ANACONDA MINING IMPROVES PINE COVE MILL PERFORMANCE; SHIPS RECORD AMOUNT OF GOLD IN APRIL

TORONTO, May 2 /CNW/ --
TORONTO, May 2 /CNW/ - Anaconda Mining Inc. ('Anaconda') - (TSX: ANX) is
pleased to provide an operational update for its Pine Cove Gold Mine
('Pine Cove'). As reported in the press release dated April 15, 2011,
recently completed modifications to the flotation circuit in the Pine
Cove mill have resulted in the production of  a higher grade flotation
concentrate, which in turn, has delivered better performance in the
back end of the mill, specifically in the leach, filtration and Merrill
Crowe circuits. As a result, overall mill recovery has climbed to the
low to mid 70% range, a significant improvement over the results
achieved in the first three quarters of fiscal 2011. All assays have
been conducted by an external, third-party analytical lab.

President and CEO, Dustin Angelo, stated, 'Over the last few months, we
have demonstrated that the Pine Cove mill can produce a high grade gold
concentrate without sacrificing recovery in its flotation circuit.  We
have also been consistently running at an average rate of approximately
950 to 1,000 tonnes per day of ore throughput at grades around 2 grams
per tonne, and we are confident we can continue to operate the front
end of our mill at these levels.  The concentrate product we now
produce has availed ourselves to many opportunities.  We can ship the
concentrate off site or run it through the back half of our mill. 
We're currently evaluating a few off site options while operating our
leach, filtration and Merrill Crowe circuits.  Over the coming weeks
and months, we plan to settle on the strategy that derives the greatest
amount of cash flow relative to the execution risk.'

Record Gold Production / Shipments:

During the month of April, Anaconda shipped approximately 1,300 dore
ounces of gold (a combination of production from Pine Cove and Nugget
Pond as further described below) to its third-party refiner. Applying a
historical fineness of 82.5%, Anaconda estimates it will yield
approximately 1,070 troy ounces. In addition, the Pine Cove mill had a
circuit inventory of approximately 250 ounces at the time of the last
pour done on April 24(th), with 6 days of production remaining for the month.

President and CEO, Dustin Angelo, further stated, 'Gold shipments from
April have generated a sizable cash infusion and are a testament to the
hard work and perseverance of our employees and service providers.
Since starting up the back half of our mill after the Nugget Pond trial
ended in mid April, we have experienced appreciably better recovery
rates. We continue to see opportunities to improve overall recoveries
in the Pine Cove mill and are currently undertaking a complete circuit
reconciliation to thoroughly evaluate the various test programs to
further optimize all circuits. With these initiatives and the increased
throughput, we can significantly increase gold production.'

Nugget Pond Trial:

On February 25, 2011, Anaconda and Rambler Metals and Mining Canada
Limited ('Rambler') entered into a gold concentrate toll processing
agreement (the 'Agreement') where Rambler would process Anaconda's gold
concentrate from Pine Cove at Rambler's Nugget Pond mill. The purpose
of entering into the Agreement was to conduct a short trial to evaluate
the efficacy of shipping concentrate off-site and processing it through
Rambler's leach and carbon-in-pulp circuits.

Shipments of concentrate commenced in mid March after Anaconda relined
its ball mill and made repairs to its crusher. The trial lasted for
approximately four weeks with the final concentrate shipment occurring
on April 13, 2011. During the trial period, fifty-five truck loads were
processed, each with approximately 30 tonnes of slurry (approximately
16 dry tonnes of solids).  The truck loading, unloading and
transportation ran very smoothly.

The combined recovery between Pine Cove's flotation circuit and
Rambler's leach circuit has been estimated to be in the low to mid 80%
range.  To date, Anaconda has shipped approximately 1,100 dore ounces
of gold at an estimated fineness of 82.5% from the Nugget Pond mill. 
Final calculation of circuit inventory remaining at the Nugget Pond
mill is in progress, which is needed to completely balance the circuit
and ultimately determine the total gold output and recovery from the
trial.

As of the date of this press release, there is no agreement between
Anaconda and Rambler to resume the processing of gold concentrate from
Pine Cove at Rambler's Nugget Pond mill.

Technical Overview of Mill Modifications:

To reduce tonnage to the leach and filtration circuits, a single water
washed Staged Flotation Reactor ('SFR') was added to the flotation
circuit as a cleaner stage.  This unit upgraded the flotation
concentrate from approximately 15 grams per tonne ('g/t') to grades
ranging from 40 to 50 g/t.  This resulted in a reduction in leach and
filter feed tonnage from about 4.5 tonnes per day ('tpd') to 1.5 tpd. 
In addition, the fine clays that plagued the filtration and
clarification circuits have been greatly reduced from the water
washing.  This has resulted in much improved filtration and
clarification to the point where the filters can be operated in series,
significantly improving wash efficiency.  This enhanced filtration in
turn has had a very positive effect on Merrill Crowe and refining
operations.

ABOUT ANACONDA

Anaconda is a Toronto, Canada based mining and exploration company
focused on operating the Pine Cove gold mine located near Baie Verte in
Newfoundland, Canada and, with its joint venture partner, Inversiones
SBX Limitada, advancing the development and exploration of its iron ore
portfolio in Chile.

FORWARD LOOKING STATEMENTS

This document contains or refers to forward-looking information. Such
forward-looking information includes, among other things, statements
regarding the proposed amendment to the expiry date of warrants,
targets, estimates and/or assumptions in respect of future production,
mine development costs, unit costs, capital costs, timing of
commencement of operations and future economic, market and other
conditions, and is based on current expectations that involve a number
of business risks and uncertainties. Factors that could cause actual
results to differ materially from any forward-looking statement
include, but are not limited to: the approval of the amendment to the
expiry date of warrants by the Toronto Stock Exchange; the grade and
recovery of ore which is mined varying from estimates; capital and
operating costs varying significantly from estimates; inflation;
changes in exchange rates; fluctuations in commodity prices; delays in
the development of the any project caused by unavailability of
equipment, labour or supplies, climatic conditions or otherwise;
termination or revision of any debt financing; failure to raise
additional funds required to finance the completion of a project; and
other factors. Additionally, forward-looking statements look into the
future and provide an opinion as to the effect of certain events and
trends on the business. Forward-looking statements may include words
such as 'plans,' 'may,' 'estimates,' 'expects,' 'indicates,'
'targeting,' 'potential' and similar expressions. These forward-looking
statements, including statements regarding Anaconda's beliefs in the
potential mineralization, are based on current expectations and entail
various risks and uncertainties. Forward-looking statements are subject
to significant risks and uncertainties and other factors that could
cause actual results to differ materially from expected results.
Readers should not place undue reliance on forward-looking statements.
These forward-looking statements are made as of the date hereof and we
assume no responsibility to update them or revise them to reflect new
events or circumstances, except as required by law.

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