Excellon Resources Reports Third Quarter Financial And Exploration Results

Toronto Stock Exchange - EXN

Highlights

• Third quarter sales: 276,942 oz of silver, 1,519,787 lbs of lead and 2,572,547 lbs of zinc;
• Net cash costs after lead and zinc by-product credits for the three months ended September 30, 2011 were $6.95 per ounce of silver;
• Realized price per ounce of silver $37.18 for the third quarter and year-to-date $37.14;
• Exploration expenses for the quarter totalled $1.6 million for the ongoing program at Platosa with results that continue to be  encouraging;
• The Company's cash and cash equivalents at September 30, 2011 was $15.1 million and working capital was $18.4 million.

TORONTO, Nov. 10, 2011 /PRNewswire/ - Excellon Resources Inc. (TSX: EXN) (the "Company" or "Excellon") is pleased to report nine-month net income for the period ending September 30, 2011 of $7.5 million as compared to a loss of $1.2 million for the same period of 2010. The Company recorded a loss in the third quarter of $1.0 million as compared to a loss of $2.0 million in the third quarter of 2010.  The loss in the current quarter was primarily the result of $3.4 million of unrealized foreign exchange losses attributable to the impact of a strengthening US dollar experienced during late September.  The Company reports its financial results in US dollars and conducts its business in the domestic currencies of Mexico and Canada.

The Company's cash cost per ounce of silver produced for the three-month period ended September 30, 2011 was $6.95 per ounce (three months ended September 30, 2010 - $14.75 per ounce).  For the nine-month period ended September 30, 2011 the cash cost of silver production was $6.65 per ounce compared to $6.61 per ounce for the same period of 2010.  The calculation of cash cost per ounce produced reflects the cost of production adjusted for by-product and various non-operating costs included in Cost of Sales.

All dollar amounts in this news release are disclosed in US dollars.  For full details, please see the Company's Management Discussion & Analysis, which was filed on SEDAR, www.sedar.com on November 10, 2011.

Production
Actual and planned mine production for the third quarter and first nine months of 2011 are as follows:

Mine Improvements
Production and efficiency for the month of October have been significantly improved with mine production an estimated 40% ahead of planned schedule and an extra 2,000 tonnes of ore processed, resulting in a 40% increase in silver production over plan.

Financial and Operating Highlights

Mining Operations

Exploration Update

Mexican Exploration
Diamond drilling continued to encounter success near existing mine infrastructure.  In mid-October 2011, the Company reported results from nine new holes that intersected high-grade massive sulphides over estimated true widths ranging from 0.40 to 3.53 metres ("m"). Several of these holes will assist mine operations in planning ongoing and future development and possibly lead to early development of additional ore. Among the nine holes, hole LP942, off the southeast corner of the Rodilla Manto, intersected 3.53 m of massive sulphides grading 912 g/t (26.6 oz/T) Ag, 8.36% Pb, 12.48% Zn. Hole LP919, on the northern fringe of the high-grade Pierna Manto intersected 142 g/t (4.1 oz/T) Ag, 5.59% Pb, 6.28% Zn over 1.58 m. Intersections are estimated true thicknesses. The assay results for the nine holes are included in a press release dated October 17, 2011.

On October 25, 2011, the Company disclosed an updated Mineral Resource estimate for the Platosa Mine, as summarized in the following table. Taking into account production of 109,000 tonnes since the previous estimate, tonnage has increased by 10% and the high grade has been maintained:

Platosa Project - Summary of July 31, 2011 Mineral Resource Estimate

In a press release dated September 27, 2011, the Company announced the discovery of anomalous REE values in four drill holes located northwest of the Platosa Mine at Cañón Colorado.  Values of Total Rare Earth Element Oxides (TREEO), the manner in which REE content is normally reported, range from 1,308 ppm (0.131%) TREEO over a 36.25 m core width in hole EX06-JVN03 to 2,136 ppm (0.214%) TREEO over a 281.25 m core width in hole EX06-JVN04.  The TREEO amounts are comprised of Cerium, Dysprosium, Lanthanum, Neodymium, Praseodymium, Samarium and Yttrium oxides. Scattered values of other REE oxides have been encountered but were not included in the reported results. Intersections are reported as core widths since not enough is known about the occurrence to estimate true thicknesses. The Company has begun a program of surface mapping, prospecting and sampling, and intends to carry out diamond drilling before year end.

