FARALLON ANNOUNCES THIRD QUARTER FINANCIAL AND OPERATING RESULTS

VANCOUVER, Nov. 15 /CNW/ - Farallon Mining Ltd. ("Farallon" or the "Company") (TSX:FAN) announces its financial and operating results for the three months ended September 30, 2010.  Currency amounts are stated in United States Dollars, unless otherwise noted.  This news release should be read in conjunction with the Company's financial statements and MD&A which are available on SEDAR and the Company's website. 

The Company's G-9 mine produced 18.9 million pounds of zinc and 2.0 million pounds of copper in concentrates at a total cash cost¹ of $0.35/lb of payable zinc, generating operating earnings of $5.1 million and $1.6 million in cash from operations before changes in non-cash working capital.

A summary of the results for the three months ended September 30, 2010 ("Q3") compared to the three months ended June 30, 2010 ("Q2") are as follows:

Financial

• Operating earnings of $5.1 million and net income of $1.0 million, down from operating earnings of $11.3 million and net income of $2 million in Q2 as a result of a planned slow down of ore production to 1,500 tpd from 1,815 tpd in Q2. 

• Cash flow from operations before changes in non-cash working capital of $1.6 million, down from $6.6 million in Q2.
• Gross revenues of $28.5 million, down from $39.1 million in Q2.
• Non-GAAP Adjusted EBITDA¹ of $4.5 million, down from $11.4 million in Q2.
• Working capital of $21.8 million at September 30, 2010, down from $24.4 million at June 30, 2010.

Operations

• Mined 139,447 tonnes of ore (average 1,516 tpd), in line with a previously stated target of 1,500 tpd.

• Processed 132,529 tonnes of ore (average throughput 1,441 tonnes per day "tpd) grading 7.8% zinc, 0.94% copper, 118 g/t silver and 1.6 g/t gold. 
• Produced 17,985 tonnes of zinc concentrate and 6,783 tonnes of copper concentrate, containing an estimated 18.9 million pounds of zinc, 2.0 million pounds of copper, 311,638 ounces of silver and 2,926 ounces of gold from the G-9 mine. 
• Recovered 83% zinc, 74% copper, 62% silver and 43% gold from ore into zinc and copper concentrates.
• Sold approximately 20,489 tonnes of zinc concentrate grading 47% zinc and 6,604 tonnes of copper concentrate grading 13% copper.  Payable metals contained in concentrate were 17.6 million pounds of zinc, 1.7 million pounds of copper, 254,008 ounces of silver and 2,284 ounces of gold. 

Metal Prices

• Realized sales prices for zinc and copper were of $0.96/lb and $3.52/lb, respectively, up from Q2 realized prices of $0.89/lb zinc and $3.11/lb copper.

Management Changes

The Company announced the departure of Mr. Kerry Barker as the General Manager of G-9, and has appointed the G9 Administration Manager, Oscar Zelaya, as interim General Manger. 

Exploration

The Company issued an update on exploration activities in a separate news release dated October 20, 2010.

Subsequent Event

On November 15, 2010 the Company announced that it has entered into a Support Agreement with Nyrstar NV ("Nyrstar") pursuant to which Nyrstar has agreed to make an all-cash offer to acquire all of the issued and outstanding shares of the Company by way of a friendly take-over bid at a price of CAD$0.80 per common share (the "Offer"), valuing the Company at approximately CAD$405 million on a fully diluted basis.

The Nyrstar Offer represents a premium of 23% to the Company's closing price on the Toronto Stock Exchange (the "TSX") on November 12, 2010 and a premium of 32% to the Company's volume weighted average price on the TSX for the 20 trading days prior to the announcement of the Offer.

The Company's Board of Directors has unanimously recommended that shareholders tender their shares in favour of the Offer.

Conference Call

Farallon will hold a conference call tomorrow, Tuesday November 16, at 6:00 am Pacific time (9:00 am Eastern) to discuss these results.  The call can be accessed at [phone] or toll-free at [phone].  A live webcast will also be available at www.farallonmining.com. 

Tables of Production and Summary Financial Statements

Production		Q3 2010	Q2 2010	Q1 2010	YTD 2010
Metals (contained in concentrate)
Zinc (000's Pounds)		18,932	26,272	24,950	69,207
Copper (000's pounds)		2,028	2,261	2,139	11,183
Silver (ounces)		311,638	595,309	420,911	1,327,858
Gold (ounces)		2,926	6,722	4,322	13,970
Ore Mined (tonnes)		139,447	155,043	154,580	449,070
Ore Processed (tonnes)		132,529	165,244	152,178	452,951
tonnes per day		1,441	1,816	1,691	1,659
Zinc grade (%)		7.8	8.7	9.1	8.6
Copper grade (%)		0.9	0.9	1.1	1.0
Silver grade (%)		118	222	174	176
Gold grade (%)		1.6	2.7	2.5	2.3
Concentrate
Zinc (DMT)		17,985	25,342	23,365	66,692
Zinc (%)		47.8	47.0	48.4	47.7
Silver (g/t)		211	312	290	277
Gold (g/t)		2.2	2.7	2.3	2.4
Copper (DMT)		6,783	9,011	6,952	22,746
Copper (%)		13.6	11.4	14.0	12.8
Silver (g/t)		870	1,175	909	1,003
Gold (g/t)		8.1	15.5	11.6	12.1
Recovery		Q3 2010	Q2 2010	Q1 2010	YTD 2010
Zinc (%)		83	82	82	82
Copper (%)		74	68	59	66
Silver (%)		62	53	49	54
Gold (%)		43	41	39	41
Costs		Q3 2010	Q2 2010	Q1 2010	YTD 2010
Site Costs (US$/t milled)		$85.61	$64.34	$76.74	$74.80
Total Cash Costs (US$/payable lb zinc) (1)		$0.35	$0.05	$0.36	$0.24

