Capstone Beats 2019 Cost Guidance, Commences PV3 Optimization Study
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
1
February 11, 2020
Capstone Beats 2019 Cost Guidance, Commences PV3 Optimization Study
(All amounts in US$ unless otherwise specified)
Vancouver, British Columbia - Capstone Mining Corp. (“Capstone” or the “Company”) (TSX:CS) announced its
production and financial results for the three months (“Q4 2019”) and year ended December 31, 2019. Copper
production for 2019 totaled 153.4 million pounds of copper at consolidated C1 cash costs1 of $1.78 per pound.
For full financial and operational results, refer to Capstone’s 2019 Management’s Discussion and Analysis and
Consolidated Financial Statements (“MD&A and Financial Statements”).
“We are pleased to announce that we finished 2019 above the mid-range on production guidance and below the
bottom end of the guidance range on cash costs,” said Darren Pylot, President and CEO of Capstone. “Our two
operations have near-term growth that combined will lead to a 20% boost to production and a 10% reduction in
costs by 2021, but we are not stopping there. Today we are announcing a PV3 Optimization Study at Pinto Valley
that will look at a number of low capital, quick payback projects aimed at debottlenecking various areas of the
operation to enhance overall performance at Pinto Valley. The previously announced $15 million secondary
crushers and ball mill shells replacement, scheduled in 2020, will be the first of many expected projects that
collectively will debottleneck the operation. Overall, we believe there is room to push copper production
significantly higher and costs lower at Pinto Valley.”
Mike Wickersham, General Manager of Pinto Valley Mine, said, “During the month of November, we strategically
advanced maintenance on key areas of the crushing plant to set up for an operational test in December, designed
to push throughput levels beyond previously understood limits. From this, Pinto Valley achieved 18 days above
60,000 tonnes per day (“tpd”), an all-time average weekly throughput record of 63,517 tpd and an all-time daily
tonnage record of 70,334 tpd. We have launched a PV3 Optimization Study to assess how we can sustainably
achieve performance like this. The report will be shared in the second half of 2020. ”
Mr. Pylot continued, “2019 was a transformational year for Cozamin and it was due to exploration excellence, as
we have announced some of the best drill results in its 13 year history for Capstone. Cozamin has always been
the cornerstone cash flow asset for the Company and its current exploration success will ensure it stays that way
for at least the next 10 years.”
Q4 2019 HIGHLIGHTS AND SIGNIFICANT ITEMS
• Capstone achieves higher than the mid-point of 2019 production guidance and delivers costs below
the low end of C1 cash costs1 guidance. 2019 production of 153.4 million pounds of copper is in the top
half of the guidance range of 145-160 million pounds and consolidated C1 cash costs1 of $1.78 per payable
pound of copper is lower than guidance of $1.80-$2.00 per payable pound.
• Q4 2019 copper production of 35.4 million pounds and C1 cash costs1 of $1.97 per payable pound
produced. Copper sales were higher at 40.3 million pounds due to the inventory drawdown at Pinto Valley.
Pinto Valley Q4 2019 copper production was impacted by downtime in the fine crushing plant which enabled
the Company to perform maintenance upgrades and then perform an operational test in December, see
below.
• In December, Pinto Valley conducted a test to push throughput levels a minimum of 10% higher and
was able to achieve 18 days in excess of 60,000 tonnes per day (“tpd”) and reached an all -time record
daily tonnage of 70,334 tpd on December 21, 2019. The objective of the test was to generate a list of
bottlenecks that could potentially be overcome with low capital projects or operational improvements. A PV3
Suite 2100 – 510 West Georgia Street
Vancouver, BC, V6B 0M3, Canada
Tel: 604-684-8894 Fax: 604-688-2180
www.capstonemining.com
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
2
Optimization report is expected to be announced in H2 2020 along with a PV4 100,000+ tpd expansion study.
Refer to the Corporate Update section for details.
• Q4 2019 net income of $13.4 million from continuing operations (Q4 2018 – net loss from continuing
operations of ($15.2) million), which was positively impacted by higher sales volumes and a lower income tax
expense (driven primarily by the recognition of $23.2 million of deferred tax assets associated with previously
unrecognized corporate tax pools).
