Anaconda Mining Reports Q2 2020 Production Results and Provides Update Regarding Annual General and Special Meeting

Q2 2020 Highlights

• Anaconda sold 3,712 ounces of gold in Q2 2020, generating metal revenue of $8.4 million at an average realized gold price¹ of $2,249 (US$1,674) per ounce sold. As at June 30, 2020, the Company had 470 ounces of gold in gold doré inventory, which was subsequently sold in July.
• Point Rousse produced 3,657 ounces of gold in Q2 2020, a 26% increase compared to Q2 2019, due to higher mill availability. Production for the first six months of 2020 was 8,654 ounces.
• Mine operations produced 111,167 tonnes of ore during the second quarter from the Pine Cove open pit at an average grade of 1.22 g/t at a strip ratio of 5.1 waste tonnes to ore tonnes. The Company ended the second quarter with over 36,000 tonnes of ore in stockpiles.
• The Pine Cove Mill processed 118,333 tonnes during Q2 2020 and achieved a recovery rate of 86.4%, an increase in throughput of 22% compared to Q2 2019 when unplanned maintenance of the regrind mill led to lower mill availability.
• Anaconda announced drill results from multiple locations at the Point Rousse Project, including the Argyle Deposit where work is progressing on a mineral resource, reserve, and development plan, and exciting wide, high-grade intercepts at the Stog'er Tight Deposit.
• The Company initiated a 5,500-metre infill diamond drill program at the Goldboro Gold Project, to convert priority Inferred Mineral Resources, considered proximal to planned development under the ongoing feasibility study, into Indicated Mineral Resources.
• On July 16, 2020, Anaconda announced a non-brokered private placement for up to $5.51 million, which will accelerate its highly prospective exploration and diamond drill programs in Atlantic Canada.
• As at June 30, 2020, the Company had a cash balance of $5.5 million, preliminary working capital¹ of $6.1 million, and additional available liquidity of $0.3 million² from an undrawn revolving line of credit facility.

¹ Refer to Non-IFRS Measures Section below.

"During the second quarter, amid the ongoing uncertainty related to the COVID-19 pandemic, Anaconda sold 3,712 ounces of gold to generate metal revenue of $8.4 million at record high Canadian dollar gold prices. We have noted some variability to the block model that has impacted tonnes and grade in the second quarter which we are addressing, plus we have also identified areas of opportunities in the Pine Cove open pit based on ongoing blast hole assays and definition drilling which could positively impact the production profile going forward. We are also advancing the development of Argyle and expect to announce further details on the mineral resource and reserve soon, with the potential to accelerate the contribution of ore from Argyle to production. The second quarter also saw the announcement of strong drill results at Stog'er Tight and the initiation of a 5,500 metre drill program at the Goldboro Gold Project. Our $5.5 million of cash combined with our recent private placement of up to $5.51 million gives us the financial wherewithal to execute our growth strategy."

~ Kevin Bullock, President and CEO, Anaconda Mining Inc.

COVID-19 Pandemic Update - Point Rousse has continued to operate throughout the pandemic and to the Company's knowledge, no employees, contractors, or consultants directly involved with Anaconda, whether at corporate or at site, have been diagnosed with COVID-19. Strict health and safety protocols, including social distancing, remain in place and are continually reviewed based on recommendations from medical authorities. Due to the low number of cases in Atlantic Canada, individuals are now able to move between the provinces and the Company has been able to resume its exploration activities, including at the Tilt Cove Gold Project.

Annual General and Special Meeting

Anaconda Mining Inc. will hold its Annual General and Special Meeting (the "Meeting") on July 30, 2020, beginning at 10:00 AM ET (Toronto). To proactively deal with the unprecedented public health impact of COVID-19, to ensure that no one is unnecessarily exposed to any risks, and to comply with recent Provincial and Federal guidance regarding public gatherings, shareholders and proxyholders are strongly encouraged NOT to attend the Meeting in person. Furthermore, so that the Corporation can mitigate potential risks to the health and safety of shareholders, employees, and the community, there will be strict limitations on the number of persons permitted entry to the Meeting in compliance with Provincial health guidance, and anyone who is not a registered shareholder or proxyholder will not be permitted entry.

The Corporation urges all shareholders to vote by proxy in advance of the Meeting and to virtually attend the Meeting through the live conference call details provided below:

Date and Time: Thursday, July 30, 2020, at 10:00 a.m. (Toronto time)

Dial-in Numbers: (877) 407-8031 or (201) 689-8031

Webcast: https://www.issuerdirect.com/virtual-event/anxto

*Participants should dial in approximately 5 to 10 minutes prior to the scheduled start time.

If events arise that require us to make changes to the date, time and/or location of the Meeting we will promptly notify shareholders and communicate any changes through a press release. The Corporation intends to resume holding unrestricted in-person shareholder's meetings in future years.

Second Quarter Operating Statistics

Operations Overview for the Three Months Ended June 30, 2020

Anaconda sold 3,712 ounces of gold during the second quarter of 2020, generating gold revenue of $8.4 million at an average realized gold price of $2,249 (US$1,674) per ounce sold. Gold production of 3,657 ounces was 26% higher than Q2 2019, due to better mill availability and resulting higher throughput. Low mill availability in Q2 2019 was due to planned maintenance on the main ball mill and unplanned maintenance for the regrind mill. However, gold production in Q2 was down 37% from the first quarter of 2020 due to lower grade, as the mine operation has observed some variability in grade and tonnage in certain lower levels of the Pine Cove pit. Year-to-date production of 8,654 ounces is consistent with the mine plan and the Company remains on track to meet guidance and produce and sell between 18,000 and 19,000 ounces of gold. With mining activity winding down in the Pine Cove open pit, the operation has identified certain opportunities in the pit which may contribute tonnes to the production profile. Also, in light of recent Argyle drill results (see press release dated June 18, 2020) and advancement of the related development plan, the Company is exploring opportunities to accelerate the development of Argyle in the second half of 2020.

