Telson Mining Corporation Has a 9.3% Increase in Mill Throughput Production at Campo Morado in Q2, 2018

 

Telson Mining Corporation (“Telson” or the “Company”) (TSX-V – TSN, OTC Pink – SOHFF, Frankfurt – TSGN (formerly SQ82)) is pleased to present the following update for activities at its 100% owned Campo Morado mine:

• Total mill throughput in Q2 of 162.5kt, a 9.3% increase from Q1
• 11.9 kdmt of zinc concentrate in Q2. 45.1% increase from Q1
• 1.9 kdmt of lead concentrate in Q2. 35.7% increase from Q1
• 8.6 kt of zinc in the zinc concentrate. 53.6% increase from Q1
• 0.6 kt of lead in the lead concentrate. 100.0% increase from Q1

Item			Q1			Q2			Increase (%)
Processed tons (kt)			148.7			162.5			9.3%
Zn concentrate (kdmt)			8.2			11.9			45.1%
Pb concentrate (kdmt)			1.4			1.9			35.7%
Zn metal content (kt)			5.6			8.6			53.6%
Pb metal content (kt)			0.3			0.6			100.0%

Since Telson declared commercial production as of May 15, 2018 mining and milling operations at Campo Morado have run smoothly and continuously while production is steadily increasing towards management's targets.

Underground bulk mining methods have commenced and with the delivery of three recently purchased underground low profile 30 tonne dump trucks, which were fully paid for with cash generated from concentrate sales, Telson is increasing mill throughput past its current processing rate of approximately 2,200 tonnes per day. The Company intends to increase production towards 2,500 tonnes per day over the next several weeks and with some planned modifications to the crushing circuit intends to increase mill throughput past 2,500 tonnes per day, hoping to achieve up to 3,000 tonnes per day by year end 2018.

Since commencement of commercial production on May 15, 2018 through to July 30th, 2018 the Campo Morado mill has produced approximately 9,383 tonnes of zinc concentrates and 1,612 tonnes of lead concentrates processing approximately 124,482 tonnes of mineralized material from the El Largo zone. During this period average grades of concentrate produced were; Zinc Concentrate - 44.5% zinc, 410 g/t silver, 1.25 g/t gold and Lead Concentrate – 29% lead, 709 g/t silver, 6.26 g/t gold. Average recoveries achieved were 73.3% zinc, 31.2% lead, 32% silver and 18% gold.

Underground development work during Q2 advanced a total of 1,088 meters, 710 meters (6x5m) in mineralized material and 378 meter (5x5m) of access development in waste rock. This development includes advancing an incline from the El Largo Zone towards the Naranjo Zone, which has progressed to within 20 meters of the Naranjo Zone. When Naranjo has been reached, a portal will be developed at Naranjo to access the surface after which all production from El Largo, Naranjo and Fish Zones will be transported on surface from the new portal reducing haulage time and trucking costs. The Company has also dewatered the Fish Zone, adjacent to the El Largo Zone, and is preparing that zone for production.

Future Plans and Initiatives

Telson is planning several initiatives to improve the mill processing plant’s production and recoveries.

• The first initiative will be to purchase and install Jameson Flotation Cells into the mill process circuit to increase the zinc recovery and increase the zinc concentrate grades. Previous successful testing of Jameson Flotation technology in Campo Morado has demonstrated significant improvements in concentrate grades and metal recoveries.
• The second initiative will demonstrate the viability of Glencore Technology’s Albion Process to potentially increase the recovery of precious metals, (gold and silver). The Company intends to provide Glencore Technology with bulk samples of Campo Morado mineralization for Albion process testing, and with positive results, Telson intends to engage Glencore Technology to initiate technical studies for the design and build of the Albion Process equipment for purchase and installation at the Campo Morado Mine. There are four Albion Process™ plants currently in operation with dramatic increases in precious metal recoveries from refractory ore in all existing Albion Process plants, from previous recovery percentages in the low 20’s using conventional milling to more than 90% in some cases using Albion Process, (please visit the following web link for more information http://www.albionprocess.com/en/Pages/home.aspx) Telson is targeting for Glencore Technologies to complete testing and have design and costing completed by end of 2018. With successful initial testing and design work completed and subject to securing additional construction capital, Telson is targeting late 2019 to complete installation and commence using Glencore’s Albion Process with the intent to markedly increase precious metal recoveries and thereby profitability at Campo Morado. Glencore’s Albion Process has also proven to markedly improve base metal recoveries from several mines currently processing with this new technology which could also benefit production at Campo Morado.

