cnw




TSX:SPM


TORONTO, Sept. 17, 2012 /CNW/ - Scorpio Mining Corporation (TSX: SPM)
("Scorpio Mining" or the "Company") is pleased to provide an update on
its corporate, operational and exploration activities and progress
during 2012 and report the Company's action plan for the remainder of
the year.


Highlights of the Company's recent activities and progress are as
follows:



Planned mining and processing is expected to continue at full capacity
for the remainder of 2012


Reducing operational costs


Three months of drilled/blasted ore inventory with good grade to be
sustained at mine


The Updated NI 43-101 compliant mineral reserve estimate for Nuestra
Senora mine is on target for completion in Q4 2012


Completed the installation of a new flash floatation cell at the Nuestra
Senora processing facility, allowing for increased recoveries and
throughput


Processing plant operating at full capacity (1,500 tonnes per day)


Environmental Impact Statement ("EIS") for exploitation permit for El
Cajon deposit to be submitted in October 2012


Completed the definition of the underground development and power
requirements at El Cajon and commenced planning stage


Completed 33,000 meters of 36,000 meter drill program at Nuestra Senora
mine and other deposits


Updated NI 43-101 compliant mineral resource and mineral reserve
estimates for El Cajon and San Rafael are on target for completion by
the end of October 2012


El Cajon Preliminary Economic Assessment ("PEA") on target for
completion by the end of Q4 2012


In-house reports on all exploration projects being compiled


Progressing with search for new Chief Executive Officer






Peter J. Hawley, the Company's interim Chief Executive Officer, stated
"We are pleased to report that, as a result of our operational and
plant improvement efforts at Nuestra Senora, the processing facility is
operating at full capacity and we have completed developed ore stopes
at the mine, which is supplying consistent high grade blended feed. We
have carried out a thorough review of our operations and based on the
results of this review, we are implementing an immediate action plan
that includes continuing to reduce costs and improve efficiency. Our
action plan also features the accelerated development of the El Cajon
deposit in an effort to ensure a sustained flow of plant feed for years
to come. On behalf of the Company's Board of Directors and management,
I thank and congratulate the Scorpio team for their dedicated efforts
in reviewing operations and implementing our cost saving, operational
and exploration initiatives, which have and will continue to improve
the Company's business."


Operations


For the past two months, the Nuestra Senora processing plant has been
operating at its full capacity processing 1,500 tonnes per day (tpd),
while successfully reducing operating costs. Several long-hole stopes
of relatively high metal grades are currently in the process of
becoming operational, which the Company expects will sustain higher
grade feed to the processing plant for the remainder of this year. From
mid-August, head grade of +100 g/t silver plus other metal credits have
been attained. The Company expects to maintain average head grades of
approximately 100 g/t silver plus other metal credits for the remainder
of 2012. In addition, the Company plans to maintain an inventory of
drilled and blasted ore equivalent to three months of production to
enable blending of materials with various other stopes being developed.
As previously announced, the Company has engaged Mine Development
Associates (MDA), an independent expert, to produce a new NI 43-101
compliant reserve estimate for Nuestra Senora in Q4 2012.


Permitting and Development


Land agreements for the Cosala Norte area, which includes the San Rafael
and El Cajon deposits, have been reached and registered with the
Mexican national regulatory body. Environmental studies for the El
Cajon exploitation permit have been completed with the formal
documentation expected to be submitted in early October 2012 to the
Secretaria de Medio Ambiente y Recursos Naturales (SEMARNAT), the
Mexican federal government agency responsible for the permitting
process. The Company expects to receive the first written response from
SEMARNAT in connection with its submission within 60 working days.


In anticipation of receiving the exploitation permit for El Cajon, the
Company has defined the underground development and power requirements
and commenced work to improve the haulage road to its Nuestra Senora
processing plant. Following the permitting process, the Company's goal
is to commence production at El Cajon and feed the ore at the 1,500 tpd
processing plant.


Exploration


To date, the Company has drilled more than 33,000 meters as part of its
36,000 meter 2012 drill program for Nuestra Senora and its properties
in the Cosala and Parral districts. Underground drilling is continuing
at Nuestra Senora at a rate of approximately 1,000 meters per month.


At El Cajon the discovery of the new La Emma trend demonstrates the
exploration potential of the Cosala district.


Given the Company's aggressive drill and exploration programs for 2012,
its main focus at this time is to eliminate all backlogs of sampling
and logging, while awaiting new exploration permits and planning future
drill targets. The Company is also currently compiling baseline work
including: geochemical studies, mapping, geophysical studies, and
review of all historical assay results data in order to prioritize the
exploration targets for future exploration work.


Scorpio Mining's Chief Executive Officer, Mr. Peter J. Hawley, P. Geo,
is a Qualified Person (as defined in NI 43-101) for the Company's
Mexico projects and supervised the preparation of the disclosure
contained in this news release.


About Us


Scorpio Mining Corporation is a silver producer operating in Mexico with
significant base metal by-product credits. The 100% owned Nuestra Senora Mine and plant located in the Cosala District of Sinaloa State, Mexico, has
proven to be a low-cost operation with the benefit of flexible mining
methods and diversified metal production. It has a fully mechanized
underground operation and a processing facility built for expansion to
4,000 tonnes per day. The plant produces zinc, copper and lead
concentrates with a significant silver component in the copper and lead
concentrates. In addition, the company has over 40 exploration targets
mostly in the vicinity of its current operations and is currently
updating its mineral resource estimates for the San Rafael and El Cajon
Projects. Scorpio Mining also holds a 100% interest in the advanced,
high-grade La Revancha silver and Tepozan silver-gold projects, both
located in the productive Parral District within the respective states
of Chihuahua and Durango, Mexico. The Company's strategy focuses on
developing the San Rafael and the El Cajon projects while maintaining
an active regional exploration program at its existing mineral
properties.


ON BEHALF OF SCORPIO MINING CORPORATION


Peter Hawley

CEO