Orosur Mining Inc. Announces Updated Results of the Preliminary Economic Assessment on Pantanillo Norte

SANTIAGO, Chile June 1, 2012. Orosur Mining Inc. ("OMI" or "the Company") (TSX: OMI) (LSE: OMI), a South American-focused gold producer and explorer announces updated results of the Preliminary Economic Assessment ('PEA') on its wholly owned Pantanillo Norte project in Chile. This press release reconciles differences between information in the OMI 12 January 2012 press release and the data in the NI 43-101 Technical Report (the 'Technical Report') that was completed by AMEC International Ingenier�a y Construcci�n Limitada. ('AMEC') which will be filed on SEDAR shortly.

Highlights of the PEA

Summary of Financial Parameters

Mineral Resources

The Preliminary Economic Assessment ("PEA") is based on Mineral Resources, reported at a cut-off grade of 0.3 g/t Au for oxide and mixed material, and 0.5 g/t Au for sulphide material, that include 36.5 Mt grading 0.71 g/t Au in the Measured category, 10.5 Mt grading 0.63 g/t Au in the Indicated category and 0.3 Mt at 0.53 g/t Au in the Inferred category. Mineral Resources are reported at a commodity price of US$1,035/oz gold, and have an effective date of 9 July 2010.

The results of the PEA are partly based on Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves. There is no certainty that the PEA based on these Mineral Resources will be realized. Inferred resources in the PEA mine plan represent 0.12 % of the total recovered ounces.

The Mineral Resource estimates have been prepared in accordance with the 2010 CIM Definition Standards for Mineral Resources and Mineral Reserves as incorporated by reference in National Instrument 43-101 of the Canadian Securities Administrators. The AMEC Qualified Person for the estimates is Ms Mar�a-Ang�lica Gonz�lez, Registered Member, Chilean Mining Commission.

Notes to accompany Mineral Resource Table

• Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
• Mineral resources are reported within a Lerchs-Grossman (LG)-optimized pit shell using Whittle�software with the following assumptions: a gold price of 1,035 US$/oz; mining cost of 1.65 US$/t; processing cost of 4.00 US$/t; general and administration cost of 1.00 US$/t and recoveries of 75.0% for leached and oxide material types, 65.0% for mixed material, and 50.0% for sulphide material
• Copper and arsenic average grades above cut-off are respectively: 0.025% and 144 ppm for Measured plus Indicated and 0.019% and 124 ppm for Inferred
• Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content
• Tonnage and grade measurements are in metric units. Contained gold ounces are reported as troy ounces.

A subset of the Mineral Resources was used in developing the mine plan. AMEC developed a pit design and a preliminary production plan that considers the feed to a heap leach process for the mine life to consist of oxide and mixed mineralized material only. The model used for mine planning was the mineral resource model, with all material in the block model which was not classified as Measured, Indicated or Inferred Mineral Resources within the mixed or oxide domains treated as waste. The subset of Mineral Resources used in the proposed mine plan supports an approximate five-year mine life at a 7 Mt/a process production rate assuming open pit mining and a heap-leach operation.

OMI presented the results of the PEA in a press release dated 12 January 2012. However, in finalizing the independent NI 43-101 report AMEC has updated a number of assumptions from the 12 January 2012 press release which are reflected in the new financial results discussed further below.

The financial results indicated a five-year mine life, with Net Present Value ("NPV) of US$49.7 million (before tax) at a 8 per cent discount rate and Internal Rate of Return ("IRR") of 19 per cent. This represents an increase of about US$ 17.7 million in NPV compared to the figure released in January 2012, and largely reflects the adoption of a new higher long term gold price (US$1,250 vs US$ 1,200).

The overall total estimated capital cost is US$189.2 million, which is an increase of about US$ 11 million from the previous CAPEX figure disclosed in January 2012. All the CAPEX increases were related to the Indirect Construction costs (from US$ 27.8 to 29.7 million) and contingency (from US$ 23.2 to 32.3 million) to reflect current conditions. Key capital costs include mining equipment of US$34 million, process plant costs of US$54 million, and infrastructure costs of US$40 million. Capital cost estimates are at a PEA-level of accuracy, at +/-35per cent.

The gold price of US$1,250/oz was deemed more relevant for a project with a five year mine life. It is still well below the current three year moving average. There is no other credit or sellable product based on current project knowledge. AMEC notes that the gold price used in this financial analysis is higher than that used to estimate Mineral Resources ($1,035/oz Au) and to constrain the subset of Mineral Resources used in the preliminary mine plan ($1,000/oz Au). An Anglo American royalty of 3.5% was considered in the financial analysis.

No taxes were applied since this financial model is showing results before taxes.

Operating costs over the projected life-of-mine reduced from USD 581.2/oz to USD 566.7/oz. Compared to the OPEX released in January 2012, there was a reduction of about US$ 0.20/t on the Process costs, mainly due to the new reagent consumptions adopted, as per the latest metallurgical test work results.

The metallurgical recoveries have been also updated, based on the latest test work results. The recoveries considered in the financial analysis were:

Au recovery oxide material: 79.6 %
Au recovery leached material: 79.6 %
Au recovery mixed material: 44.8 %

There was a slight reduction on the recovery for the oxide and leached material (from 80.27% down to 79.6 %) and a slightly increase for the mixed material (from 43.05% up to 44.8%) compared to the recovery figures released in January 2012.

