Capstone Reports Results of Preliminary Economic Assessment on Kutcho
Copper-Zinc Project, BC

    
    Report Benchmarks Development Potential & Key Opportunities for High
    Grade Underground Copper-Zinc Mine
    

VANCOUVER, Sept. 15 /CNW/ - Capstone Mining Corp. (CS: TSX) today announced that its wholly owned subsidiary, Kutcho Copper Corp., has received the results of a Preliminary Economic Assessment ("PEA") from JDS Energy & Mining Inc. on its Kutcho Project in north-western BC. The PEA takes a significantly different approach to the development of the Kutcho Project as compared to prior studies, focusing on the potential for a high grade underground copper- zinc mine with by-product gold and silver credits. Several opportunities are identified in the PEA that could significantly enhance the economic return outlined in the PEA, including enhanced metallurgical performance and reduced power costs and the PEA recommends these opportunities be pursued while advancing the project towards a pre-feasibility study.

"The Kutcho Preliminary Economic Assessment takes a radically different approach to the potential development of the Kutcho copper project," said Stephen P. Quin, President & COO of Capstone. "By going underground, scaling back the throughput and focusing on high grades, we have been able to reduce the capital cost and operating costs and, equally as important, significantly reduce the environmental footprint of the project," he said. "With annual production forecast at approximately 34 million pounds of copper and 42 million pounds of zinc, along with by-product silver and gold, total cash costs* after by-product credits fall to US$1.41 per pound of copper. Opportunities for further optimization have been identified, particularly improved metallurgical recoveries and lower cost power, which now can be pursued."

    
    Highlights of PEA
    -----------------

    The PEA brings the Kutcho Project significantly closer to a viable
development option and identifies key areas that remain to be assessed that
could provide further reductions in costs and improved recoveries, and provide
an attractive development opportunity. These enhancements will be the key
focus in the immediate future. Following are the highlights of the Kutcho PEA:

    -   Pre-production capital costs of C$133.5 million, including a 15%
        contingency;

    -   Small scale open pit followed by underground extraction of the
        majority of the mill feed;

    -   Mill feed of 10.9 million tonnes with an average grade of 2.01%
        copper, 2.80% zinc, 29.8 grams per tonne ("g/t") silver and 0.36g/t
        gold, of which 10.1% is in the inferred category (see comments
        below);

    -   Average annual throughput of 2,500 tonnes per day over a 12 year mine
        life producing separate copper and zinc concentrates, with by-product
        gold and silver reporting to the copper concentrate;

    -   Average annual production of 33.9 million pounds of copper,
        41.7 million pounds of zinc, 2,858 ounces of gold and 454,000 ounces
        of silver in concentrates over the 12 year mine life;

    -   Unit operating costs of C$72.26/tonne milled;

    -   Total cash costs* of US$1.41 per pound of payable copper, net of
        by-product credits and including selling costs;

    -   Significantly reduced environmental footprint as a result of almost
        totally eliminating open pit mining, using tailings and waste for
        backfill underground, and utilization of encapsulated dry-stack for
        tailings that are stored on surface, as well as other improvements;

    -   Defined opportunities for further optimization post-PEA, including
        improved metallurgical performance and reduced power costs that
        could, combined, further enhance the project economics;

    -   The PEA recommends focusing on efforts to crystallize the power and
        metallurgical recoveries prior to advancing to a preliminary
        feasibility study;

    -   The PEA further recommends using the PEA as a basis to re-engage the
        regulators and project stakeholders in order to better understand the
        permitting and approval requirements for this significantly different
        approach to project development.

    * This is a non-GAAP performance measure and readers should refer to
        Non-GAAP Performance Measures note at the end of this news release
        for further details.

    Kutcho Preliminary Economic Assessment Summary
    ----------------------------------------------

    The PEA was compiled by JDS Energy & Mining Inc. ("JDS") for Kutcho Copper
Corporation ("Kutcho Copper"), a wholly owned subsidiary of Capstone Mining
Corporation ("Capstone").

