Anaconda's Pine Cove gold mine posts another record quarter; mill recovery improves to 80%

TORONTO, Sept. 14, 2011 /CNW/ --
TORONTO, Sept. 14, 2011 /CNW/ - Anaconda Mining Inc. ('Anaconda' or 'the
Company') - (TSX: ANX) is pleased to announce that the Pine Cove mine
has had its fifth consecutive quarter of record gold sales since
restarting production in the summer of 2010, following the expansion of
its mill. During the fiscal first quarter 2012 ended August 31, 2011,
the Company sold 2,858 ounces and generated $4,519,358 at an average
sales price of $1,581. The sales volume and revenue were an increase of
21% and 32%, respectively, over the previous quarter (fiscal fourth
quarter 2011 ended May 31, 2011). The following table illustrates the
quarterly growth in sales volume and revenue since the beginning of
fiscal 2011.

 ___________________________________________________________________
|             |FY Q1 '11| FY Q2 '11| FY Q3 '11| FY Q4 '11| FY Q1 '12|
|_____________|_________|__________|__________|__________|__________|
|Sales volume |      391|       931|     1,659|     2,363|     2,858|
|(troy oz.)   |         |          |          |          |          |
|_____________|_________|__________|__________|__________|__________|
|Quarterly    |       --|      138%|       78%|       42%|       21%|
|growth       |         |          |          |          |          |
|_____________|_________|__________|__________|__________|__________|
|             |         |          |          |          |          |
|_____________|_________|__________|__________|__________|__________|
|Revenue      | $496,961|$1,136,081|$2,276,989|$3,415,052|$4,519,358|
|_____________|_________|__________|__________|__________|__________|
|Quarterly    |       --|      129%|      100%|       50%|       32%|
|growth       |         |          |          |          |          |
|_____________|_________|__________|__________|__________|__________|
|Revenue per  |   $1,270|    $1,220|    $1,373|    $1,445|    $1,581|
|ounce        |         |          |          |          |          |
|_____________|_________|__________|__________|__________|__________|

President and CEO, Dustin Angelo, stated, 'The Pine Cove mine continues
to show improvement as demonstrated by the quarterly growth in sales
volume and revenue.  The new drum filters have been shipped and are
expected to be installed in the next 10 to 14 days. Additional
modifications, including a fourth leach tank and relining the ball
mill, will take place during this same shut-down period. Following
these modifications to the processing plant, we look forward to having
greater mechanical availability and consistently better recovery rates.
In turn, we would expect to see higher gold output and reduced
operating costs coincident with improvements in the gold grade being
mined from the open pit. We expect to provide complete financial
results for the quarter ended August 31(st) in the second half of October.'

FY Q1 2012 Mill Operations Overview:

Mill recoveries were on the rise during the first quarter of fiscal
2012, increasing from 74% in June to 80% in August.  Improvements were
seen in the flotation, drum filtration and Merrill-Crowe circuits. The
following table summarizes the key operating statistics by month for
the first quarter of fiscal 2012 ended August 31, 2011.

 ________________________________________________________________
|                            |June '11|July '11|Aug '11|Total/Avg|
|____________________________|________|________|_______|_________|
|OPERATING STATISTICS:       |        |        |       |         |
|____________________________|________|________|_______|_________|
|Calendar days               |      30|      31|     31|       92|
|____________________________|________|________|_______|_________|
|Operating days              |      28|      29|     26|       83|
|____________________________|________|________|_______|_________|
|Availability                |     94%|     98%|    84%|      92%|
|____________________________|________|________|_______|_________|
|Dry tonnes processed        |  27,650|  29,805| 22,480|   79,935|
|____________________________|________|________|_______|_________|
|Tonnes per 24-hour day      |     980|   1,046|    864|      963|
|____________________________|________|________|_______|_________|
|Grade (grams per tonne)     |    1.30|    1.52|   1.74|     1.51|
|____________________________|________|________|_______|_________|
|Overall mill recovery       |     74%|     75%|    80%|      76%|
|____________________________|________|________|_______|_________|
|                            |        |        |       |         |
|____________________________|________|________|_______|_________|
|Gold sales volume (troy oz.)|     802|   1,075|    981|    2,858|
|____________________________|________|________|_______|_________|

There were two, primary factors that contributed to the increase in
flotation recovery during the quarter. First, Pine Cove acquired and
implemented the use of an XRF analyzer, which enables the operators to
better control concentrate production by giving them a measured value
to guide them in the operation of the flotation circuit. Second, a
number of diaphragm type reagent metering pumps were replaced by
peristaltic metering pumps, allowing for more consistency in reagent
flow rates.  These changes have resulted in an approximately 2%
recovery increase in the flotation circuit.

A considerable amount of maintenance was performed around the existing
drum filters during the first fiscal quarter.  The valve heads and drum
decks were repaired to prevent the short circuiting of air and vacuum
around the filters.  In addition, both filter blankets were replaced. 
Although the drum filters are scheduled for replacement in the near
future, the extra maintenance on the existing drums helped increase
recovery by approximately 3% for this particular part of the circuit. 
Replacement drum filters are en route at this time.

During the early part of the first fiscal quarter, Merrill-Crowe circuit
recoveries were lower than anticipated due to a number of deficiencies
that were identified and, subsequently, rectified.  The primary issue
that was resolved was the relocation of one reagent addition point. 
Since that time, the Merrill-Crowe system has been operating in the 99%
recovery range, up from 97% in the month of June.

To maximize recovery, operations suspended grinding/flotation during
periods when either of the two drum filters were undergoing maintenance
and repairs rather than operating in single stage. Although impacting
throughput, there was a direct improvement in recovery. During the
month of August, approximately 55% of the downtime (approximately 2.5
days) was directly related to drum filter limitation. The balance of
the downtime was mostly related to long-term improvements such as
relocating a reclaim water pump to the polishing pond. This new feed
source is expected to provide cleaner process water that will aid all
requirements in the plant and limit wear on pumps and related
equipment.

ABOUT ANACONDA

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

FORWARD LOOKING STATEMENTS

This document contains or refers to forward-looking information. Such
forward-looking information includes, among other things, statements
regarding 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 final approval of the private
placement 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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Company website: www.anacondamining.com