Achieved. Running at Steady State. 
The focus at El Gallo Phase 1 during the fourth quarter was on
increasing production levels towards the designed rate of 3,000
tonnes per day. This was successfully achieved, with commercial
production being declared on January 1, 2013. During the fourth
quarter the mine produced 6,554 gold ounces and 4,500 silver ounces
or 6,638 gold equivalent ounces. Since declaring commercial
production the crushers have been operating 20% above the designed
throughput rate. 
The Company will begin reporting cash costs and all-in sustaining
costs starting in the first quarter, 2013. Cash costs and all-in
sustaining costs per gold equivalent ounce for 2013 have been
estimated at $1,135 - $1,235 and $1,200 - $1,325, respectfully. Costs
are estimated to be higher in 2013 versus the life of mine plan, due
to higher pre-stripping required to access deeper mineralization and
lower grades, early in the mine life. 
A new resource estimate for Phase 1 will be released during the
second quarter. This will include approximately 11,600 meters of new
core drilling. 
El Gallo Phase 2, Mexico (100%) 
Next Mine Remains on Target for Construction 
The Company remains on schedule to submit its construction and mining
permits by the end of the first quarter to SEMARNAT, Mexico's
Environmental and Natural Resource Ministry. Although the approval
and its timing are outside of McEwen Mining's control, the Company is
targeting the end of the third quarter for approval. 
Long lead-time equipment purchases have commenced. Both the ball mill
and filter presses for the dry stack tailings having been ordered.
The ball mill and filter presses are expected to be shipped to El
Gallo in approximately 32 weeks. The Company expects to purchase the
crushers, leach tanks, agitators, electrical substation and the
Merrill Crowe plant during the second and third quarters.  
Capital expenditures to complete El Gallo Phase 2 have been estimated
between $180-$190 million. In order to complete construction the
Company will need to raise an estimated $120 million. McEwen Mining
is looking at several financing alternatives, which include a
possible sale or joint venture of its Los Azules Copper project and
various forms of debt and equity.  
A new resource estimate for Phase 2 will be released during the
second quarter. This will include approximately 10,000 meters of new
core drilling. 
Nevada (100%) 
1) Gold Bar Project 
McEwen Mining continues to advance the Gold Bar permitting process in
order to begin production in 2015. Gold Bar is forecasted to produce
55,000 gold ounces per year. The project is located primarily on
public lands managed by the Bureau of Land Management (BLM). The BLM
and the Nevada Division of Environmental Protection (NDEP) are the
primary government agencies responsible for approving the permits
that would allow the Company to begin construction.  
McEwen Mining will continue to advance the Gold Bar project through
the permitting process during 2013. This will involve additional
environmental baseline collection and data review. The Company
expects to submit its Plan of Operations report in the second half of
2013.  
2) Tonkin Project 
The Tonkin project, which has a current resource of 1.4 million gold
ounces in the measured and indicated categories (32.3 million tonnes
@ 1.39 gpt gold) and 0.3 million gold ounces in the inferred (8.4
million tonnes @ 1.13 gpt gold), is undergoing a series of
metallurgical tests for possible process alternatives that are common
to mines in Nevada. The last test results indicated that
approximately 50-55% of the gold would report to a concentrate, which
would then be subsequently processed by an autoclave or roaster.
McEwen Mining feels the amount of gold reporting to the concentrate
needs to be higher in order to make Tonkin economically viable.  
The Company believes the percentage of gold reporting to the
concentrate is low because the mineralization is oxidizing too
quickly. In order to determine why this is occurring, a detailed
study is being conducted on the mineralogy. If the cause can be
determined, the Company plans to explore alternatives that would slow
the oxidizing process. The results from the mineralogy study are due
in the second quarter.  
Los Azules Copper Project, Argentina (100%) 
World Class Copper Asset - Size & Grade  
Los Azules is one of the world's largest and highest grade
undeveloped copper porphyry deposits. This year's exploration
program, with a budget of $25 million, is scheduled to be completed
by the end of the first quarter. New drill results and subsequent
resource update have proven that there remains excellent potential to
further grow this world-class copper asset. Significant drill results
released in January 2013, included 0.47% copper over 610 meters,
0.61% copper over 160 meters, 0.44% over 529 meters. Based on the
results of these holes, the inferred resource grew by 29%. Los Azules
resource now contains 4.45 billion lbs in the indicated category and
13.95 billion lbs in the inferred category (Indicated: 310 million
tonnes @ 0.65% copper; Inferred: 1.3 billion tonnes @ 0.49% copper).  
Additional drill results from the Company's ongoing exploration
program are expected to be released in approximately three weeks. In
addition, McEwen Mining has begun work on an updated Preliminary
Economic Assessment (PEA), which is expected to be completed in the
third quarter of this year. The updated PEA will be based on a
significantly larger mineral resource and will also evaluate the
possibility of increasing the daily thr
oughput. The PEA will also
incorporate further metallurgical studies currently being done on the
possibility of producing copper cathode instead of a concentrate, and
processing low grade mineralized material not previously considered,
via a heap leach. The advantage of being able to produce a copper
cathode is that it would eliminate the contemplated slurry pipeline
through Chile and would reduce Argentina's export tax on concentrate. 
Santa Cruz Exploration, Argentina (100%) 
During the fourth quarter, the Company completed approximately 1,554
meters of reverse circulation drilling on its 100% owned claim
package adjacent to the San Jose mine and Goldcorp's Cerro Negro
project. A further approximate 1,000 meters were drilled in the first
quarter of 2013. The assays from this drilling did not return any
economic quantities of gold or silver. No further drilling is
currently planned. 


