ALBUQUERQUE, N.M.--(BUSINESS WIRE)--Santa Fe Gold Corporation (OTCBB: SFEG) today reported it is gearing up for full production of 400 tons per day later this year at its Summit silver-gold mine in southwestern New Mexico. Output at full production is expected to increase by 400% from current levels. Once full production is reached, annual revenues are anticipated to approximate $40 million at recent gold and silver prices. Operating costs are projected to be $364 per ounce of gold equivalent produced. Ore reserve grades over the life of mine are estimated to average 10.78 ounces per ton silver and 0.143 ounces per ton gold. “We believe this will enable production to be doubled to 800 tons per day and possibly greater. This will further increase production levels to take advantage of the favorable price environment.” “Management is committed to maximizing production at the Summit operation,” said Dr. Pierce Carson, President and Chief Executive Officer. “We are preparing to begin high volume mechanized mining and are nearing completion of four sublevel drifts in the vein deposit as part of the pre-development required. We also have applied for and in August expect to receive a permit that will allow us to generate additional necessary power. In addition, we have purchased specialized drills and other equipment. We intend to begin mechanized operations as soon as possible.” Dr. Carson continued, “In line with the ramp up, earlier this month we increased operations at the Lordsburg mill to two 8-hour shifts, five days a week. The Summit underground mine has continued to operate two 10-hour shifts a day, seven days a week. We have added to our operating staff and instituted an aggressive training program with a strong emphasis on safety. Currently our work force totals 56, the majority employed at the mine and the mill.” Santa Fe has established a schedule of regular monthly shipments of concentrates to the Aurubis smelter in Germany and silica flux to the Asarco smelter in Arizona. When production increases, the company plans to expand its customer base and also sell its products to other smelters. Both the concentrates and silica flux are premium quality products and Santa Fe anticipates no problem in selling all it can produce. “Looking to the future, our flotation mill has extra capacity and an important priority will be to acquire additional precious metal assets for processing through the mill,” Dr. Carson said. “We believe this will enable production to be doubled to 800 tons per day and possibly greater. This will further increase production levels to take advantage of the favorable price environment.” About Santa Fe Gold: Santa Fe Gold is a U.S.-based mining and exploration enterprise focused on acquiring and developing gold, silver, copper and industrial mineral properties. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began processing operations in 2010; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Ortiz gold property in north-central New Mexico; (iv) the Black Canyon mica deposit and processing equipment near Phoenix, Arizona; and (v) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals. To learn more about Santa Fe Gold, visit www.santafegoldcorp.com.

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