Timmins Gold Corp. (the "Company") announces a non-brokered private placement offering of $10 million. The private placement will consist of units at a price of $0.50 per unit. Each unit will consist of one common share and one half share purchase warrant. Each whole warrant will entitle the holder to purchase one common share at an exercise price of $0.75 for a period of one year from closing of the private placement. Finder's fees will be payable in accordance with the policies of the TSX Venture Exchange. The proceeds from the private placement will be used towards completion of the construction of the Company's wholly owned San Francisco Gold Mine in Sonora, Mexico and for general working capital.
Timmins Gold also announces that it has retained the services of CPM Group of New York to act as the Company's financial advisor to review and advise on non-equity offers received by the Company for the working capital requirements for operations at the San Francisco Mine.
At the San Francisco Gold Mine, construction of the new state of the art crushing system is scheduled to be completed within 60 days. The reclaim tunnel is in place, the ore feeders are being installed in the tunnel and the crushers have now been installed. The primary crusher was fully refurbished before installation. The new Sandvik secondary crushers have been designed and calibrated for the rock type and capacity of the mine to maximize throughput and minimize down-time. The crushing circuit will have sufficient capacity to crush 3,500,000 tonnes of ore each year, which will support planned production of 80,000 ounces of gold each year. The current mine life is five years and the 42,000 hectare land package comprising the project has displayed excellent exploration potential. The crushing circuit has been designed for future expansion of capacity with minimal additional cost.
The gold extraction plant has been refurbished and is currently being wet tested. The earthworks for the new heap leach pads are proceeding towards completion. The assay lab has been operational for 12 months and has been processing samples from drilling activity in support of planning for expansion of the existing open pit.
The San Francisco gold mine is located along the main Pan American Highway approximately 150 km north of Hermosillo, in the State of Sonora, Mexico. It is a past-producing open pit, heap leach operation, previously having a capacity of 80,000 ounces of gold per year. The project is described in a preliminary feasibility study dated March 31, 2008 and revised on January 13, 2009, prepared by Micon International Limited. Please refer to the Company's website at www.timminsgold.com to view recent pictures of the progress of construction at the mine.
Timmins Gold has also recently announced encouraging drill results from its Tequila and Cocula gold projects in Mexico. In addition, Timmins Gold has a 100% interest in 45,000 hectares of claims contiguous to Goldcorp's Penasquito mine in Zacatecas, Mexico.
About CPM Group - CPM Group, based in New York, is a research and financial advisory firm focused on commodities with a particular expertise in precious metals. CPM Group's Investment Banking Division, managed by Doug Sherrod, provides strategic financial advisory services to mining and energy companies, including work related to structuring overall financial plans for development stage companies and producers, advising on suitable sources of debt and equity financing, and assisting in arranging financing. The firm has been operating in these markets for more than twenty years. Further information about CPM Group is available on their website www.cpmgroup.com.
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For further information, contact:
Bruce Bragagnolo, LLB.,
Chief Executive Officer
Vancouver, BC, Canada
Tel: (604) 638-8980
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