Scorpio Mining to Advance Feasibility Study of an Additional Plant and Plans to Increase its Existing Nuestra Señora Plant Capacity in the Cosalá District

TORONTO, June 27, 2011 /CNW/ --
/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN
THE U.S./

TSX:SPM

TORONTO, June 27, 2011 /CNW/ - Scorpio Mining Corporation (TSX: SPM)
('Scorpio' or the 'Corporation') is pleased to announce that as a
result of internal strategic evaluations, it is seeking to engage a
lead engineering consultant to conduct a feasibility study for a second
plant facility located 14 km northeast of the town of Cosalá and 17 km
north of the existing Nuestra Señora plant by existing road.

Parviz Farsangi, President & CEO comments. 'Our recent focus has been
optimizing the performance of our existing assets, and as results of
the last two quarters clearly show, we are operating at a significantly
higher level than before. The combination of improved performance and
strong metal prices enabled the Corporation to reach a debt-free status
as of May 5, 2011. While continuing with the improvement of our
existing operations and generating significant cash flow, our focus now
is to take advantage of our strong resource base and significant
exploration upside to grow through expansion. We are fast tracking the
required work to enable a decision point on either expanding our
existing plant to designed full capacity or constructing a new plant
situated more central to the majority of our known resource base in the
Cosalá district. While this work is in progress, we have the advantage
to increase the capacity of our existing plant by 50% within a
relatively short time frame.'

The feasibility study will evaluate the viability of a nominal 4,000
tonnes per day (tpd), multi-product concentrator situated proximal to
the historical mines of La Verde and La Estrella, and the San Rafael
and El Cajón deposits where NI 43-101 compliant mineral resources have
been defined as follows (Reference: News Release - October 15, 2009):

Table 1.  Mineral Resource Estimate - San Rafael Deposit (August 12,
2009)

 ______________________________________________________________
|      Zone  | Category |  Tonnes |Ag g/t|Zn %|Pb %|Cu %|Au g/t|
|____________|__________|_________|______|____|____|____|______|
|Main & Upper|Measured  |1,491,000|  92.1|4.07|1.79|0.07| 0.094|
|____________|__________|_________|______|____|____|____|______|
|Main & Upper|Indicated |3,322,000| 100.9|3.70|1.54|0.07| 0.131|
|____________|__________|_________|______|____|____|____|______|
|Main & Upper|Measured &|4,813,000|  98.2|3.82|1.62|0.07| 0.119|
|            |Indicated |         |      |    |    |    |      |
|____________|__________|_________|______|____|____|____|______|
|Main & Upper|Inferred  |    4,000|  93.1|1.90|1.48|0.04| 0.113|
|____________|__________|_________|______|____|____|____|______|
|      120   |Indicated |  645,000| 244.8|0.36|0.08|0.57| 0.248|
|____________|__________|_________|______|____|____|____|______|
|      120   |Inferred  |   43,000| 302.6|0.13|0.01|0.43| 0.207|
|____________|__________|_________|______|____|____|____|______|

Note: Metal prices used in the above estimates are US$12/oz silver,
US$0.80/lb zinc, US$0.70/lb lead, US$2.00/lb copper and US$750 /oz
gold. A 4.5% zinc equivalent cutoff was applied. The NI 43-101
technical report to support this estimate was filed on SEDAR Dec. 4,
2009. Mineral resources that are not reserves do not have demonstrated
economic viability.

Table 2.  Mineral Resource Estimate - El Cajón Deposit (October 8, 2009)

 ______________________________________
|Category |  Tonnes |Ag g/t|Cu %|Au g/t|
|_________|_________|______|____|______|
|Indicated|1,751,000| 161.7|0.54|  0.25|
|_________|_________|______|____|______|
|Inferred |  545,000| 138.5|0.49|  0.20|
|_________|_________|______|____|______|

Note: Metal prices used in the above estimate are US$12/oz silver, US$2.00/lb copper and US$750 /oz gold. A 100 g/t silver equivalent cutoff was applied. The NI 43-101
technical report to support this estimate was filed on SEDAR Dec. 4,
2009. Mineral resources that are not reserves do not have demonstrated
economic viability.

Some components of the feasibility study are actively being advanced;
including, an 8,000-metre surface drilling program currently under
tender that will cover infill, extension and sterilization drilling of
the San Rafael and La Verde mineralization. One of the key objectives
of this study will be to upgrade mineral resources within the San
Rafael, La Verde and El Cajón deposits to NI 43-101 compliant mineral
reserves. It is anticipated that the feasibility study will be
completed by Q3 2012.

