Capstone Reports Record First Quarter Copper Production & Operating Costs



    
    26.1 million pounds of Copper in Concentrates with estimated Total Cash
    Cost of US$1.05 per Pound of Payable Copper(*)
    

    VANCOUVER, April 14 /CNW/ - Capstone Mining Corp. (CS: TSX) today
announced its production for the three months ended March 31, 2009, with
record production and operating costs from its two operations, the Cozamin and
Minto mines. Combined production totalled 26.1 million pounds of copper in
concentrates, with additional significant by-products of lead, zinc, silver
and gold. The total cash cost, net of estimated by-product credits and
estimated selling costs was US$1.05 per pound of payable copper(*) produced.
Further, March represented the highest ever monthly mill throughput at both
mines and highest pounds of copper produced, illustrating the progress in
ramping up to full production during the quarter.
    "Both of Capstone's operations, the Cozamin and Minto mines, achieved
record quarterly copper production and operating costs in the first quarter of
2009 and the highest production month ever in March," said Stephen Quin,
President & COO of Capstone Mining Corp. "While the ramp-up of the recent
throughput expansions were still being completed at both mines during the
first three months of the year, these results are a credit to the operating
teams at the Cozamin and Minto mines, and bode well for achieving the
Company's production guidance the balance of the year."

    
    Operational Highlights for First Quarter of 2009

    The following is a summary of operational highlights for Capstone during
the first three months of 2009:

    -   Production of 26.1 million pounds of contained copper, which is
        within previously published guidance of 95-105 million pounds of
        copper in concentrates for 2009.

    -   By-product production of 2.4 million pounds of zinc, 1.2 million
        pounds of lead and 0.4 million ounces of silver in concentrates. Gold
        production is not available since assaying is done off site, but is
        estimated at 7,624 ounces for the quarter, based on the mineral
        reserve block model.

    -   Production of 25.2 million pounds of payable copper in concentrates.

    -   Total cash cost per pound of payable copper(*) produced of US$1.05
        versus previously published guidance of approximately US$1.00 per
        pound, which represents good progress in cost reductions since year
        end 2008 and as production ramped up through the quarter.

    -   Cozamin Mine:

           -  Completed ramp-up of Phase III expansion to a nominal 3,000
              tonnes per day ("tpd") of mill throughput, with production
              typically ranging from 3,000 to 3,300 tonnes per operating day
              (excluding maintenance days) and achieving a single day
              throughput record of 4,030 tonnes processed;

           -  Produced 9.8 million pounds of contained copper in
              concentrates, along with by-product 2.4 million pounds of zinc,
              1.2 million pounds of lead and 318,963 ounces of silver;

           -  Processed 248,325 tonnes (2,759 tpd) of ore (100% of budget)
              averaging 1.96% copper, 0.81% zinc, 0.33% lead and 56 grams per
              tonne ("g/t") silver over the 90 day period, representing the
              highest throughput quarter ever and March being the highest
              throughput month ever at 85,000 tonnes processed;

           -  Produced 18,461 dry metric tonnes ("dmt") of copper concentrate
              averaging 24.12% copper, 2,413 dmt of zinc concentrate
              averaging 44.8% zinc and 782 dmt of lead concentrate averaging
              67.1% lead;

           -  Estimated total cash cost, net of estimated by-product credits
              and estimated selling costs, was US$1.00 per pound of payable
              copper(*) produced; and

           -  Announced a new mineral resource estimate for the Cozamin Mine
              on February 18, 2009.

    -   Minto Mine:

           -  Completed Phase III mine expansion to a nominal 3,200tpd of
              mill throughput, supported by increased mine production, which
              rates were regularly achieved in March 2009, where throughput
              typically ranged from 2,900 to 3,500 tonnes per operating day
              (excluding maintenance days) and achieved a single day
              throughput record of over 3,700 tonnes processed;

           -  Produced 16.3 million pounds of contained copper in
              concentrates, along with by-product 101,991 ounces of silver
              (gold is assayed offsite, but is estimated at 7,624 ounces
              based on the mineral reserve block model);

           -  Processed 233,529 tonnes over the 90 day period (2,595tpd) of
              ore averaging 3.4% copper, an estimated 1.4g/t gold and 16g/t
              silver, representing the highest quarterly throughput ever and
              March the highest throughput month at 90,000 tonnes processed;

           -  Produced 17,283 dmt of copper concentrate averaging 42.6%
              copper;

           -  Produced 15.7 million pounds of payable copper at an estimated
              total cash cost(*) of US$1.09 per pound; and

           -  Discovered new zones of higher grade copper mineralization at
              Minto North and southeast of Ridgetop, as announced February 17
              and April 7, 2009.