    Changed Approach

    The PEA supercedes and replaces prior development options, which should no
longer be relied upon. The principle changes from prior studies include the
following:

    1.  Inclusion of updated mineral resource estimate for the Main, Esso and
        Sumac deposits, as announced February 9, 2009 that incorporated the
        results of 83 new holes drilled in 2008 within the Main deposit;

    2.  Underground development of the Main and Esso deposits, with only a
        small starter open pit, as compared to the open pit only or large
        open pit and satellite underground options reported previously;

    3.  Reduction in the milling rate to 2,500 tonnes per day ("tpd") as
        compared to the 4,000tpd to 6,000tpd forecast previously;

    4.  Improved waste management plan, using tailings for paste backfill
        underground resulting in reduced dry-stacked tailings on surface, and
        storage of development waste as backfill underground; and

    5.  Significantly reduced area of disturbance.
    

Geology & Mineralization

Kutcho property contains three known Kuroko-type volcanogenic massive sulphide ("VMS") deposits. They are aligned in a westerly plunging linear trend and from east to west they are called the Main, Sumac, and Esso deposits. The largest of the three, the "Main" deposit, comes to surface near the eastern end of this trend, whereas the "Esso" deposit occurs at depths about 400-600m below surface at the western or down plunge end of the trend as it is currently known. The Sumac deposit lies between the Main and Esso deposits both laterally and vertically, but has seen only cursory drilling. The mineralized trend is open down plunge but is poorly explored.

Mineral Resources

The mineral resources for the Kutcho Project were estimated by Garth Kirkham, P.Geo., an independent Qualified Person as defined by NI43-101 and were reported in a news release dated February 9, 2009 but are summarized below for convenience. Readers should review that news release for additional information, including the contribution of each deposit to the overall mineral resource, the mineral resource estimates at different cut-off grades, the parameters used in the estimate and the required NI43-101 disclosure.

    
    Kutcho Project - Mineral Resource Estimate at a 1.5% Copper Cut-Off
                             for All Deposits (1)

    -------------------------------------------------------------------------
                                  Grade                   Contained Metal
                     --------------------------------------------------------
                                                     Copper  Zinc        Sil-
    Class    Tonnes                           Copper (mill- (mill- Gold  ver
             (000's) Copper Zinc Gold  Silver  Equiv. ions   ions (000s (000s
                      (%)   (%)  (g/t) (g/t)  (%)(2)  lb)    lb)    oz)  oz)
    -------------------------------------------------------------------------
    Measured
     (M)      5,421  2.15  2.86  0.34   31.4  3.70  256.6  341.8   59   5,482
    -------------------------------------------------------------------------
    Indicated
     (I)      4,994  2.14  2.83  0.39   33.5  3.74  235.8  312.0   62   5,376
    -------------------------------------------------------------------------
    M & I    10,415  2.14  2.85  0.36   32.4  3.72  492.4  653.8  121  10,857
    -------------------------------------------------------------------------
    Inferred  1,893  2.09  2.93  0.46   33.6  3.78   87.3  122.4   28   2,047
    -------------------------------------------------------------------------
    (1) Numbers may not total due to rounding
    (2) Equivalent copper grade calculated using these metal prices in US$:
        Cu equals $1.50/lb, Zn equals $0.50/lb, Ag equals 12.00/oz, Au equals
        $700.00/oz
    

Metallurgy

As is not uncommon for VMS deposits, the mineralogy of the deposits comprising the Kutcho Project is fine grained and requires a relatively fine primary grind followed by a very fine regrind to produce copper and zinc concentrates at reasonable recoveries and concentrate grades. Extensive test work has been carried out by various owners evaluating a number of metallurgical options, including a preliminary set of tests at SGS Lakefield carried out under Kutcho Copper's direction on pre-2008 core that had been stored in freezers to minimize the risk of oxidation. Based on this test work, the PEA uses the following parameters.

    
            Kutcho Project - Metallurgical Recoveries used in PEA

    -------------------------------------------------------------------------
                   Assumed          Assumed Copper            Assumed Zinc
    Metal         Recovery        Concentrate Grade        Concentrate Grade
    -------------------------------------------------------------------------
    Copper           84%                30.3%
    -------------------------------------------------------------------------
    Zinc             74%                 4.0%                      53%
    -------------------------------------------------------------------------
    Gold             27%                1.76g/t
    -------------------------------------------------------------------------
    Silver           52%                 280g/t
    -------------------------------------------------------------------------
    

As discussed in the opportunities section below, there is potential to improve metallurgical performance, which could benefit the project economics. All core drilled in 2008 is stored in non-oxidizing conditions and is available for the next round of test work.

