Capstone Mining Completes Acquisition of Pinto Valley Mining Operations

   Capstone Mining Completes Acquisition of Pinto Valley Mining Operations

  PR Newswire

  VANCOUVER, British Columbia, October 11, 2013

VANCOUVER, British Columbia, October 11, 2013 /PRNewswire/ --

Capstone Mining Corp. ("Capstone") (TSX: CS) has completed the previously
announced acquisition of the Pinto Valley copper mine and the associated San
Manuel Arizona Railroad Company from BHP Copper Inc., a subsidiary of BHP
Billiton Ltd. ("BHP Billiton").

"The closing of the Pinto Valley acquisition advances us as one of the leading
intermediate copper producers, with a focus in the Americas," said Darren
Pylot, President and CEO of Capstone. "Following the closing of the
transaction, we have retained considerable financial flexibility with a very
conservative capital structure."

The purchase price of US$650 million was funded from cash and Capstone's
credit facilities.

Operations

The restart of the Pinto Valley Mine, which commenced in December 2012, is
continuing with a targeted run-rate of 50,800 tonnes per day by the end of
2013 with annualized production of 130 million to 150 million pounds of copper
per year.

Capstone will commence reporting full operating and production information for
Pinto Valley with its fourth quarter report.

An experienced workforce remains in place, with 98% of Pinto Valley's 650
employees accepting Capstone's offer of employment, including all key
positions. Steve Winkelmann, formerly Capstone's VP of North American
Operations, has been appointed Pinto Valley's Mine General Manager and has
been on site shadowing his BHP Billiton counterpart since early September.
Steve has 40 years of mining experience including large mining operations,
primarily in the US and most recently in Arizona.

Next Steps

The Capstone Pinto Valley team will initially focus on continuing to ramp up
production levels and the integration of the operations to achieve our
targets. At the same time leadership will identify opportunities for cost
reduction, reliability enhancement and throughput maximization.

Capstone believes that considerable potential exists to upgrade the existing
968 million tonnes of Measured and Indicated ("M&I") Mineral Resources
(grading 0.35% copper at a 0.25% cut-off grade) into reserves, potentially
extending the operation beyond the current reserve life as reported by BHP
Billiton. A Preliminary Feasibility Study ("PFS") is underway that will target
the M&I Mineral Resources for potential conversion to reserves, with expected
completion in late 2013 or early 2014. The PFS will consider the potential to
extend operations within the currently permitted boundaries. In addition,
Capstone plans to commission engineering and economic studies to consider all
remaining current mineral resources and their potential for development.

About Capstone Mining Corp.

Capstone Mining Corp. is a Canadian base metals mining company, committed to
the responsible development of our assets and the environments in which we
operate. We are focused on copper, with three producing copper mines; the
newly acquired Pinto Valley copper-molybdenum-silver mine in Arizona, US, the
Cozamin copper-silver-zinc-lead mine located in Zacatecas State, Mexico and
the Minto copper-gold-silver mine in Yukon, Canada. In addition, Capstone has
two development projects, the 70% owned Santo Domingo copper-iron-gold project
in Region III, Chile in partnership with Korea Resources Corporation and the
100% owned Kutcho copper-zinc-gold-silver project in British Columbia, Canada,
as well as exploration properties in Canada, Chile and Mexico. Using our cash
flow and strong balance sheet as a platform, Capstone's strategy is to
continue to grow with continued mineral resource and reserve expansions,
exploration, and through acquisitions in politically stable, mining-friendly
regions. We will pace our growth with our financial capacity, ensuring we
retain, as a priority, sufficient financial flexibility to meet the
requirements of our existing operations and our committed development
projects, while maintaining an adequate cushion to deal with market volatility
and operating risks inherent in the mining industry. Our headquarters are in
Vancouver, Canada and we are listed on the TSX. Further information is
available at http://www.capstonemining.com .

Cautionary Note Regarding Forward-Looking Information

This document may contain "forward-looking information" within the meaning of
Canadian securities legislation and "forward-looking statements" within the
meaning of the United States Private Securities Litigation Reform Act of 1995
(collectively, "forward-looking statements"). These forward-looking statements
are made as of the date of this document and Capstone Mining Corp. (the
"Company") does not intend, and does not assume any obligation, to update
these forward-looking statements, except as required under applicable
securities legislation.