    -   Kutcho Project:

           -  Published a new mineral resource estimate on February 10, 2009
              that demonstrates the high grade potential of the Kutcho
              Project; and

           -  Began evaluation of options for the development of a smaller
              tonnage, higher grade operation with robust project economics.

    Operating Details - Cozamin Mine

    Key operating statistics for the Cozamin Mine for the first three months
in 2009 are presented below:

    -------------------------------------------------------------------------
                                                                     Q1 2009
    -------------------------------------------------------------------------
    Production(1)
    (contained in concentrates)
    -------------------------------------------------------------------------
    -  Copper (000s pounds)                                            9,812
    -------------------------------------------------------------------------
    -  Zinc (000s pounds)                                              2,388
    -------------------------------------------------------------------------
    -  Lead (000s pounds)                                              1,155
    -------------------------------------------------------------------------
    -  Silver (000s ounces)                                              318
    -------------------------------------------------------------------------
    Mine
    -------------------------------------------------------------------------
    -  Tonnes of ore mined                                           248,507
    -------------------------------------------------------------------------
    Mill
    -------------------------------------------------------------------------
    -  Tonnes processed                                              248,325
    -------------------------------------------------------------------------
    -  Tonnes processed per day                                        2,759
    -------------------------------------------------------------------------
    -  Copper grade (%)                                                 1.96
    -------------------------------------------------------------------------
    -  Zinc grade (%)                                                   0.81
    -------------------------------------------------------------------------
    -  Lead grade (%)                                                   0.33
    -------------------------------------------------------------------------
    -  Silver grade (g/t)                                                 56
    -------------------------------------------------------------------------
    Recoveries
    -------------------------------------------------------------------------
    -  Copper (%)                                                       91.4
    -------------------------------------------------------------------------
    -  Zinc (%)                                                         53.9
    -------------------------------------------------------------------------
    -  Lead (%)                                                         64.8
    -------------------------------------------------------------------------
    -  Silver (%)                                                       71.0
    -------------------------------------------------------------------------
    Concentrate(1)
    -------------------------------------------------------------------------
    -  Copper (dmt)                                                   18,461
    -------------------------------------------------------------------------
    -  Copper (%)                                                       24.1
    -------------------------------------------------------------------------
    -  Silver (g/t)                                                      463
    -------------------------------------------------------------------------
    -  Zinc  (dmt)                                                     2,415
    -------------------------------------------------------------------------
    -  Zinc (%)                                                         44.8
    -------------------------------------------------------------------------
    -  Lead  (dmt)                                                       782
    -------------------------------------------------------------------------
    -  Lead (%)                                                         67.1
    -------------------------------------------------------------------------
    -  Silver (g/t)                                                    1,738
    -------------------------------------------------------------------------
    On site Operating Costs(*) (US$/t milled)(1)                    US$34.97
    -------------------------------------------------------------------------
    Total cash cost per pound(*) of payable copper(1)                US$1.00
    -------------------------------------------------------------------------
    (1) Adjustments based on final settlements will be made in future
        periods.
    

    Overall, the Cozamin Mine performed well, with the new higher grade
stopes on the 10 and 11 levels providing a majority of the ore feed, resulting
in higher copper grades and lower zinc and lead grades. The mill achieved
budgeted production, but periods of successive days in excess of 3,000 tpd of
throughput is encouraging and suggests potential for outperformance. Improved
metallurgical performance, especially in March, resulting from some improved
reagents and regrinding of the copper-lead concentrate, has resulted in higher
copper recoveries, which performance is expected to be sustainable over the
longer term.
    During the first quarter, the Cozamin Mine shipped 21,347 dmt of copper
concentrate averaging 23.8% copper to smelters overseas, all of which will be
recorded as revenue in the first quarter financial statements, when reported.
In addition, there were some additional shipments made in later 2008 that will
also be recognized as revenue in the first quarter of 2009 in the financial
statements, when published.

    
    Operating Details - Minto Mine

    Key operating statistics for the Minto Mine for the first three months of
2009 are presented below:

