CAPSTONE
PROVIDES 2008 EXPANSION AND EXPLORATION PLANS AND INCREASES PRODUCTION
FORECASTS FOR 2008 AND 2009
January 17, 2008
VANCOUVER, B.C. - Capstone Mining Corp. ("Capstone")
is pleased to report its 2008 expansion and exploration plans and budgets for
the Cozamin mine located in Zacatecas State, Mexico. All dollar amounts are
stated in U.S. dollars unless otherwise stated.
MINE EXPANSION
Capstone is pleased to report it has started the
expansion of the Cozamin mine from the current rate of 2,200 tonnes per day
("tpd") or 750,000 tonnes per year ("tpy") to 3,000 tpd
or approximately 1 million tpy, a 36% increase in production. This expansion
is expected to be completed by September 2008 at a total budgeted cost of
$9.5 million (including a 15% contingency). The major areas of the expansion
include the following; a new larger production ramp will be driven from
surface down to the internal level 8 decline ramp within the mine
(approximately 1,400m). The internal ramps from level 8 to 12 level will be
enlarged and the underground crusher will be moved to a new dump pocket at
level 11.5. This larger production ramp will provide the required additional
ore haulage capacity and will compliment the 2,000 tpd shaft as well as
allowing larger sized trucks to transport ore to surface. The cost of the
ramp and equipment is estimated to be $4.0 million. A new 115kV high tension
power line and substation will be constructed to supply up to 7.5mW to the
mine. A 1.5mW generator will also be added to provide additional power to the
mine before power line completion and will be used as an emergency power
supply in the future when power outages occur. The upgrade in power is
estimated to cost $3.6 million. Modifications within the plant include
increasing belt sizes within the crushing area and larger floatation cells to
handle the increase in concentrates. This is estimated to cost $1.2 million.
An additional 6m lift will be added to the tailings dam at a cost of
$700,000.
PRODUCTION FORECAST
As a result of the expansion to 3,000 tpd, Capstone
is revising upward its 2008 and 2009 metal production forecast as follows;
|
2008F
|
2009F
|
|
|
|
Tonnes milled
|
850,000
|
1,000,000
|
|
|
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Copper (payable lbs)
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30,000,000
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40,000,000
|
Silver (payable ozs)
|
1,300,000
|
1,500,000
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Zinc (payable lbs)
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9,000,000
|
10,000,000
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Lead (payable lbs)
|
5,100,000
|
5,000,000
|
EXPLORATION
A total of 18,000 m of underground drilling and 650
m of underground drifting are planned within the Cozamin mine. This drilling
will be to upgrade existing inferred resources to the measured and indicated
categories as well as to continue to explore to depth. This 2008 program is
budgeted to cost $2.5 million (including a 15% contingency).
An additional 6,500 m will be drilled from surface
to explore the Mala Noche vein along strike and outside of the current
resource area. The program is budgeted at $1.7 million (including a 15%
contingency).
Robert B. Barnes, P.Eng, Vice President of
Operations for Capstone and a qualified person under NI 43-101, has reviewed
and approved the contents of this news release.
ABOUT CAPSTONE
Capstone is a Canadian based mining company
currently operating the 100% owned Cozamin copper-silver-lead-zinc mine
located in Zacatecas State, Mexico. Capstone has approximately 81.4 million
shares outstanding and is well financed with no bank debt. More information
is available online at: www.capstonemining.com.
For further information about the Company, please
contact:
Chris Tomanik or Mark Patchett, Telephone: (604) 684-8894 / Facsimile: (604)
688-2180
Email: ctomanik@capstonemining.com
or mpatchett@capstonemining.com
This press release contains "forward-looking
information" that is based on Capstone's current expectations,
estimates, forecasts and projections. Forward-looking information is
subject to known and unknown risks, uncertainties and other factors that may
cause Capstone's actual results, level of activity, performance or
achievements to be materially different from those expressed or implied by
such forward-looking information. Such factors include, but are not
limited to: projected sales or production rates; uncertainties related
to drilling results; the ability to raise sufficient capital to fund
exploration; changes in economic conditions or financial markets; changes in
prices for costs; litigation, legislative, environmental and other judicial,
regulatory, political and competitive developments; technological or
operational difficulties or inability to obtain permits encountered in
connection with exploration activities; and labor relations matters.
This list is not exhaustive of the factors that may
affect our forward-looking information. These and other factors should
be considered carefully and readers should not place undue reliance on such
forward-looking information. Capstone disclaims any intention or
obligation to update or revise forward-looking information, whether as a
result of new information, future events or otherwise.
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