SOURCE: Lone Star Gold, Inc.

March 05, 2012 08:30 ET

Lone Star Gold, Inc. Plans to Construct On-Site Wash Plant to Increase Profitability and Load Value of Tailings Project Shipments

ALBUQUERQUE, NM--(Marketwire - Mar 5, 2012) - Lone Star Gold, Inc. (OTCBB: LSTG) ("Lone Star" or "the Company") is pleased to announce the Company has decided to construct a basic wash plant and jig circuit on the San Antonio del Potrero mine tailings project ("Tailings Project") property, which is located near the city of Hidalgo Del Parral in the state of Chihuahua, Mexico. The option to build an on-site wash plant was chosen after evaluating several scenarios intended to create the most efficient system for processing the Tailings Project's 1.2 million tons of mine tailings.

The wash plant's simple processing circuit, which is currently being designed for a capacity of up to 30 tons per hour, will separate the heavy mineral-rich material from the lighter worthless material in the tailings. Based on an 8-hour-per-day wash cycle, the plant will process 240 tons daily, thereby creating approximately 100 tons of tailings concentrate.

To date, comparable test runs have more than doubled the assay results for the project's tailings. The Company expects its trucking costs to be reduced by 50% due to shipping a higher base metal concentrate. In addition, processing plant costs will also be reduced due to less overall tailings needing to be processed. The combined result will be a significant increase in the price per ton being shipped.

The Company expects construction of the wash plant to take between 6 to 8 weeks including a concrete base, with multiple reservoirs to recycle water, a grizzly feeder, conveyor system and a jig (i.e., an apparatus that separates the tailings by agitation in water). The Company has identified a local fabricator and construction crews along with local sources for all of the necessary heavy equipment, most of which has already been sourced.

Lone Star Gold's Company President, Daniel Ferris, commented: "This basic wash plant is designed to make Lone Star more profitable by lowering our transportation and processing costs while increasing the value by weight that we ship out. And by sourcing local service providers and low-cost equipment, we expect to recoup our investment in a couple of months."

Lone Star has an undivided 65% interest in the Tailings Project.

Cautionary Note to U.S. Investors -- The United States Securities and Exchange Commission permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We may use certain terms in this press release, such as "measured," "indicated," and "inferred" "resources," which the SEC guidelines strictly prohibit U.S. registered companies from including in their filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 10-K which may be secured from us, or from our website at http://www.sec.gov/edgar.shtml.

ADDITIONAL INFORMATION
To learn more about the Tailings Project, the Company, and regular news updates, visit Lone Star Gold's official website: http://www.lonestargold.com.

ABOUT LONE STAR: Lone Star Gold, Inc. is a publicly traded (OTCBB: LSTG) gold exploration and development company based in Albuquerque, New Mexico. The Company's aggressive acquisition and exploration approach is strategically focused on proven, stable precious metal regions in America and Mexico. Currently, Lone Star has a 70% Working Interest in concessions covering 800 hectares in the La Candelaria project in Chihuahua, Mexico, which the Company is evaluating to determine the potential sites that represent the best potential for silver and gold deposits. Lone Star also has an undivided 65% interest in the San Antonio del Potrero mine tailings project near the city of Hidalgo Del Parral in the state of Chihuahua, Mexico.

ON BEHALF OF THE BOARD OF DIRECTORS,

Lone Star Gold, Inc.
Daniel Ferris, Company President

(OTCBB: LSTG)

This press release contains statements that are forward-looking and which involve a number of risks and uncertainties. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements in question are based on Lone Star Gold, Inc.'s current expectations and projections about future events, based on information currently available. The forward-looking statements found in this press release may also include statements relating to Lone Star Gold, Inc.'s anticipated financial performance, business prospects, new developments, strategies, and similar matters. Lone Star Gold, Inc. provides no assurance regarding the actual outcome of the events contemplated by any forward-looking statements included in this release. Lone Star Gold, Inc. disclaims any obligation to update any of its forward-looking statements, except as may be required by law.

Contact Information

  • Contact:
    Lone Star Gold, Inc.
    6565 Americas Parkway NE, Ste 200
    Albuquerque, New Mexico
    87110
    USA

    INVESTOR RELATIONS
    Toll Free: 1-800-986-9358
    E-mail: ir@lonestargold.com
    Web: www.lonestargold.com