• Q4 2019 operating cash flow before changes in working capital of $20.3 million (Q4 2018 of $11.2
million).
• The Company achieved its goal of removing $27.5 million of annualized costs out of the business.
Pinto Valley delivered an additional $2.5 million in sustainable annualized cost savings in Q4 2019 totalling
$15 million in reductions on a full year basis, which is a reduction in overall site operating costs of
approximately $0.80 per tonne milled. Refer to the Corporate Update section for details.
• In Q4 2019, the Board approved the first phase of the PV3 Optimization study with a $15 million capital
investment to improve mill reliability and overall performance at Pinto Valley. The expected result is
increased and sustainable throughput to between 56,000 to 57,000 tpd in 2021 and beyond. The one- year
payback is calculated based on expected higher throughput, reduced maintenance and power costs, as well
as increased copper recovery associated with improved copper mineral liberation prior to flotation.
• In Q4 2019, Cozamin’s raisebore project Phase 1 was completed two months ahead of schedule.
Ventilation to the upper section of the one-way ramp immediately improved when the reaming head broke
through to surface in December 2019. The project is expected to be completed in early 2020.
• Cozamin has announced the results from 150 holes of a 200 hole 2019/2020 infill drilling program,
aiming to double the current reserve base. Positive drill results pointing to potentially higher grades and
wider intercepts than in the current reserve, as well as an expanded high grade resource, were released on
November 5, 2019, December 2, 2019 and January 16, 2020. Mineral Resource and Mineral Reserve
estimates will be updated in late 2020.
CORPORATE UPDATE
Cost Reduction Program
Capstone has achieved its cost reduction target range of $25 to $30 million, using 2018 as a baseline. The
Company has now removed $27.5 million of costs out of the business with $15 million in savings at Pinto Valley,
resulting in a decrease in site operating costs of approximately $0.80 per tonne milled. Other areas of sustainable
annualized savings include $3.5 million related to the new revolver terms and improved cash management, $4
million from downsizing of corporate administration and $5 million related to the disposition of Minto.
Cozamin: Near-Term Expansion Update
Development work on the one-way ramp system at Cozamin to debottleneck mine haulage continues on budget
and on schedule for completion by the end of 2020. The concurrent development of the raisebore to improve
ventilation in the southeast part of the mine is ahead of schedule and is expected to be completed in early 2020.
Phase 1 completed ahead of schedule when the reaming head broke through to surface in December 2019, and
immediately improved ventilation to the upper section of the new one- way ramp. Once these two underground
expansion projects are completed, Cozamin’s annual production for 2021 and beyond is expected to increase to
approximately 50 – 55 million pounds of copper and 1.5 million ounces of silver.
Cozamin: Doubling the Mine Life
The 2019/2020 infill drilling program is progressing well and is approximately two months ahead of schedule,
allowing flexibility to add more holes than originally planned. The drill program is aiming to upgrade Inferred
Mineral Resources to Indicated category and subsequent conversion to Miner al Reserves to support doubling the
mine life. Positive drill results pointing to higher grades and wider intercepts than in the current Mineral Reserve
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
3
were released on November 5, 2019, December 2, 2019 and January 16, 2020. Mineral Resource and Mineral
Reserve estimates are expected to be updated in late 2020.
During Q4 2019, Cozamin started drilling into the Portree claimblock (“Portree”) it acquired earlier in the year.
Prior to this, Portree was an untested inlier within Cozamin’s land position covering the Mala Noche Footwall
Zone (“MNFWZ”) area. Portree is surrounded by high grade Inferred Mineral Resources that future drilling is
expected to increase to Indicated categorization. Mining has already started within the newly acquired Portree
claim.
Pinto Valley: Crushing Plant Modernization
In Q4 2019, the Board approved a $15 million capital project as part of the PV3 Optimization study to improve mill
reliability and overall performance at Pinto Valley. The expected result is for throughput to rel iably achieve
between 56,000 to 57,000 tpd in 2021. The one-year payback is calculated based on expected higher throughput,
reduced maintenance and power costs, as well as increased copper recovery associated with improved copper
mineral liberation prior to flotation. Pinto Valley’s 2020 guidance of between 110 to 120 million pounds of copper
production accounts for scheduled downtime for secondary crusher and ball mill shell installations as part of this
capital project.