Mine Plan

The mining resource is summarized by deposit and mining method in the table below. The Main and Esso deposits vary in dip from 30-70 degrees and in width from 3-20m. The Main deposit essentially outcrops on surface and extends to depth of approximately 250m below surface, while the Esso deposit lies approximately 1,500 m to the west and extends to a depth of 400-600m below surface.

A small starter pit will be pre-stripped in Year -1 and will provide ore in Year 1 while the underground mine is being developed. Two underground mining methods are proposed: mechanized cut & fill ("MCF") for the shallow dipping mineralization, and sublevel long-hole ("LH") stoping with backfill for those blocks amenable to bulk mining. The initial pre-production development period is estimated to 18 months. Mine production ramps up to 2,500tpd during the first year from the Main deposit, while production from the Esso deposit commences in Year 5 and continues into Year 9, with Years 10-12 coming only from the Main deposit.

    
                 Kutcho Project - Mining Resource used in PEA
    -------------------------------------------------------------------------
    Mining Area &
    Method*              Tonnes   Cu %   Zn %   Ag g/t   Au g/t   Eq. Cu %
    -------------------------------------------------------------------------
    Main LH             3,056,439   1.84   2.41    27.89     0.29       2.94
    -------------------------------------------------------------------------
    Main MCF            4,793,260   1.98   2.64    28.31     0.31       3.18
    -------------------------------------------------------------------------
    Esso LH             1,436,238   2.10   3.43    34.46     0.45       3.66
    -------------------------------------------------------------------------
    Esso MCF            1,209,563   2.49   4.08    37.45     0.61       4.35
    -------------------------------------------------------------------------
    Main - Starter Pit    446,215   1.88   1.64    23.86     0.26       2.65
    -------------------------------------------------------------------------
    Grand Total        10,941,715   2.01   2.80    29.80     0.36       3.28
    -------------------------------------------------------------------------
    

Of the material within the mine plan, 21.1% is measured, 68.8% is indicated and 10.1% is in the inferred category. Mineral Resources that are not mineral reserves do not have demonstrated economic viability. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied.

    
    Production Summary

    Life of mine production is summarized below.

    -------------------------------------------------------------------------
                                                Production Year
    Parameter    Unit    Total   --------------------------------------------
                                     1        2        3        4        5
    -------------------------------------------------------------------------
    Mill Feed     Kt   10,941.7      904      913      913      913      913
    -------------------------------------------------------------------------
    Copper         %      2.01%    2.01%    2.03%    2.03%    1.94%    2.09%
    -------------------------------------------------------------------------
    Zinc           %      2.80%    2.08%    2.65%    2.69%    2.50%    3.27%
    -------------------------------------------------------------------------
    Gold         g/t       0.36     0.36     0.29     0.29     0.32     0.40
    -------------------------------------------------------------------------
    Silver       g/t      29.80    27.07    29.07    29.12    28.04    31.74
    -------------------------------------------------------------------------
    Cu Con
     Produced    dmt    608,876   50,390   51,302   51,244   49,135   52,960
    -------------------------------------------------------------------------
    Zinc Con
     Produced    dmt    428,288   26,254   33,791   34,250   31,855   41,695
    -------------------------------------------------------------------------
    Copper in
     Cu Con    M lbs      406.7     33.7     34.3     34.2     32.8     35.4
    -------------------------------------------------------------------------
    Gold in
     Cu Con       oz     34,298    2,796    2,274    2,312    2,507    3,203
    -------------------------------------------------------------------------
    Silver in
     Cu Con       oz  5,450,549  409,238  443,431  444,200  427,824  484,170
    -------------------------------------------------------------------------
    Zinc in
     Zn Con    M lbs      500.4     30.7     39.5     40.0     37.2     48.7
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                                      Production Year
    Parameter  --------------------------------------------------------------
                   6        7        8        9        10       11       12
    -------------------------------------------------------------------------
    Mill Feed      913      913      913      913      913      913      913
    -------------------------------------------------------------------------
    Copper       2.17%    2.13%    2.11%    2.00%    1.95%    1.81%    1.81%
    -------------------------------------------------------------------------
    Zinc         3.44%    3.22%    3.19%    3.07%    2.61%    2.46%    2.45%
    -------------------------------------------------------------------------
    Gold          0.44     0.44     0.44     0.39     0.37     0.30     0.30
    -------------------------------------------------------------------------
    Silver       33.16    33.67    33.15    29.46    29.58    26.82    26.65
    -------------------------------------------------------------------------
    Cu Con
     Produced   54,978   53,854   53,409   50,585   49,410   45,835   45,775
    -------------------------------------------------------------------------
    Zinc Con
     Produced   43,790   41,043   40,644   39,077   33,243   31,381   31,264
    -------------------------------------------------------------------------
    Copper in
     Cu Con       36.7     36.0     35.7     33.8     33.0     30.6     30.6
    -------------------------------------------------------------------------
    Gold in
     Cu Con      3,500    3,520    3,467    3,114    2,913    2,355    2,337
    -------------------------------------------------------------------------
    Silver in
     Cu Con    505,923  513,682  505,778  449,487  451,206  409,097  406,513
    -------------------------------------------------------------------------
    Zinc in
     Zn Con       51.2     48.0     47.5     45.7     38.8     36.7     36.5
    -------------------------------------------------------------------------
    