Summary of Consolidated Balance Sheets (USD '000s)
	30-Sep-10	30-Jun-10	31-Mar-10	31-Dec-09
Assets
Cash and equivalents	23,362	28,540	20,900	21,574
Other Current Assets	23,393	16,580	19,680	17,744
Current Assets	46,755	45,120	40,580	39,318
Property, Plant and Equipment	124,809	124,596	125,832	127,530
TOTAL ASSETS	171,564	169,716	166,412	166,848
Liabilities and Shareholders' Equity
Accounts payable and accrued liabilities	15,857	11,622	14,564	15,428
Other Current Liabilities	9,123	9,059	7,778	9,007
Current liabilites	24,980	20,681	22,342	24,435
Long term debt (Credit Suisse)	24,750	27,000	21,900	24,319
Silver Wheaton deferred revenue	65,427	67,682	72,037	74,499
Capital lease obligation	205	-	-	-
Site closure and reclamation obligation	626	604	583	561
Long term liabilities	115,988	115,967	116,862	123,814
Shareholders' equity	55,576	53,749	49,550	43,034
TOTAL LIABILITIES & EQUITY	171,564	169,716	166,412	166,848
Working Capital	21,775	24,439	18,238	14,883
Summary of Consolidated Statements of Operations and Comprehensive Loss (USD '000s)
	Q3	Q2	Q1	Q4
	2010	2010	2010	2009
Gross Sales Revenue	28,486	39,053	37,595	32,343
Cost of Sales	(20,459)	(24,116)	(25,457)	(25,142)
Depreciation, depletion and amortization	(2,964)	(3,607)	(3,018)	(3,244)
Earnings (loss) from operations	5,063	11,330	9,120	3,957
Exploration	1,679	1,063	1,443	599
Office Costs	1,898	2,467	1,675	2,058
Other Expenses (income)	377	5,817	(241)	1,182
Expenses (income)	3,954	9,347	2,877	3,839
Current income tax (recovery) expense	64	17	41	74
Net Earnings (loss)	1,045	1,966	6,202	44
Net Earnings (loss)	1,045	1,966	6,202	44
Depreciation, depletion and amortization	2,942	3,586	3,018	3,244
Accretion of reclamation obligation	22	21	22	(18)
Interest Expense	648	610	604	569
Loss on extinguishment of long-term debt	-	1,133	-	-
Interest Income	8	(11)	(14)	(8)
Current income tax (recovery) expense	64	17	41	74
Standard EBITDA	4,729	7,322	9,873	3,905
Unrealized foreign exchange (gain) loss	(607)	2,021	(1,100)	258
Stock based compensation	328	2,064	269	363
Non-GAAP Adjusted EBITDA	4,450	11,407	9,042	4,526
Summary of Consolidated Statement of Cash Flows (USD 000's)
	Q3	Q2	Q1	Q4
	2010	2010	2010	2009
Earnings (loss) for the period	1,045	1,966	6,202	44
Amortization of Deferred Revenue	(2,255)	(4,355)	(2,462)	(2,304)
Items not involving cash	2,785	8,988	2,267	4,511
Cash Flow from Operations before changes in non-cash working capital	1,575	6,599	6,007	2,251
Changes in non-cash working capital	(2,814)	852	(6,529)	2,156
Cash Flow from (used in) Operations	(1,239)	7,451	(522)	4,407
Investing Activity - Additions to Property Plant Equipment	(2,698)	(2,350)	(1,298)	(1,919)
Financing Activity	(1,848)	4,560	46	9,894
Foreign Exchange Gain (loss)	607	(2,021)	1,100	(1,854)
Increase (Decrease) in cash and equivalents	(5,178)	7,640	(674)	10,528
Cash and equivalents, beginning of period	28,540	20,900	21,574	11,046
Cash and equivalents, end of period	23,362	28,540	20,900	21,574

Farallon operates the G-9 zinc mine on its Campo Morado Property in Guerrero State, Mexico. G-9 is a 1,500 tonnes per day, underground zinc mine with important by-product credits of copper, gold, and silver.  G-9 has total cash costs¹ amongst the lowest of zinc producers worldwide. The Company is targeting to produce at an annualized production rate of 120 million pounds of zinc and 15 million pounds of copper per year.

ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington, President & CEO

Notes:

(1)	Total Cash Costs and Adjusted EBITDA are Non-GAAP Financial Measures.  Please read page 7 of the Company's MD&A for further information.

No regulatory authority has approved or disapproved the information contained in this news release

Forward Looking Information
This news release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects, or is targeting, are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic, financial and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property and/or labor disputes, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com.

Information Concerning Estimates of Indicated Resources
This news release uses the term "indicated resources". Farallon advises investors that although these terms are recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize them. Investors are cautioned not to assume that any part or all of the mineral deposits in this category will ever be converted into reserves.

For further information:

on Farallon, please visit the Company's website at www.farallonmining.com or contact Neil MacRae, Investor Relations Manager, at [phone] or within North America at 1-877-688-2050.