Pinto Valley: PV3 Optimization & PV4 Expansion
Capstone is focused on incremental low capital investments and operational improvements to increase the mill
tonnage beyond the 56,000 to 57,000 tpd, noted above. An operational test conducted in December 2019, aimed
at pushing throughput levels up 15% to 60,000 tpd or more, was successfully executed. The test realized an all -
time daily throughput record of 70,334 tpd and an all-time weekly throughput record of 63,517 tpd. Data from this
test is currently being studied to determine what is the peak capacity run rate tied to a low capital expansion of
Pinto Valley. The focus of the PV3 Optimization report is to maximize production by systematically
debottlenecking the operation with a series of quick payback projects. All required permits are i n place to operate
at levels up to 79,500 tpd.
Preliminary work on the Pinto Valley future expansion to 100,000+ tpd (“PV4 Expansion”) continues, with an
update expected in H2 2020. The study is focused on evaluating potential scenarios to take advantage of the one
billion tonnes of Mineral Resources not currently scheduled in the current mine plan pit shell (“PV3”).
Santo Domingo Project Progress
The Santo Domingo project is now “shovel-ready” as Capstone has obtained all permits and approvals for the
start of construction from the Chilean authorities. An updated technical report that will include the opportunity to
recover battery-grade cobalt is expected before the end of Q1 2020. Capital expenditures for the fully permitted
project will be kept to a minimum in 2020 to preserve the optionality of the project as we continue the strategic
process to right size or monetize Capstone’s ownership.
Board Appointment
Capstone is also announcing the appointment of SeungWan Shon to the Company’s Board of Directors as
KORES’ nominee, effective February 12, 2020. Min Geol Ryu will be stepping down from the Board of Directors,
also effective February 12, 2020.
Mr. Shon currently leads KORES’ Metals Team, managing overseas copper projects. Mr. Shon has been with
KORES since 2001 and held numerous positions which include Mine Manager, Senior Manager of KORES
Corporate Partnership Team and Senior Manager of the Exploration Team for Nonmetal Mineral Deposits in
South Korea. Mr. Shon holds a Master of Science in Geology from Kyungpook National University, Korea.
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
4
PRODUCTION RESULTS
Refer to Capstone’s 2019 MD&A and Financial Statements for detailed operating results.
Q4 2019 Q4 2018 2019 2018
Copper production (million pounds)
Pinto Valley 26.0 33.0 117.6 119.0
Cozamin 9.4 9.3 35.8 36.2
Total from continuing operations2 35.4 42.3 153.4 155.2
Copper sales
Total from continuing operations2 (million
pounds) 40.3 35.1 152.4 143.5
Realized copper price2 ($/lb.) 2.77 2.66 2.71 2.87
C1 cash costs1 ($/lb.) produced
Pinto Valley 2.35 1.97 2.05 2.16
Cozamin 0.91 0.75 0.90 0.75
Consolidated from continuing operations2 1.97 1.70 1.78 1.83
2 The Minto mine was placed on care and maintenance in Q4 2018 and was considered a discontinued operation under
IFRS 5 up until the date of sale (June 3, 2019).
Consolidated
For the year ended December 31, 2019, C1 cash costs1 of $1.78 per pound produced were lower than 2018 as
well as lower than the guided range. Production was in the top half of the guidance range.
The realized copper price in Q4 2019 of $2.77 per pound was higher than the LME average of $2.67 per pound
due to four provisionally priced shipments at December 31, 2019, which were priced at an average of $2.79 per
pound. The realized copper price in 2019 was $2.71 per pound, compared to $2.87 per pound in 2018 primarily
due to lower gross copper revenue on new shipments of $2.76 per pound in 2019 (2018 was $2.92). Both periods
had the same ($0.05 per pound) provisional adjustments on prior shipments.