Waste Management Plan

A significant enhancement in the PEA over prior studies is the waste management plan, which should result in significantly reduced surface disturbance and a considerably enhanced abandonment and restoration plan. Tailings, after extraction of recoverable metals, will be either filtered and disposed of underground as paste backfill or filtered and dry stacked within a lined facility in order to minimize potential leakage or oxidation. There will be no conventional tailings storage involved and the tailings facility will be located well away from natural drainages. The underground mine development will generate waste rock, the majority of which is expected to be not potentially acid generating ("non-PAG") rock and will be used to construct civil works and the tailings berm. The remainder of the non-PAG waste and all of the potentially acid generating ("PAG") waste will be stored underground. The small starter pit will be backfilled with tailings and likely covered with non-PAG waste to eliminate potential for acid generation.

Environmental Considerations

The Kutcho Project is not permitted for development or production. The PEA will be used as the basis to re-engage the regulators and stakeholders, including the potentially affected First Nations, in order to re-initiate the permitting process.

Capital Cost

Direct capital costs were estimated at C$90.4 million, including C$18.0 million of off-site infrastructure. Indirect costs and a 15% contingency bring the initial capital cost to a total of C$133.5 million. With the addition of capital leases and LOM sustaining capital, the LOM total capital is estimated at C$161.5 million.

Operating Costs

Total operating costs, including capital leases as an operating expense, are estimated in the PEA as C$72.26 per tonne of ore processed, broken down as follows:

    
                 Kutcho Project - Operating Costs used in PEA
                   -----------------------------------------
                                                  Unit Cost
                   Activity/Item                  (C$/tonne)
                   -----------------------------------------
                   Mining                            $30.88
                   -----------------------------------------
                   Processing                        $24.45
                   -----------------------------------------
                   Administration                    $11.65
                   -----------------------------------------
                   Capital Leases                     $3.11
                   -----------------------------------------
                   Royalties                          $2.17
                   -----------------------------------------
                   Total                             $72.26
                   -----------------------------------------
    

Economic Analysis

The economic assessment in the PEA is preliminary in nature and uses 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, and there is no certainty that this preliminary economic assessment will be realized. The inferred mineral resource used in the mine plan is 10.1% of the total life of mine ("LOM") resource.

Two LOM price scenarios were evaluated. The "Base Case" used prices designed to approximate long term projections with no escalation or de-escalation going forward.