 
Fourth Quarter Conference Call Details                                      
                                                                            
McEwen Mining will be hosting a conference call to discuss fourth quarter   
results and project developments on                                         
March 11, 2013 at 2:00 pm EST.                                              
                                                                            
WEBCAST:                                                                    
http://www.gowebcasting.com/4215                                            
                                                                            
TELEPHONE:                                                                  
Participant dial-in number(s): 416-695-7848 / 800-769-8320                  
Participant pass code: None Required                                        
                                                                            
REPLAY:                                                                     
Dial-in number(s): 905-694-9451 / 800-408-3053                              
Pass code: 8222665                                                          

 
ABOUT MCEWEN MINING (www.mcewenmining.com)  
The goal of McEwen Mining is to qualify for inclusion in the S&P 500
by 2015 by creating a high growth gold producer focused in the
Americas. McEwen Mining's principal assets consist of the San Jose
mine in Santa Cruz, Argentina (49% interest); the El Gallo complex in
Sinaloa, Mexico; the Gold Bar project in Nevada, US; the Los Azules
project in San Juan, Argentina and a large portfolio of exploration
properties in Argentina, Mexico and Nevada. 
McEwen Mining has 296,024,859 shares issued and outstanding. Rob
McEwen, Chairman, President and Chief Owner, owns 25% of the shares
of the Company (assuming all outstanding Exchangeable Shares are
exchanged for an equivalent amount of Common Shares). As of December
31, 2012, McEwen Mining had cash and liquid assets of approximately
US$79 million and is debt free. 
RELIABILITY OF INFORMATION 
Minera Santa Cruz S.A., the owner of the San Jose mine, is
responsible for and has supplied to the Company all reported results
from the San Jose mine. McEwen Mining's joint venture partner, a
subsidiary of Hochschild Mining plc, and its affiliates other than
MSC do not accept responsibility for the use of project data or the
adequacy or accuracy of this release. As the Company is not the
operator of the San Jose mine, there can be no assurance that
production information reported to the Company by MSC is accurate,
the Company has not independently verified such information and
readers are therefore cautioned regarding the extent to which they
should rely upon such information. 
TECHNICAL INFORMATION 
This news release has been reviewed and approved by William Faust,
PE, McEwen Mining's Chief Operating Officer, who is a Qualified
Person as defined by National Instrument 43-101 ("NI 43-101). For
additional information about the El Gallo complex see the technical
report titled "El Gallo Complex Phase II project, NI 43-101 Technical
Report Feasibility Study, Mocorito Municipality, Sinaloa, Mexico"
with an effective date of September 10, 2012, prepared by M3
Engineering along with a team of associates (the "Phase II Report").
The authors of the Phase 2 Report, Stan Timler - M3 Engineering, Mike
Hester - Independent Mining Consultants (Reserves), Dawn Garcia - SRK
Consulting (Environmental), Richard Kehmeier and Brian Hartman -
Pincock Allen & Holt (El Gallo Deposit Resource), John Read - McEwen
Mining consultant (Palmarito Insitu, Historic Waste Dumps and
Historic tailings Resource), are each qualified persons and all of
whom but John Read are independent of McEwen Mining, each as defined
by NI 43-101. For information about the current Los Azules Mineral
Resource, see the Company's news release titled "McEwen Mining
Continues to Expand Los Azules' Large, High-Grade, Mineral Resource,
dated February 5, 2013.
The mineral resource estimate referenced in this news release was
prepared in January 2013 by Robert Sim, P.Geo. and Bruce Davis, PhD,
FAusIMM, each a qualified person and independent of McEwen Mining,
each as defined by NI 43-101. For additional information about the
Los Azules project see the technical Report titled "Los Azules
Porphyry Copper Project, San Juan Province, Argentina" dated August
1, 2012, with an effective date of June 15, 2012, prepared by D.
Ernest Winkler, PE, Robert Sim, PGeo, Bruce Davis, PHD, FAUSIMM and
James K. Duff, PGeo, all of whom are qualified persons and all of
whom but James K. Duff are independent of McEwen Mining, each as
defined by NI 43-101. For additional information about the Tonkin
project see the technical report titled "Technical Report on Tonkin
Project" dated and with an effective date of May 16, 2008. The report
was prepared by Alan C. Noble, P.E., Ore Reserves Engineering and
Richard Gowans, Micon International, and Steven Brown (then US Gold
Corporation) all of whom are qualified persons and all of whom but
Mr. Brown are independent of McEwen Mining, each as defined by NI
43-101. For additional information about the Gold Bar project see the
technical report titled "NI 43-101 Technical Report on Resources and
Reserves Gold Bar Project, Eureka County, Nevada" dated February 24,
2012 with an effective date of November 28, 2011, prepared by J.
Pennington, C.P.G., MSc., Frank Daviess, MAusIMM, Registered SME,
Eric Olin,, MBA, RM-SME, MSc, Herb Osborn, P.E, Joanna Poeck, MMSA,
B. Eng., Kent Hartley P.E. Mining, SME, BSc, Mike Levy, P.E, P.G,
