Mandalay Resources Corporation reports record production and sales for the second quarter, 2012

TORONTO, July 9, 2012 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX: MND, MND.WT) announced today its production and sales results for the second quarter of 2012.

Production for the three months ended June 30, 2012:

• The Company produced a total of 9,215 ounces ("oz") gold ("Au"), 612 tonnes ("t") antimony ("Sb"), and 814,970 oz silver ("Ag"), representing a total of 29,210 oz of gold equivalent ("Au Eq.") production.
  
  
• Production at Costerfield (Australia) was 4,122 oz Au and 612 t Sb. These represent the highest production volumes since Mandalay assumed management of the mine in the fourth quarter of 2009.
  
  
• Production at Cerro Bayo (Chile) reached record volumes of 5,093 oz Au and 814,970 oz Ag as the planned production ramp-up continued approximately on schedule, augmented by processing of ore stockpiled during the first quarter.

Brad Mills, Chief Executive Officer of Mandalay, commented: "The record second quarter represents our best production and sales quarter ever with both mines producing well. We expect to be able to maintain this level of performance going forward with some growth still to come from Cerro Bayo as the mine remains on track to reach design tonnage of 1,200 tpd in the fourth quarter of 2012."

Table 1. Quarterly Saleable Mine Production for 2011 and 2012

Metal		Source		Q1, 2011		Q2, 2011		Q3, 2011		Q4, 2011		2011 Total		Q1 2012		Q2 2012
Gold (oz)		Costerfield		4,528		2,856		2,057		2,803		12,244		3,690		4,122
		Cerro Bayo		1,450		1,552		1,567		2,109		6,678		2,190		5,093
		Total		5,978		4,408		3,624		4,912		18,922		5,880		9,215
Antimony (t)		Costerfield		512		413		305		346		1,576		489		612
Silver (oz)		Cerro Bayo		339,366		284,324		299,679		395,296		1,318,665		396,624		814,970
Average quarterly prices:
Gold US$/oz				1,386		1,506		1,703		1,685				1,694		1,614
Antimony US$/tonne				14,128		15,898		14,899		13,890				12,692		13,574
Silver US$/oz				31.67		38.56		38.83		31.81				31.78		29.39
Au Eq. (oz)^1		Costerfield		9,747		7,216		4,725		5,655		27,343		7,356		9,273
		Cerro Bayo		9,204		8,832		8,400		9,572		36,008		9,631		19,936
		Total		18,951		16,048		13,125		15,227		63,351		16,988		29,210

¹ Au Eq. oz produced is calculated by multiplying the saleable quantities of Au, Ag, and Sb in the quarter by the respective average market prices of the commodities in the quarter, adding the three amounts to get a "total contained value based on market price", and then dividing that total contained value by the average market price of Au in the quarter.  Average Au price in the quarter is calculated as the average of the daily LME PM fixes in the quarter, with price on weekend days and holidays taken from the last business day; average Sb price in the quarter is calculated as the average of the daily average of the high and low Rotterdam warehouse prices for all days in the quarter, with price on weekend days and holidays taken from the last business day; average Ag price in the quarter is calculated as the average of the daily London Broker's silver spot price for all days in the quarter, with price on weekend days and holidays taken from the last business day.  The source for all prices is www.metalbulletin.com.

Table 2. Quarterly Quantity Sold for 2011 and 2012

Metal		Source		Q1 2011		Q2 2011		Q3 2011		Q4 2011		2011		Q1 2012		Q2 2012
Gold (oz)		Costerfield		4,741		3,229		2,108		2,837		12,915		3,384		4,063
		Cerro Bayo		204		1,297		1,690		2,347		5,538		1,284		4,960
		Total		4,945		4,526		3,798		5,184		18,453		4,668		9,023
Antimony (t)		Costerfield		476		433		279		352		1,540		450		608
Silver (oz)		Cerro Bayo		69,037		270,404		376,409		396,150		1,112,000		218,060		853,364
Average quarterly prices:
Gold US$/oz				1,499		1,469		1,814		1,734				1,715		1,570
Antimony US$/tonne				15,050		16,036		17,326		12,921				12,282		13,123
Silver US$/oz				29.41		39.85		40.50		27.00				32.97		28.68
Au Eq. (oz)^2		Costerfield		9,521		7,955		4,773		5,460		27,709		6,604		9,140
		Cerro Bayo		1,559		8,632		10,093		8,516		28,801		5,475		20,546
		Total		11,080		16,587		14,866		13,977		56,510		12,080		29,687

Sales quantities of all three metals closely matched production quantities in the second quarter, as the Company's shipping schedule at Cerro Bayo returned to normal, recovering from the delays experienced in the first quarter.

About Mandalay Resources Corporation:

Mandalay Resources is a Canadian-based natural resource company with producing assets in Australia and producing and exploration projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.

Forward-Looking Statements:

This news release contains "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the Company's anticipated gold, silver and antimony production and sales in 2012. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading "Risk Factors" in Mandalay's annual information form dated March 31, 2011, a copy of which is available under Mandalay's profile at www.sedar.com. In addition, there can be no assurance that any inferred resources that are discovered as a result of additional drilling will ever be upgraded to proven or probable reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

 

 

Bradford Mills
Chief Executive Officer

Greg DiTomaso
Investor Relations

Contact:
647.260.1566