¹ Refer to Non-IFRS Measures Section below.

Point Rousse Mill Operations - The Pine Cove Mill processed 118,333 tonnes during Q2 2020, an increase of 22% compared to the second quarter of 2019 when a combination of the planned maintenance on the main ball mill with unplanned maintenance on the head of the regrind mill resulted in low mill availability, which impacted throughput. Since the challenges experienced in the second quarter of 2019, the mill has operated consistently and effectively, maintaining high levels of mill availability and throughput since.

Average grade during Q2 2020 was 1.11 g/t, an 11% decrease over the second quarter of 2019, when mill feed was primarily from the higher-grade Stog'er Tight Mine, and a decrease of 31% from Q1 2020 as the mine experienced variability to the block model in certain lower areas of the pit. The mill achieved an average recovery rate of 86.4%, an increase from 74.7% achieved in Q2 2019 despite the lower grade profile in Q2 2020. The higher throughput and better recovery resulted in gold production of 3,657 ounces, an increase of 26% compared to the second quarter of 2019.

Point Rousse Mine Operations - During the second quarter of 2020, the mine operations produced 111,167 tonnes of ore from the Pine Cove Pit, a 42% increase from Q2 2019, which reflects the higher mining rate at the Pine Cove Pit compared to the lower tonnage profile of mining at Stog'er Tight, which was the main mining area in the prior period. The Company ended the second quarter with an ore stockpile of over 36,000 tonnes.

The mine operations achieved a strip ratio of 5.1 waste tonnes to ore tonnes at the Pine Cove Pit, a decrease compared to Q1 2020 as the operation moves into the bottom levels of the Pine Cove Pit. The strip ratio is expected to continue to decrease throughout 2020. The strip ratio is lower compared to the second quarter of 2019 when mining activity included development of the pushbacks to the Pine Cove Pit.

During the second quarter, the mine operation experienced grade and tonnage variability in lower levels of the pit as it approached the outer limits of the mine model. The operation has also identified further tonnage opportunities from blast hole assays, which it will continue to test moving forward. The Company is also expecting permits for Argyle in early August, which could enable accelerated development of the Argyle Deposit.

Qualified Person

Kevin Bullock, P. Eng., President and CEO, Anaconda Mining Inc., is a "qualified person" as such term is defined in National Instrument 43-101 and has reviewed and approved the technical information and data included in this press release.

ABOUT ANACONDA

Anaconda is a TSX and OTCQX-listed gold mining, development, and exploration company, focused in Atlantic Canada. The company operates mining and milling operations in the prolific Baie Verte Mining District of Newfoundland which includes the fully-permitted Pine Cove Mill, tailings facility and deep-water port, as well as ~11,000 hectares of highly prospective mineral lands including those adjacent to the past producing, high-grade Nugget Pond Mine at its Tilt Cove Gold Project. Anaconda is also developing the Goldboro Gold Project in Nova Scotia, a high-grade resource and the subject of an on-going feasibility study.

NON-IFRS MEASURES

Anaconda has included certain non-IFRS performance measures as detailed below. In the gold mining industry, these are common performance measures but may not be comparable to similar measures presented by other issuers. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Average Realized Gold Price per Ounce Sold - In the gold mining industry, average realized gold price per ounce sold is a common performance measure that does not have any standardized meaning. The most directly comparable measure prepared in accordance with IFRS is gold revenue. The measure is intended to assist readers in evaluating the revenue received in a period from each ounce of gold sold.

Working Capital - Working capital is a common measure of near-term liquidity and is calculated by deducting current liabilities from current assets.

FORWARD-LOOKING STATEMENTS

This news release contains "forward-looking information" within the meaning of applicable Canadian and United States securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management at the date the information is made, and is based on a number of assumptions and is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Anaconda to be materially different from those expressed or implied by such forward-looking information, including risks associated with the exploration, development and mining such as economic factors as they effect exploration, future commodity prices, changes in foreign exchange and interest rates, actual results of current production, development and exploration activities, government regulation, political or economic developments, environmental risks, permitting timelines, capital expenditures, operating or technical difficulties in connection with development activities, employee relations, the speculative nature of gold exploration and development, including the risks of diminishing quantities of grades of resources, contests over title to properties, and changes in project parameters as plans continue to be refined as well as those risk factors discussed in Anaconda's annual information form for the year ended December 31, 2019, available on www.sedar.com. Although Anaconda has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. Anaconda does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

FOR ADDITIONAL INFORMATION CONTACT:

Anaconda Mining Inc.
Kevin Bullock
President and CEO
(647) 388-1842
kbullock@anacondamining.com

Reseau ProMarket Inc.
Dany Cenac Robert
Investor Relations
(514) 722-2276 x456
Dany.Cenac-Robert@ReseauProMarket.com

Anaconda Mining Inc.
Lynn Hammond
VP, Corporate Affairs
(709) 330-1260
lhammond@anacondamining.com

SOURCE: Anaconda Mining Inc.