Pinto Valley Mine
2019 C1 cash costs1 of $2.05 per pound were lower than 2018, primarily due to the cost reduction program which
lowered site operating costs to $216 million versus $231 million (including capitalized stripping costs). Copper
production in 2019 was similar to 2018.
In Q4 2019, C1 cash costs1 of $2.35 per pound were higher than Q4 2018, driven by lower production. Pinto
Valley undertook downtime in November to perform maintenance in the fine crushing plant prior to conducting an
operational test in December, aimed at running at significantly higher throughput rates. By pushing the operational
limits at Pinto Valley, the information from this test is currently being analyzed to generate a number of
debottlenecking projects from the mine through the mill. As a result of this test, Pinto Valley delivered 18 days in
excess of 60,000 tpd in December, culminating in an all-time record day of 70,334 tpd and an all-time weekly
record of 444,622 tonnes (~63,517 tpd average). The focus now will be to deliver a PV3 Optimizati on Study in H2
2020 that will identify low capital, high impact and quick payback projects to systematically debottleneck the entire
operation so that Pinto Valley can perform at sustainably higher rates while maximizing recoveries, production
and minimizing costs.
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
5
Cozamin Mine
C1 cash costs1 increased in Q4 2019 and 2019 compared with the same periods last year. This increase was
primarily driven by an increase in development in 2019 (11,050 metres versus 9,934 metres) as the mine builds
an inventory of areas to be available for longhole stoping in preparation to support increased mining rates planned
to start in 2021. Production in 2019 was consistent with 2018 results.
FINANCIAL OVERVIEW
Please refer to the Company's MD&A and Financial Statements for the year ended December 31, 2019 and
related notes for a full review of its fourth quarter and full year 2019 financial and operational results.
Q4 20193 Q4 20183 20193 20183 20173,4
Revenue from continuing operations2
($ millions)
113.6 98.0 418.7 415.9 430.4
Net income (loss) from continuing operations
($ millions)
13.4 (15.2) 10.9 7.4 44.6
Net income (loss) ($ millions) 13.4 (39.0) (16.2) (23.6) 55.1
Adjusted net income (loss) ($ millions) 5 (7.8) 3.1 (6.0) 13.4 6.1
Adjusted EBITDA1 from continuing operations2,5
($ millions)
22.5 31.3 102.5 126.6 95.9
Cash flow from operating activities2 ($ millions) 22.1 54.2 92.9 131.1 112.5
Operating cash flow before changes in
working capital1,2 ($ millions)
20.3 11.2 79.8 97.5 129.7
Total assets ($ millions) 1,331.4 1,336.1 1,331.4 1,336.1 1,400.5
Long term debt (excluding financing fees)
($ millions) 209.9 219.9 209.9 219.9 274.9
Net debt1 ($ millions) 165.5 150.1 165.5 150.1 158.7
2 In accordance with IFRS 5, Minto’s results are excluded from revenue but included within cash flow amounts in both the
current and comparative period. The Minto mine was sold on June 3, 2019.
3 Effective January 1, 2019, the Company adopted IFRS 16 Leases (“IFRS 16”) using the modified retrospective method which
applies the standard prospectively, and as such, figures above related to 2018 and 2017 have not been restated to conform to
IFRS 16. Refer to the Accounting Changes section of this MD&A for more information.
4 Effective January 1, 2018, the Company has adopted IFRS 15 Revenue from contracts with customers (“IFRS 15”) using the
modified retrospective method which applies the standard retrospectively to only the most current period presented and as
such, figures above related to 2017 have not been restated to conform to IFRS 15.
5 Certain prior period amounts have been restated to conform with current period classification.
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
6
CONFERENCE CALL AND WEBCAST DETAILS
Capstone will hold a webcast conference call on Wednesday, February 12, 2020 at 11:30 am ET to discuss these
results. The webcast presentation will also be available at https://capstonemining.com/investors/events-and-
presentations/default.aspx.
Date: Wednesday, February 12, 2020
Time: 11:30 am Eastern Time (8:30 am Pacific Time)
Dial in: North America: (877) 823-8676, International: +(825) 312-2240
Webcast: https://event.on24.com/wcc/r/2171294/F77AA7266B25430ED323CFD920385B1B
The conference call replay will be available until February 26, 2020.
