Capstone Mining* (CS : TSX : $3.00), Net Change: -0.02, % Change: -0.66%, Volume: 1,191,482
More high-grading. Capstone announced assay results from the remaining eight drill holes completed at Minto East as part of
the Phase I evaluation of the underground potential at its high-grade 100%-owned Minto copper-gold mine in the Yukon. These
most recent drill intercepts demonstrate the potential to expand the deeper copper-gold mineralization that is the exploration
focus in 2010. Highlights include Hole 10SWC-599, which intercepted 3.6% Cu, 6.0g/t Au and 8.6g/t Ag over 17.9 m
(including 4.2% Cu, 1.2g/t Au and 9.6g/t Ag over 12.7 m). Drilling is now paused for spring break-up and to allow time to
complete a large survey of deep imaging IP. Drilling will resume in June 2010 with two rigs at Minto East with the objective of
fully defining the extent of the Minto East deposit, which could be a potential source of high grade underground mill feed.
Capstone recently released its Q1/10 operating results for its Cozamin and Minto mines, ahead of the company’s earnings
release scheduled for mid-May. Total copper production of 21.9 million lbs was 7.6% below Canaccord Adams' estimate of 23.6
million lbs, with weaker-than-anticipated production at both mines. However, Capstone reaffirmed its previously-issued 2010
production guidance of 90-100 million lbs of copper. The company is likely to require a significant production ramp up in
H2/10 to reach its guidance range. Despite lower copper production, the company reported on a consolidated basis, cash
operating costs of $1.12/lb which were 6.6% lower than Canaccord Adams' forecast of $1.20/lb. Capstone remains the cheapest
mid-tier copper producer in Canaccord Adams' coverage universe.