    
             Kutcho Project - Base Case Metal Price Assumptions
    -------------------------------------------------------------------------
                                          Production Year
                      -------------------------------------------------------
    Metal      Unit      1      2      3      4      5      6      7     8-12
    -------------------------------------------------------------------------
    Copper  US$/lb Cu  $2.25  $2.25  $2.25  $2.25  $2.25  $2.25  $2.25  $2.25
    -------------------------------------------------------------------------
    Zinc    US$/lb Zn  $0.70  $0.70  $0.70  $0.70  $0.70  $0.70  $0.70  $0.70
    -------------------------------------------------------------------------
    Gold    US$/oz Au   $750   $750   $750   $750   $750   $750   $750   $750
    -------------------------------------------------------------------------
    Silver  US$/oz Ag $12.00 $12.00 $12.00 $12.00 $12.00 $12.00 $12.00 $12.00
    -------------------------------------------------------------------------

    Case 2 contains metal pricing that is identical to the 2008 SRK Base Case
PEA in order that a direct comparison can be made between the two development
scenarios. The metal price assumptions by case are shown below. All other
"cases" are examined by use of sensitivity analysis.

               Kutcho Project - Case 2 Metal Price Assumptions
    -------------------------------------------------------------------------
                                          Production Year
                      -------------------------------------------------------
    Metal          Unit          1       2       3       4       5       6
    -------------------------------------------------------------------------
    Copper      US$/lb Cu      $2.44   $2.36   $2.29   $2.22   $2.17   $2.13
    -------------------------------------------------------------------------
    Zinc        US$/lb Zn      $1.02   $0.98   $0.95   $0.92   $0.92   $0.92
    -------------------------------------------------------------------------
    Gold        US$/oz Au       $600    $600    $600    $600    $600    $600
    -------------------------------------------------------------------------
    Silver      US$/oz Ag     $10.00  $10.00  $10.00  $10.00  $10.00  $10.00
    -------------------------------------------------------------------------


    ---------------------------------
                  Production Year
             ------------------------
    Metal        7       8      9-12
    ---------------------------------
    Copper     $2.10   $2.09   $2.00
    ---------------------------------
    Zinc       $0.92   $0.92   $0.92
    ---------------------------------
    Gold        $600    $600    $600
    ---------------------------------
    Silver    $10.00  $10.00  $10.00
    ---------------------------------


    The Canadian to $US exchange rate is held constant at a value of 1.20. The
results of the economic analysis are summarized below.

                Kutcho Project - Summary of Economic Analysis
    -------------------------------------------------------------------------
    Item                                   Unit      Base Case      Case 2
    -------------------------------------------------------------------------
    Average Copper Price                  US$/lb       $2.25         $2.14
    -------------------------------------------------------------------------
    Average Zinc Price                    US$/lb       $0.70         $0.93
    -------------------------------------------------------------------------
    Average Gold price                    US$/oz        $750          $600
    -------------------------------------------------------------------------
    Average Silver price                  US$/oz      $12.00        $10.00
    -------------------------------------------------------------------------
    Exchange rate                         C$:US$    $1.20:$1.00   $1.20:$1.00
    -------------------------------------------------------------------------
    Unit Mining Costs                   $/t milled    $30.88        $30.88
    -------------------------------------------------------------------------
    Unit Milling Costs                  $/t milled    $24.45        $24.45
    -------------------------------------------------------------------------
    Unit G&A and Site Services          $/t milled    $11.65        $11.65
    -------------------------------------------------------------------------
    Unit Capital Lease Costs            $/t milled     $3.12         $3.12
    -------------------------------------------------------------------------
    Unit Total Operating Costs          $/t milled    $70.10        $70.10
    -------------------------------------------------------------------------
    Unit Total Operating costs
     (with royalties)                   $/t milled    $72.26        $72.33
    -------------------------------------------------------------------------
    Total Cash Costs* (after Zn,
     Au, Ag credits and offsite costs)   US$/lb Cu     $1.41         $1.24
    -------------------------------------------------------------------------
    Total Capital (excluding sustaining
     capital, capital leases and closure)    $M       $133.5        $133.5
    -------------------------------------------------------------------------
    NPV10% Pre Tax                           $M          $63           $93
    -------------------------------------------------------------------------
    NPV10% After Tax                         $M          $36           $58
    -------------------------------------------------------------------------
    IRR Pre Tax                               %          19%           25%
    -------------------------------------------------------------------------
    IRR After Tax                             %          16%           21%
    -------------------------------------------------------------------------
    Payback Period (After Tax)              Years        5.2           4.1
    -------------------------------------------------------------------------

    * This is a non-GAAP performance measure and readers should refer to
        Non-GAAP Performance Measures note at the end of this news release
        for further details.
    