“Management is efficiently implementing many improvements at Campo Morado, both to underground mining and mill processing which are substantially reducing operating costs. Equally important are managements plans to increase base metal recoveries and concentrate grades as well as to potentially significantly increase precious metal recoveries with new technologies,” states Antonio Berlanga, CEO. “Our well-structured improvements that have been and are currently being implemented at the Campo Morado Mine are increasing sales and decreasing operating costs in the short-term, but more importantly if Albion Process Technology testing proves successful, we plan to transform Campo Morado into a predominately precious metal producer in the mid-term.”

About Telson Mining Corporation
Telson Mining Corporation is a Canadian based mining company with two Mexican gold, silver and base metal mining projects.

Telson is currently in production at its 100% owned Campo Morado Mine in Guerrero, Mexico. Telson acquired Campo Morado in June 2017, re-commenced mining and processing operations in October 2017 with pre-production from mine development on a trial basis that commenced at an average 1,400 tonnes per day and declared commercial production as of May 15^th, 2018. Currently the Campo Morado mine is processing approximately 2,200 tonnes per day through the milling facilities.

Telson's Tahuehueto Project, located in north-western Durango State, Mexico is currently in pre-production at approximately 100 tonnes per day utilizing a toll mill for processing, and has entered a construction phase with a timeline to be producing on site in its own mineral processing plant capable of milling at least 1,000 tonnes per day in Q1, 2019. Regular metal concentrate delivery and sales are underway from both projects. Visit: www.telsonmining.com

On behalf of the board of directors

(signed) “Ralph Shearing”

Ralph Shearing, P.Geol., President and Director

Qualified Persons
This press release was prepared under the supervision and review of Ralph Shearing, P.Geol., President and Director of Telson Mining Corporation, a Professional Geologist registered in Alberta as a member of the professional association APEGA, and a Qualified Person as defined by NI 43-101. Data verification by Mr. Shearing includes personal inspection of the Campo Morado mine site, reviewing mining facilities, drill core, underground development and discussing work programs and results with geology and mining personnel.

Cautionary Note Regarding Production Decisions and Forward-Looking Statements
It should be noted that Telson has declared commercial production at Campo Morado prior to completing a feasibility study of mineral reserves demonstrating economic and technical viability. Accordingly, readers should be cautioned that Telson’s production decision has been made without a comprehensive feasibility study of established reserves such that there is greater risk and uncertainty as to future economic results from the Campo Morado mine and a higher technical risk of failure than would be the case if a feasibility study was completed and relied upon to make a production decision. Telson has completed a preliminary economic assessment (“PEA”) mining study on the Campo Morado mine that provides a conceptual life of mine plan and a preliminary economic analysis based on the previously identified mineral resources (see News Release dated November 8, 2017 and April 4,2018). This will soon be replaced by a pre-feasibility study (“PFS”) that will allow the application of modifying factors to the mineral resources to allow a portion of them to be converted to mineral reserves.

Statements contained in this news release that are not historical facts are “forward-looking information” or “forward-looking statements” (collectively, “Forward-Looking Information”) within the meaning of applicable Canadian securities laws. Forward Looking Information includes, but is not limited to, disclosure regarding possible events, conditions or financial performance that is based on assumptions about future economic conditions and courses of action; the timing and costs of future activities on the Company’s properties, such as production rates and increases; success of exploration, development and bulk sample processing activities and timing for processing at its own mineral processing facility on the Tahuehueto project site. In certain cases, Forward-Looking Information can be identified by the use of words and phrases such as “plans”, “expects”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or variations of such words and phrases. In preparing the Forward-Looking Information in this news release, the Company has applied several material assumptions, including, but not limited to, that the current exploration, development, environmental and other objectives concerning the Campo Morado Mine and the Tahuehueto Project can be achieved, the continuity of the price of gold, zinc, lead and other metals, economic and political conditions and operations. Forward-Looking Information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the Forward-Looking Information. There can be no assurance that Forward-Looking Information 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 Information. Except as required by law, the Company does not assume any obligation to release publicly any revisions to Forward-Looking Information contained in this news release to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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