With respect to the Sundance Option, the project operator Sundance Minerals Ltd., commenced the initial diamond drilling program in early July.  The drilling was completed in late September. Nine holes tested surface sulphide showings, soil geochemical and geophysical CRD targets developed by Sundance on the Pluton Property, located north of the historic mining town of Mapimi and immediately west of and contiguous with the original Platosa Property.  Logging and sampling of the drill core is complete, however, only a small number of assays have been received. The Company expects a comprehensive report, including recommendations for further exploration work, before year end.

The Platosa exploration program continues to meet with considerable success. In mid-October the Company reported an updated Mineral Resource estimate for Platosa.  It showed that taking into account the 109,000 tonnes mined since the previous estimate in late 2009, tonnage had increased by 10% and the high grades had been maintained.  In addition, Rare Earth Elements have been discovered at Cañón Colorado and the search for the source of the mantos has resumed.

Canadian Exploration
The Company's Canadian program is focused on two properties, the DeSantis Project in northeastern Ontario and the Beschefer Property in northwestern Quebec. Both are located in the Abitibi Greenstone Belt, one of the most prolific such belts in the world.

The DeSantis Project is located along the Destor-Porcupine Tectonic Zone ("DPZ"), the main structure controlling gold deposits in the Timmins gold camp, approximately 5 km southwest of downtown Timmins, 11 km west of the Dome Mine, currently owned and operated by Goldcorp Inc. and 14 km east of Lake Shore Gold Corp.'s Timmins Mine.  The DeSantis property covers approximately 5 km of strike length within highly prospective volcanic stratigraphy on the north side of the DPZ, including the past producing DeSantis Mine.  Gold deposits in the Timmins gold camp occur in a variety of forms, but virtually all can be related to structural controls associated with major deformation zones, the foremost being the DPZ, thus are mesothermal gold deposits, exhibiting the form of 'shear-zone hosted gold deposits.'  Such gold deposits are typified by wide alteration envelopes hosted within volcanic sequences with a locus of deformation and alteration in discrete zones which also host significant veining including quartz and accessory minerals and gold.

The DeSantis Property hosts at least five known gold-bearing zones, including the Contact Zone, Hydrothermal Zone, Albitite Zone, Arsenopyrite Zone, and East Pit area, all of which are located near the area of historic underground mining on the property.  The DeSantis Mine produced 35,800 ounces of gold from 178,650 tonnes of ore, which graded 6.2 g/t Au during its intermittent production history.  Production was carried out from nine levels sourcing principally the Albitite and Hydrothermal Alteration Zones, accessed via the 379 m-deep DeSantis # 2 Shaft.  The 2011drilling program commenced in June with the objective of expanding known zones and in particular, exploring for potential extensions at depth.

In a news release dated October 18, 2011, the Company announced results from the first 10 holes in exploration drilling directed towards the Hydrothermal Zone.  These results included 1.81 g/t Au over 0.92 m in hole DS11-001, 2.05 g/t Au over 0.90 m in hole DS11-003, and 3.63 g/t Au over 23.17 m including 14.25 g/t Au over 1.17 m in hole DS11-010A.  Several holes had multiple intersections.  DeSantis drilling is now targeting the Albitite Zone.

The Beschefer Property is located within the Abitibi Greenstone Belt approximately 75 km west of Matagami, in northwestern Quebec, 12 km east of the past producing Selbaie Mine.  The Selbaie Mine produced 57.5 million tonnes grading 0.56 g/t Au, 38 g/t Ag, 0.87% Cu, and 1.85% Zn over its mine life.  The property has little or no bedrock exposure and is muskeg covered such that drilling is restricted to the winter and freezing conditions.