Sensitivity Analysis

Sensitivity analysis was carried out using metal prices, mill head grade, capital costs and operating costs as variables. Each variable was changed independently. Sensitivities were generated using the NPV@10% discount rate as the measure of project performance. The net present value ("NPV") of the project is most affected by the price of metal or parameters directly affecting revenue such as metal recovery, exchange rate and head grade. Also, project performance is significantly more sensitive to Operating than Capital costs. These results identify two areas on which to focus in order to effect positive changes to economic performance of the Kutcho project. Other than metal pricing which is out of the operator's control, metallurgical recovery, and operating cost control have a marked effect. Capital costs have a relatively small impact on NPV and may be in part a result of using capital leasing to reduce the amount of preproduction capital and in effect moving these burdens to the operating side. Case 2 assumes higher initial metal prices which approximate current spot values but decrease over time to stabilize at long term prices used in the 2008 PEA base case. The boost to revenue for the first several years, due to these higher metal prices, has a positive effect on the project economics. It's also interesting to note that the high sensitivity to revenue enhancing parameters are augmented also and reinforce the needed focus on metal recoveries.

Risks & Opportunities:

Aside from the usual risk associated with the advancement of a mineral project towards a production decision, such as metal prices, resource continuity, mineability, construction risk, capital and operating cost risk, the principal risk related to the Kutcho Project is confirmation of the metallurgical parameters used in the PEA, which were based on preliminary test work completed at SGS Lakefield. Additional test work is required to confirm and potentially enhance the overall metallurgical performance of the project.

The two greatest opportunities to enhance the economics of the project are increased metallurgical recoveries and utilizing a cheaper power supply. These opportunities at Base Case metal prices have been quantified below:

    
    1.  A 10% drop in power cost, from $0.27/kWh to $0.24/kWh increases Base
        Case net present value at a 10% discount rate ("NPV10%") by
        C$8 million to C$44 million and the internal rate of return ("IRR")
        from 16% to 17%;

    2.  An increase in copper recovery to 86% from 84% has the same impact,
        increasing the NPV10% to C$44 million and the IRR to 17%;

    3.  An increase in gold recovery to 50% from 27% also has the same
        impact, increasing the NPV10% to C$44 million and the IRR to 17%; and

    4.  Were grid power to be accessed and assuming BC Hydro's Zone II rate
        of $0.126 per kWh (which would require an additional $22.4 million of
        capital at site and at the Dease Lake plant), the NPV10% would
        increase by C$15 million to $51 million with an IRR of 17%.

    Looking Forward
    ---------------

    With this PEA in hand, Kutcho Copper has now provided a benchmark against
which to evaluate the potential economics for the advancement and development
of the Kutcho Project. From the sensitivities and risks and opportunities
discussed above, it is clear that the emphasis needs to be on enhancing the
metallurgical performance of the Kutcho Project and evaluating options for
lower cost power.

    Technical Report
    ----------------
    

The full PEA, prepared as a NI43-101 compliant Technical Report, will be filed under Capstone Mining's profile on SEDAR at www.sedar.com and available on Capstone's website at www.capstonemining.com/s/Kutcho.asp?ReportID=363270

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

Quality Assurance

The technical information in this news release has been prepared in accordance with Canadian regulatory requirements set out in National Instrument 43-101 and reviewed by Stephen P. Quin, P. Geo., President & COO for Capstone Mining Corp.. The PEA was prepared with input from the following: Michael Makarenko, P.Eng., JDS Energy & Mining Inc.; Wayne Corso, JDS Energy & Mining Inc.; Bob Princewright, P. Eng., JDS Energy & Mining Inc.; Ali Sheykholeslami, P.Eng., JDS Energy & Mining Inc.; Garth Kirkham, P. Geo., Kirkham Geosystems Inc.; David Hendriks, P.Eng., Techpro; and Brad Mercer, P. Geo., Capstone Mining Corp. who are responsible for certain sections of the PEA as detailed in the PEA.

Forward-Looking Statements

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.

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 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. The Company provides 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.

* Non-GAAP Performance Measures

"Total Cash Costs" and "Unit Total Operating Costs" 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.

SOURCE Capstone Mining Corp.

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


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