Replay: North America: (800) 585-8367, International: +(416) 621-4642
Passcode: 3664037
Following the replay, an audio file will be available on Capstone's website at
https://capstonemining.com/investors/events-and-presentations/default.aspx.
This release is not suitable on a standalone basis for readers unfamiliar with Capstone and should be read in
conjunction with the Company’s MD&A and Financial Statements for the three months and year ended December
31, 2019, which are available on Capstone’s website and on SEDAR, all of which have been reviewed and
approved by Capstone's Board of Directors.
ABOUT CAPSTONE MINING CORP.
Capstone Mining Corp. is a Canadian base metals mining company, focused on copper. We are committed to the
responsible development of our assets and the environments in which we operate. Our two producing mines are
the Pinto Valley copper mine located in Arizona, US and the Cozamin copper -silver mine in Zacatecas State,
Mexico. In addition, Capstone has the large scale 70% owned copper-iron Santo Domingo development project in
Region III, Chile in partnership with Korea Resources Corporation, as well as a portfolio of exploration properties.
Capstone's strategy is to focus on the optimization of operations and assets in politi cally stable, mining-friendly
regions, centred in the Americas. Our headquarters are in Vancouver, Canada and we are listed on the Toronto
Stock Exchange (TSX). Further information is available at www.capstonemining.com.
For further information please contact:
Jerrold Annett, VP, Strategy and Capital Markets
647-273-7351
Virginia Morgan, Manager, IR and Communications
604-674-2268
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 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 our expectations or beliefs
regarding future events. Forward-looking statements include, but are not limited to, statements with respect to the
estimation of mineral resources and mineral reserves, the realization of mineral reserve estimates, the timing and
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
7
amount of estimated future production, costs of production and capital expenditures, the success of our mining
operations, the continuing success of mineral exploration, Capstone’s ability to fund future exploration activities,
environmental risks, unanticipated reclamation expenses and title disputes. In certain cases, forward-looking
statements can be identified by the use of words such as “plans”, “expects”, “budget”, “scheduled”, “estimates”,
“forecasts”, “intends”, “anticipates”, “believes” or variations of such words and phrases, or statements that certain
actions, events or results “may”, “could”, “would”, “might” “will” or “will be taken”, “will ensure” “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 “anticipated”, “guidance”, “plan”, “expanding” and “expected”. By their
very nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that
may cause our actual results, performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by the forward-looking statements. Such factors include,
amongst others, risks related to inherent hazards associated with mining operations and cl osure of mining
projects, future prices of copper and other metals, governmental actions to close borders and ports in response to
a global health crises, compliance with financial covenants, surety bonding, our ability to raise capital, Capstone’s
ability to acquire properties for growth, counterparty risks associated with sales of our metals, use of financial
derivative instruments and associated counterparty risks, foreign currency exchange rate fluctuations, changes in
general economic conditions, accuracy of mineral resource and mineral reserve estimates, operating in foreign
jurisdictions with risk of changes to governmental regulation, compliance with governmental regulations,
compliance with environmental laws and regulations, reliance on approvals, licenses and permits from
governmental authorities, acting as Indemnitor for Minto Exploration Ltd.’s surety bond obligations post
divestiture, impact of climatic conditions on our Pinto Valley and Cozamin operations, aboriginal title claims and
rights to consultation and accommodation, land reclamation and mine closure obligations, uncertainties and risks
related to the potential development of the Santo Domingo Project, increased operating and capital costs,
challenges to title to our mineral properties, maintaining ongoing social license to operate, dependence on key
management personnel, potential conflicts of interest involving our directors and officers, corruption and bribery,
limitations inherent in our insurance coverage, labour relations, increasing energy prices, competition in the
mining industry, risks associated with joint venture partners, our ability to integrate new acquisitions into our
operations, cybersecurity threats, legal proceedings, 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 MD&A of those
statements, all of which are filed and available for review under the Company’s profile on SEDAR at
www.sedar.com. Although the Company has attempted to identify important factors that could cause our actual
results, performance or achievements to differ materially from those described in our forward- looking statements,
there may be other factors that cause our results, performance or achievements not to be as anticipated,
estimated or intended. There can be no assurance that our forward-looking statements will prove to be accurate,
as our actual results, performance or achievements could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on our forward-looking statements.