    -------------------------------------------------------------------------
                                                                     Q1 2009
    -------------------------------------------------------------------------
    Production(2)
    (contained in concentrates)
    -------------------------------------------------------------------------
    -  Copper (000s lbs)                                              16,325
    -------------------------------------------------------------------------
    -  Gold (oz)(1)                                                    7,624
    -------------------------------------------------------------------------
    -  Silver (oz)                                                   101,991
    -------------------------------------------------------------------------
    Mining
    -------------------------------------------------------------------------
    -  Waste (tonnes)                                              2,196,728
    -------------------------------------------------------------------------
    -  Ore (tonnes)                                                  292,593
    -------------------------------------------------------------------------
    -  Total material mined (tonnes)                               2,489,321
    -------------------------------------------------------------------------
    Milling
    -------------------------------------------------------------------------
    -  Tonnes processed                                              233,529
    -------------------------------------------------------------------------
    -  Tonnes processed per day                                        2,595
    -------------------------------------------------------------------------
    -  Copper grade (%)                                                 3.39
    -------------------------------------------------------------------------
    -  Gold grade (g/t)(1)                                              1.40
    -------------------------------------------------------------------------
    -  Silver grade (g/t)                                               16.2
    -------------------------------------------------------------------------
    Recoveries
    -------------------------------------------------------------------------
    -  Copper (%)                                                       93.0
    -------------------------------------------------------------------------
    -  Gold (%)(1)                                                      72.2
    -------------------------------------------------------------------------
    -  Silver (%)                                                       83.6
    -------------------------------------------------------------------------
    Concentrate(2)
    -------------------------------------------------------------------------
    -  Dry tonnes produced                                            17,283
    -------------------------------------------------------------------------
    -  Copper grade (%)                                                 42.6
    -------------------------------------------------------------------------
    -  Gold grade (g/t)(1)                                              13.8
    -------------------------------------------------------------------------
    -  Silver grade (g/t)                                                184
    -------------------------------------------------------------------------
    On site Operating Costs(*) (US$/t milled)(2), (3)               US$62.73
    -------------------------------------------------------------------------
    Total cash cost per pound(*) of payable copper(2), (3)           US$1.09
    -------------------------------------------------------------------------
    (1) Gold is not assayed on site, resulting in a significant lag in
        receiving this data.
    (2) Adjustments based on final settlements will be made in future
        periods.
    (3) Operating costs include mining of ore and waste in excess of what is
        required to sustain operations, some of which costs will be
        capitalized in the financial statements.
    

    The Minto Mine completed its ramp up to its Phase III capacity at the end
of February 2009, with tonnes processed in March slightly exceeding budget.
The Phase 3 North pit pushback of the pit was completed in March and attention
is now focused on stripping the Phase 3 South with mill production coming
entirely from stockpiles. As with prior pushbacks, the Minto Mine will deplete
stockpiles in grade order, from highest to lowest, until the high grade from
the Phase 3 South pit pushback is accessed in the third quarter of 2009.
    During the first quarter, the Minto Mine shipped 19,664 dmt of copper
concentrate averaging 43.1% copper to smelters overseas, all of which will be
recorded as revenue in the first quarter financial statements, when reported.
An additional 9,741 dmt of concentrate grading 42.8% copper were shipped in
early April, revenue for which will be recognized in the second quarter
financial statements. The ice bridge across the Yukon River is now closed, and
no more concentrates will be trucked to Skagway until the barging seasons
commences, likely in June 2009. Also during the period, provisional pricing
adjustments on concentrates shipped but not settled in prior periods, are
settling positively, as a result of higher copper prices on the settlement
date versus the provisional pricing on shipment date. This should positively
impact financial performance for the first quarter 2009. For 2009, Minto's
concentrate off-taker has elected to settle on the basis of shipment date plus
one month, as opposed to plus three months in 2009, reducing the time lag
between provisional payment and final settlement, and likely thereby reducing
the volatility of provisional pricing adjustments.

    
    The TSX does not accept any responsibility for the adequacy or accuracy
    of this press release.
    

    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 resources, 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", "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. 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 resources; possible variations in ore reserves, grade or
recovery rates; accidents, labour disputes and other risks of the mining
industry; delays in obtaining governmental approvals or financing or in the
completion of development or construction activities; 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 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.

    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 and news releases (collectively
the "Disclosure Documents") available under Capstone Mining Corp.'s and
Sherwood Copper 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 economic 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.
    The following employees of Capstone, each a Qualified Person, reviewed
Technical Information contained in this news release: Robert Barnes,
Professional Engineer reviewed Technical Information related to the Cozamin
Mine and Stephen Quin, Professional Geologist reviewed all Technical
Information in this news release. In addition, Kevin Weston and Randall
Thompson reviewed Technical Information related to the Minto Mine.

    (*)Non-GAAP Performance Measures

    "Total Cash Cost per Pound of Payable Copper" and "On site operating
costs per tonne milled" are Non-GAAP Performance Measures. These performance
measures are included because these statistics are key performance measures
that management uses to monitor performance. Management uses these statistics
to assess how the Company is performing to plan and to assess the overall
effectiveness and efficiency of mining operations. These performance measures
do not have a meaning within GAAP 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 GAAP.





For further information:

For further information: about Capstone, please contact: Darren Pylot,
Vice Chairman & CEO; or Stephen Quin, President & COO; Or Mark Patchett,
Investor Relations, at (604) 684-8894 or toll free at (866) 684-8894,
info@capstonemining.com


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