More details can be found on the full PEA report which will be filed on SEDAR shortly.

David Fowler, Chief Executive Officer commented:

"This PEA is based on the existing resource at Pantanillo Norte and demonstrates Pantanillo�s development potential. We believe that further exploration can significantly enhance the project and a number of initiatives will be pursued to improve the project further."

Water Exploration

OMI announced on November 9, 2011 that the Consortium made up by OMI and the LUMAX S.A. had received a water exploration permit from the Chilean Water authority DGA for its Pantanillo Project in Chile. This latest advancement represented a significant development in the overall permitting process for the project. The consortium has since hired Geohidrolog�a Consultores in Chile to conduct exploration work. Stage 1 of this work has already commenced (started in December 2011, with estimated timeframe to completion of 8 months), and will comprise of:

• Compilation and review of background information (complete)
• Elaboration of preliminary conceptual model (complete)
• Interpretation of geophysics and drilling results (underway)
• Analysis of results and conceptual model adjustment (not commenced)
• Field geology (complete)
• Geophysical prospecting (complete)
• Preliminary drilling prospecting (underway): one deep hole (134 m) and 1 shallow hole (38 m) were drilled and water was found for both of them. The difference in static levels between the two holes indicates the presence of two independent aquifers.

The results cited above are qualitative in nature. In the next summer it is planned to conduct a 250 m deep hole for pumping test to obtain quantitative results.

Next Steps

AMEC has prepared recommendations for the Project development, comprising a two-phase work program.

Phase 1 would consist of data collection for supporting the Pre Feasibility stage. Phase 2 would consist of the completion of a pre-feasibility study.

The following activities are being recommended to be undertaken on phase 1: infill and geotechnical drilling, and further hydrogeological and metallurgical work.

The Phase 2 work program will use the results of Phase 1 to complete a pre-feasibility study that is planned to support a first-time declaration of Mineral Reserves for the Project.

Orosur is currently evaluating AMEC�s recommendations.

The NI 43-101 Technical Report was prepared by Dr Armando Simon (M.AIG, RPGeo), Ms Mar�a-Ang�lica Gonz�lez, RM CMC), Mr Marcelo Hernando (RM, CMC), Dan Russell (RPGeo), and Ms Joyce Maycock, P.Eng., of AMEC. Luis Albano Tondo, for OMI and a Qualified Person as defined by NI 43-101.

Forward Looking Statements

All statements, other than statements of historical fact, contained or incorporated by reference in this news release, including any information as to the future financial or operating performance of the Company, constitute "forward-looking statements" within the meaning of certain securities laws, including the "safe harbour" provisions of the Securities Act (Ontario) and the United States Private Securities Litigation Reform Act of 1995 and are based on expectations estimates and projections as of the date of this news release. There can be no assurance that such statements will prove to be accurate, such statements are subject to significant risks and uncertainties, and actual results and future events could differ materially from those anticipated in such statements. Pantanillo is at an early stage of technical and economic evaluation and the uncertainty of input parameters is consistent with a Scope Study Level. Business risks consist of, but not limited to, metal price being lower than assumed, exchange rate being lower than assumed, manpower shortage to build and operate the project, cost escalation and higher royalties costs than assumed. Geology risks consist of, but not limited to, resource tonnage smaller than estimated and/or gold grades lower than estimated resulting in gold resource tonnage smaller than estimated. Process risks consist of, but not limited to recoveries lower than assumed, reagent consumption higher than assumed, higher leaching time needed to achieve assumed recoveries and assumption that copper and arsenic values will remain under levels likely to prove deleterious in the leach pad. Infrastructure risks consist of, but not limited to, unavailability of water leading to the need to buy water from third parties and the unavailability of power and need to generate own power. The Environmental and Permitting risk consist of, but not limited to, environmental permit delays due to the proximity to the RAMSAR site and delays in permit due to the need to obtain the project acceptance from the local communities. Risks related to Easement and Rights consist of, but not limited to, difficulties in obtaining easements with consequent delays, water right delay or refusal and surface right delay or refusal. Financial and construction risks consist of, but not limited to, underestimated capital and operating costs, project construction delays due to wintery weather and delay in the delivery of main equipment. Forward-looking statements include, without limitation success of exploration activities; permitting time lines; the failure of plant; equipment or processes to operate as anticipated; accidents; labour disputes; requirements for additional capital title disputes or claims and limitations on insurance coverage. The Company disclaims any intention or obligation to update or revise any forward looking statements whether as a result of new information, future events and such forward-looking statements, except to the extent required by applicable law.

About Orosur Mining Inc.

Orosur Mining Inc. is a fully integrated gold producer and exploration company focused on identifying and developing gold projects in Latin America. The Company operates the only producing gold mine in Uruguay (San Gregorio), and has assembled an exploration portfolio of high quality assets in Uruguay and Chile. The Company is quoted in Canada (TSX : OMI) and London (AIM: OMI).

For further information, please contact:
Orosur Mining Inc
David Fowler, CEO
Ignacio Salazar, CFO + 56 2 9246800;

info@orosur.ca

Canaccord Genuity Limited (Nominated Adviser & Broker)
+44 (0) 20 7523 8000
Rob Collins
Andrew Chubb

Blythe Weigh Communications (Investor Relations)
Tim Blythe: +44 (0) 7816 924626
Susan Mckenzie: + 44 (0) 7919 050828
Robert Kellner: +44 (0) 7800 554377

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