NATIONAL INSTRUMENT 43-101 COMPLIANCE
Unless otherwise indicated, Capstone has prepared the technical information in this News Release (“Technical
Information”) based on information contained in the technical reports, Annual Information Form and news
releases (collectively the “Disclosure Documents”) available under Capstone Mining Corp.’s company profile on
SEDAR at www.sedar.com. Each Disclosure Document was prepared by or under the supervision of a qualified
person (a “Qualified Person”) as defined in National Instrument 43-101 – Standards of Disclosure for Mineral
Projects of the Canadian Securities Administrators (“NI 43-101”). Readers are encouraged to review the full text
of the Disclosure Documents which qualifies the Technical Information. Readers are advised that mineral
resources that are not mineral reserves do not have demonstrated econom ic viability. The Disclosure Documents
are each intended to be read as a whole, and sections should not be read or relied upon out of context. The
Technical Information is subject to the assumptions and qualifications contained in the Disclosure Documents.
1 This is an alternative performance measure; please see "Alternative Performance Measures" at the end of this release.
8
Disclosure Documents include the National Instrument 43-101 compliant technical reports titled "NI 43-101
Technical Report on the Cozamin Mine, Zacatecas, Mexico" effective October 24, 2018, “Pinto Valley Mine Life
Extension – Phase 3 (PV3) Pre-Feasibility Study” effective January 1, 2016 and
"Santo Domingo Project, Region III, Chile, NI 43-101 Technical Report on Feasibility Study Update" effective
November 26, 2018.
The disclosure of scientific and Technical Information in this news release was reviewed and approved by Brad
Mercer, P. Geol., Senior Vice President, Operations and Exploration (Technical Information related to mineral
exploration activities and to Mineral Resources at Cozamin), Clay Craig, P.Eng, Superintendent Mine Technical
Services – Pinto Valley Mine (Technical information related to Mineral Reserves and Mineral Resources at Pinto
Valley), Tucker Jensen, Senior Technical Advisor – Cozamin Mine, P.Eng (Technical information related to
Mineral Reserves at Cozamin) and Albert Garcia III, PE, Vice President, Projects (Technical Information related to
project updates at Santo Domingo) all Qualified Persons under NI 43-101.
ALTERNATIVE PERFORMANCE MEASURES
Alternative performance measures are furnished to provide additional information. These non- GAAP performance
measures are included in this news release because these statistics are key performance measures that
management uses to monitor performance, to assess how the Company is performing, and to plan and assess
the overall effectiveness and efficiency of mining operations. These performance measures do not have a
standard meaning within IFRS and, therefore, amounts presented may not be comparable to similar data
presented by other mining companies. These performance measures should not be considered in isolation as a
substitute for measures of performance in accordance with IFRS.
As a result of adopting IFRS 16 Leases, cash paid related to sustaining leases is included within all-in sustaining
costs1 from 2019 on a prospective basis. Prior to adoption of IFRS 16 Leases, cash payments related to operating
leases were included within C1 cash costs1 (operating mines) and general and administrative expenses.
Effective January 1, 2019, the Company has adopted IFRS 16 using the modified retrospective application
method, where the 2018 comparatives are not restated and the cumulative effect of initially applying IFRS 16 has
been recorded on January 1, 2019 for any differences identified, including adjustments to opening retained
earnings balance.
CAUTIONARY NOTE TO UNITED STATES INVESTORS
This news release contains disclosure that has been prepared in accordance with the requi rements of Canadian
securities laws, which differ from the requirements of US securities laws. Without limiting the foregoing, this news
release may refer to technical reports that use the terms "indicated" and "inferred" resources. US investors are
cautioned that, while such terms are recognized and required by Canadian securities laws, the SEC does not
recognize them. Under US 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. US investors are cautioned not to assume that all or any part of
indicated resources will ever be converted into reserves. US 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, US 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 US companies subject to the reporting and disclosure requirements of the SEC.