Stillwater Reports On 2012 Mine Production and Montana Expansion Projects

BILLINGS, MT - Stillwater Mining reported that its mined production of palladium and platinum for the fourth quarter 2012 was 132,500 ounces and for the year 2012 was 513,700 ounces, exceeding the Company's 2012 guidance of 500,000 ounces. Mined production for 2011 was 517,900 ounces. The Company also reported that mine production guidance for 2013 is again projected at 500,000 ounces.

While not yet finalized, 2012 total cash costs per mined ounce are expected to be at or slightly below 2012 guidance of $500. These will be above total cash costs per mined ounce of $420 for 2011.

Total cash costs for 2013 are expected to average about $560 per mined ounce, reflecting ongoing increases in infrastructure requirements at both of the Company's Montana mines as they continue to go deeper and expand outward, increases in contractual labor commitments, ongoing growth in the Company's workforce, training, safety and mine support efforts to enable the Company's Montana expansion projects, as well as general inflation. While the Company's PGM industry peers face similar cost pressures from deepening and receding face dynamics, Stillwater has fared better due to the stratigraphy of its ore reserve and a more stable operating environment. Furthermore, Stillwater has benefitted from palladium's improved price relationship to that of platinum. For the past 24 months, the palladium to platinum price relationship has averaged 42%, compared to 26% between 2003 and 2010. This improved price relationship has positioned Stillwater as one of the lowest cost primary PGM producers in the world. Given the positive outlook for demand in the auto industry and expected favorable supply demand dynamics for palladium, the Company believes there is an opportunity for the palladium to platinum price relationship to tighten further.

On the recycling side, the Company's volumes increased in the fourth quarter 2012 to 118,600 ounces as PGM prices rebounded late in the year and new shippers emerged. Recycling volumes, which are price sensitive, had dipped during the middle part of 2012, but rebounded as PGM prices increased during the fourth quarter. Total recycling volumes for the year 2012 were 445,200 ounces of palladium, platinum and rhodium compared to 486,700 ounces for 2011.

Commenting on the 2012 results, Frank McAllister, the Company's chairman and CEO, stated, "These are dynamic times in the PGM industry. Our mines continue to perform very well, with stable production, well controlled, competitive cost structures and comparatively modest sustaining capital requirements, while other PGM producers face very significant production, labor and cost challenges. The dynamics of our industry are driven by continued strong growth in demand, particularly for palladium, in the face of ever increasing supply constraints globally. At this point, we find ourselves one of the few PGM producers projecting a long-term growth profile in PGMs, which we believe is built atop a foundation of stable, highly cost competitive and long lived existing operations. In particular, I am pleased to observe that the significant investment we have made in the development of our Montana operations these past several years has now progressed to the point where we can begin to quantify the level of future growth achievable at those operations.

Projecting beyond 2013, Stillwater further advised that it now expects first production from its Graham Creek project at the East Boulder Mine in late 2014, with the project expected to increase total Company production by about 30,000 ounces annually from 2015 and thereafter. In addition, the Company is initiating development of the Far West project, a new as yet undeveloped mining area with attractive ore grades situated within the Stillwater Mine. Once in operation, the Far West area is expected to increase the Stillwater Mine's production by approximately 20,000 ounces initially in 2016, growing to approximately 45,000 ounces in 2017 and thereafter. With Graham Creek and Far West both on line in 2017, estimated annual Company production from the Montana operations should total approximately 575,000 ounces. Beyond 2017, when the Blitz project comes fully online, estimated annual Company production from the Montana operations should total at least 600,000 ounces. The Company expects to gain more clarity on the ultimate production potential of the Blitz project as development there proceeds further.

The Graham Creek project's 8,200-foot tunnel boring machine (TBM) excavation remains on track and will be finished in the first half of 2013. Once complete, it will be followed by the installation of two ventilation raises to surface over the subsequent 18 months. During this time the Company will continue to hire and train additional skilled miners required for the East Boulder Mine and Graham Creek operations. Through the end of 2012, the TBM has advanced about 6,500 feet. While not complete, significant definitional drilling has been performed at the Graham Creek project and minable ore has been identified. Ore grades in this area appear consistent with current grades in the existing portion of the East Boulder Mine. The cost of the Graham Creek project is estimated at $13 million, of which approximately $3.5 million has been charged to the project through the end of 2012.