Forward-looking statements relate to future events or future performance and
reflect Company management's expectations or beliefs regarding future events
and include, but are not limited to, statements with respect to the estimation
of mineral reserves and mineral resources, the conversion of mineral resources
to mineral reserves, the timing of completing the PFS and follow-on
engineering and economic studies for Pinto Valley, the anticipated production
from the Pinto Valley Mine, the realization of mineral reserve estimates, the
timing and amount of estimated future production, costs of production, capital
expenditures, success of mining operations, environmental risks, unanticipated
reclamation expenses, title disputes or claims and limitations on insurance
coverage. In certain cases, forward-looking statements can be identified by
the use of words such as "plans", "expects" or "does not expect", "is
expected", "outlook", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes", or
variations of such words and phrases or statements that certain actions,
events or results "may", "could", "would", "might" or "will be taken", "occur"
or "be achieved" or the negative of these terms or comparable terminology. In
this document certain forward-looking statements are identified by words
including "scheduled", "guidance", "plan", "planned", "estimated",
"projections", "projected" and "expected". Forward-looking statements are
based on a number of assumptions which may prove incorrect, including, but not
limited to, the exploration and development potential of the project, current
and future commodity prices and exchange rates and continued daily operation
of the Pinto Valley Mine. By their very nature forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such factors include,
among others, risks related to actual results of current exploration
activities; changes in project parameters as plans continue to be refined;
future prices of mineral resources; possible variations in ore reserves, grade
or recovery rates; accidents; dependence on key personnel; labour pool
constraints; labour disputes; availability of infrastructure required for the
development of mining projects; delays in obtaining governmental approvals or
financing or in the completion of development or construction activities; and
other risks of the mining industry as well as those factors detailed from time
to time in the Company's interim and annual financial statements and
management's discussion and analysis of those statements, all of which are
filed and available for review on SEDAR at http://www.sedar.com . Although the
Company has attempted to identify important factors that could cause actual
actions, events or results to differ materially from those described in
forward-looking statements, there may be other factors that cause actions,
events or results not to be as anticipated, estimated or intended. There can
be no assurance that forward-looking statements will prove to be 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.

Quality Assurance and NI 43-101 Compliance

The technical information in this news release has been prepared in accordance
with Canadian regulatory requirements set out in National Instrument 43-101
Standards of Disclosure for Mineral Projects of the Canadian Securities
Administrators ("NI 43-101") and reviewed by Brad Skeeles, P. Eng., Vice
President, North American Operations (Technical Information related to mining
and production), a "Qualified Person" under NI 43-101. The mineral resource
estimate reported herein for the Pinto Valley property is set out in the NI
43-101 technical report "Pinto Valley Property Mineral Resource Estimate" with
an effective date of February 28, 2013, prepared by Garth Kirkham, P. Geo,
Kirkham Geosystems Ltd., an independent Qualified Person, based on information
provided by BHP Billiton is available on SEDAR. BHP Billiton's mineral reserve
estimate has been publicly reported in the BHP Billiton 2012 Annual Report.

In addition, Gregg Bush, Senior Vice President and Chief Operating Officer for
Capstone Mining Corp. reviewed and approved this news release.

Cautionary Note to United States Investors

This news release contains disclosure that has been prepared in accordance
with the requirements of Canadian securities laws, which differ from the
requirements of U.S. securities laws. Without limiting the foregoing, this
news release refers to a technical report that uses the terms "indicated" and
"inferred" resources. U.S. investors are cautioned that, while such terms are
recognized and required by Canadian securities laws, the SEC does not
recognize them. Under U.S. standards, mineralization may not be classified as
a "reserve" unless the determination has been made that the mineralization
could be economically and legally produced or extracted at the time the
reserve determination is made. U.S. investors are cautioned not to assume that
all or any part of indicated resources will ever be converted into reserves.
U.S. investors should also understand that "inferred resources" have a great
amount of uncertainty as to their existence and as to whether they can be
mined legally or economically. It cannot be assumed that all or any part of
"inferred resources" will ever be upgraded to a higher category. Therefore,
U.S. investors are also cautioned not to assume that all or any part of
inferred resources exist, or that they can be mined legally or economically.
Accordingly, information concerning descriptions of mineralization and
resources contained in this news release may not be comparable to information
made public by U.S. companies subject to the reporting and disclosure
requirements of the SEC.

For further information:Cindy Burnett, VP, Investor Relations and
Communications +1-604-637-8157 cburnett@capstonemining.com
 
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