McEwen Mining Receives Final Environmental Permit

TORONTO, ON - McEwen Mining Inc. reported that the Secretariat of Environment and Natural Resources (SEMARNAT) for the State of Sinaloa, Mexico, has approved the Company's Change of Land Use application for El Gallo 2. This final environmental permit allows for the construction and operation of the proposed mine. El Gallo 2 is projected to produce an average of 95,000 gold eq. ounces per year (5.2 million ounces of silver and 6,100 ounces of gold) at an approximate cash cost of $750 per gold eq. ounce (including all pre-strip and Mexican royalties). All in sustaining costs have been estimated at approximately $800 per gold eq. ounce (including an estimated $5 million per year on exploration). Gold equivalent ounces are calculated by converting silver into gold using a 60:1 exchange ratio.

McEwen Mining and its engineering contractors are conducting on-going studies in order to reduce the estimated capital expenditures associated with El Gallo 2. The Company believes that approximately $20 million in capital costs can be reduced from previous estimates with minimal impact on production by: 1) reducing the number of leach tanks; 2) building a smaller Merrill Crowe process plant / refinery; 3) using modular crushers; and, 4) reducing the number of transformers. To date $10 million of the estimated final construction cost has been spent. With these projected savings and taking into account the funds spent to date, approximately $150 million would be required in order to complete the mine.