The Corporation's internal strategic evaluation also concluded that
notwithstanding the feasibility study for the addition of a second
plant, the existing Nuestra Señora processing facility should be
expanded by 50%, taking production from 1,500 tpd to 2,250 tpd. The ore
for the expanded plant would be sourced from the Nuestra Señora mine
and supplemented with high-grade material from the Candelaria deposit
and the La Verde mine.  The completion schedule of this expansion will
depend upon the sourcing of major processing components, but is
expected to be completed before second half of 2012. 

This expansion does not preclude additional expansion of the Nuestra
Señora processing facility in the future. This will be determined
pending the results of the feasibility study on the proposed new plant
as well as continued exploration success in the Cosalá district. The
Corporation has the advantage of multiple options from which to select
the best cost-benefit growth scenario.

The La Verde mine, located approximately 20 km by road from the Nuestra
Señora processing plant, is currently being refurbished and small
quantities of high-grade ore are being metallurgically tested through
the plant.

The Candelaria underground deposit is situated above the Nuestra Señora
mineralization and is connected to the Nuestra Señora mine via an
existing haulage ramp. The Corporation is currently developing two
levels at Candelaria to assess the viability of mechanized mining
techniques.  The high-grade nature of the deposit was verified in
2004-2005, where results from 53 underground drill holes returned >300
g/t silver and >1,000 g/t silver in 56% and 22% of sampled
intersections respectively (average sampled core length was 2.2 m). The
mineralization is variably enriched in other metals, returning best
assays of 7.69% copper, 23.51% zinc, 15.21% lead and 13.55 g/t gold.
Candelaria exhibits the typical pinch and swell nature of carbonate
replacement deposits and exhibits high variation in widths and grades
of mineralization over short distances (Reference: News releases dated
October 7, 2004 to May 12, 2005).

Scorpio Mining's Mexico Country Manager, John A. Sadek, B.Eng. (Mining),
MAusIMM, is a Qualified Person for the Corporation's Mexico projects
and has reviewed the content of this section of the release.

ON BEHALF OF SCORPIO MINING CORPORATION

Parviz Farsangi


President & CEO

This news release includes certain statements that may be deemed
'forward-looking statements' within the meaning of the United States
Private Securities Litigation Reform Act of 1995 and applicable
Canadian securities legislation. Forward-looking statements include,
but are not limited to, statements with respect to the Corporation's
operations, plans, estimates, expectations, forecasts, objectives,
predictions and projections of the future. Generally, these
forward-looking statements can be identified by the forward-looking
terminology such as 'plans', 'expects' or 'does not expect', 'is
expected', 'budget', 'scheduled', 'estimates', 'projects', 'intends',
'anticipates', or 'does not anticipate', or 'believes', or 'variations
of such words and phrases or state that certain actions, events or
results 'may', 'can', 'could', 'would', 'might', or 'will' be taken',
'occur' or 'be achieved'. Forward-looking statements are subject to
known and unknown risks, uncertainties and other factors that may cause
the actual results, level of activity, performance or achievements of
Scorpio Mining Corporation to be materially different from those
expressed or implied by such forward-looking statements, including but
not limited to: risks related to the exploration and development and
operation of the Corporation's projects in Mexico, risks related to
international operations, construction delays and cost overruns, the
actual results of current exploration, development and construction
activities, conclusions of economic evaluations, changes in project
parameters as plans continue to be refined, future prices of silver,
zinc, copper, lead and gold, risks relating to completing acquisition
transactions as well as those factors discussed in the sections
relating to risk factors of our business filed in Scorpio Mining
Corporation's required securities filings on SEDAR, including its
Annual Information Form dated March 30, 2011. Although Scorpio Mining
Corporation has attempted to identify important factors that could
cause results to differ materially from those contained in
forward-looking statements, there may be other factors that cause
results to be materially different from those anticipated, described,
estimated, assessed or intended.

There can be no assurance that any forward-looking statements will prove
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. Scorpio Mining
Corporation does not undertake to update any forward-looking statements
that are incorporated by reference herein, except in accordance with
applicable securities laws.

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Rich Kaiser, YES International: 1-800-631-8127; 001-757-306-6090 (outside North America)
Email: rkaiser@scorpiomining.com
Website: www.scorpiomining.com