MSc., Evan Nikirk, P. E., Mark Allan Willow, M.Sc, C.E.M. and Neal
Rigby, CEng, MIMMM, PhD, all of whom are qualified persons and all of
whom are independent of McEwen Mining, each as defined by NI 43-101.  
The foregoing news release and technical reports are available under
the Corporation's profile on SEDAR (www.sedar.com). 
CAUTIONARY NON-GAAP MEASURES 
In this report, we have provided information prepared or calculated
according to U.S. GAAP, as well as provided some non-U.S. GAAP
("non-GAAP") performance measures. Because the non-GAAP performance
measures do not have any standardized meaning prescribed by U.S.
GAAP, they may not be comparable to similar measures presented by
other companies.  
Total cash costs consists of geology, mining, processing, general and
administrative costs, royalty costs, refining and treatment charges
(for both dore and concentrate products), sales costs and export
taxes. All-in sustaining cash costs consists of total cash costs (as
noted above), plus corporate general and administrative costs,
environmental rehabilitation costs, mine site exploration and
development costs, and sustaining capital expenditures. Depreciation
is excluded from both total cash costs and all-in sustaining cash
costs. Total cash cost and all-in sustaining cash cost per ounce are
calculated on a co-product basis by dividing the respective
proportionate share of the total cash costs and all-in sustaining
cash costs for the period attributable to each metal by the ounces of
each respective metal sold.  
CAUTIONARY NOTE TO US INVESTORS  
McEwen Mining prepares its resource estimates in accordance with
standards of the Canadian Institute of Mining, Metallurgy and
Petroleum referred to in Canadian National Instrument 43-101 (NI
43-101). These standards are different from the standards generally
permitted in reports filed with the SEC. Under NI 43-101, McEwen
Mining reports measured, indicated and inferred resources,
measurements, which are generally not permitted in filings made with
the SEC. The estimation of measured resources and indicated resources
involve greater uncertainty as to their existence and economic
feasibility than the estimation of proven and probable reserves. U.S.
investors are cautioned not to assume that any part of measured or
indicated resources will ever be converted into economically mineable
reserves. The estimation of inferred resources involves far greater
uncertainty as to their existence and economic v
iability than the
estimation of other categories of resources. 
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS 
This press release contains certain forward-looking statements and
information, including "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. The
forward-looking statements and information expressed, as at the date
of this press release, McEwen Mining Inc.'s (the "Company")
estimates, forecasts, projections, expectations or beliefs as to
future events and results. Forward-looking statements and information
are necessarily based upon a number of estimates and assumptions
that, while considered reasonable by management, are inherently
subject to significant business, economic, political and competitive
uncertainties, risks and contingencies, and there can be no assurance
that such statements and information will prove to be accurate.
Therefore, actual results and future events could differ materially
from those anticipated in such statements and information. Risks and
uncertainties that could cause results or future events to differ
materially from current expectations expressed or implied by the
forward-looking statements and information include, but are not
limited to, risks related to the cost of transferring or otherwise
allocating funds between operating jurisdictions, factors associated
with fluctuations in the market price of precious metals, mining
industry risks, political, economic, social and security risks
associated with foreign operations, risks associated with the
construction and permitting of mining operations and commencement of
production and the projected costs thereof, risks related to
litigation, property title, the state of the capital markets,
environmental risks and hazards, uncertainty as to calculation of
mineral resources and reserves and other risks. Readers should not
place undue reliance on forward-looking statements or information
included herein, which speak only as of the date hereof. The Company
undertakes no obligation to reissue or update forward-looking
statements or information as a result of new information or events
after the date hereof except as may be required by law. See McEwen
Mining's Annual Report on Form 10-K for the fiscal year ended
December 31, 2012 and other filings with the Securities and Exchange
Commission, under the caption "Risk Factors", for additional
information on risks, uncertainties and other factors relating to the
forward-looking statements and information regarding the Company. All
forward-looking statements and information made in this news release
are qualified by this cautionary statement.  
The NYSE and TSX have not reviewed and do not accept responsibility
for the adequacy or accuracy of the contents of this news release,
which has been prepared by management of McEwen Mining Inc. 
Contacts:
McEwen Mining Inc.
Jenya Meshcheryakova
Investor Relations
(647) 258-0395 ext 410 or Toll Free: (866) 441-0690
(647) 258-0408 (FAX) 
McEwen Mining Inc.
Mailing Address
181 Bay Street, Suite 4750
Toronto, ON M5J 2T3
PO box 792 
info@mcewenmining.com
Facebook: facebook.com/mcewenrob
Twitter: twitter.com/mcewenmining
Store: mcewenmining.com/store
 
 
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