The property hosts the "B-14" Zone, a gold mineralized shear zone, hosted within a typical Archean volcanic 'greenstone' assemblage.  As reported in a news release dated May 11, 2011, 1,520 m of diamond drilling in five holes were completed in early 2011, primarily on the B-14 Zone.  Results include 3.80 g/t Au over 4.35 m including 13.85 g/t Au over 0.30 hole m in BE11-001, and 12.4 g/t Au over 3.78 m including 63.5 g/t Au over 0.43 m in hole BE11-003 (all reported gold grades are uncut).  In addition, hole BE11-002 intercepted 2.3% Cu over 2.58 m.  Intersections for both DeSantis and Beschefer are reported as core widths since not enough is known about the nature of the occurrences to estimate true thicknesses.

The Company's early-2011 drilling results confirm that the B-14 Zone has the potential to host a significant gold resource and other portions of the property should be further investigated for gold as well as base metal potential.

An 8,000 metre drill campaign is planned for late 2011 and early 2012 to further assess the B-14 Zone as well as explore other portions of the property.  This campaign is expected to commence in December 2011, contingent on weather conditions allowing access.

Qualified Persons
Mr. John Sullivan, BSc., PGeo., Excellon's Vice President of Exploration for Mexico has acted as the Qualified Person, as defined in NI 43-101, with respect to the disclosure of the scientific and technical information related to Mexico contained in this MD&A and has supervised the preparation of the technical information on which such disclosure is based.

Mr. Sullivan is an economic geologist with over 35 years of experience in the mineral industry.  Prior to joining Excellon in 2007 he was a senior geologist at a Toronto-based international geological and mining engineering consulting firm where he evaluated properties and prepared NI 43-101 reports on gold and base metal projects in Canada and internationally.  In addition he has held senior positions with two large Canadian mining companies where he directed major exploration programs, managed field offices, and evaluated projects in Canada, Europe, Africa and Latin America.  Mr. Sullivan is not independent of Excellon as he is an officer of the Company.

The Company's Canadian exploration programs are conducted under the supervision of its Vice President of Exploration for Canada, Ms. Heather Miree, BSc., PGeo.  Ms. Miree has acted as Qualified Person, as defined by NI 43-101, with respect to the disclosure of the scientific or technical information related to Canada contained in the MD&A and has supervised and verified those portions of the technical activities completed during 2011 on which such disclosure is based and verified technical information related to 2010 exploration activities completed by the Company.

Ms. Miree is an economic geologist with over 25 years of experience in the mineral industry.  Ms. Miree has held senior geological and supervisory roles with several junior and mid-sized mining companies, in the areas of exploration and operations.  During such roles, Ms. Miree conducted exploration programs, completed project evaluations, managed regional exploration offices, was Chief Mine Geologist, and participated in the advancement of projects from exploration to commercial production.  Ms. Miree is not independent of Excellon as she is an officer of the Company.

On behalf of

EXCELLON RESOURCES INC.

"Jeremy Wyeth"
President and Chief Executive Officer

The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this Press Release, which has been prepared by management. This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 27E of the Exchange Act. Such statements include, without limitation, statements regarding the future results of operations, performance and achievements of the Company, including potential property acquisitions, the timing, content, cost and results of proposed work programs, the discovery and delineation of mineral deposits/resources/reserves, geological interpretations, proposed production rates, potential mineral recovery processes and rates, business and financing plans, business trends and future operating revenues. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, significant downward variations in the market price of any minerals produced [particularly silver], the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies. All of the Company's public disclosure filings may be accessed via www.sedar.com and readers are urged to review these materials, including the technical reports filed with respect to the Company's mineral properties, and particularly the January 15, 2010 NI 43-101-compliant technical report prepared by Scott Wilson Roscoe Postle Associates Inc. with respect to the Platosa Property. This press release is not, and is not to be construed in any way as, an offer to buy or sell securities in the United States. 

SOURCE Excellon Resources Inc.