RX Exploration Mining and Milling Operations at Drumlummon Mine Exceeding Expectations

WINNIPEG, Manitoba--()--RX Exploration Inc. (TSX-V: RXE) (OTCQX: RXEXF) (“RX Exploration” or the “Company”) is pleased to announce that test mining and milling operations at the Company’s wholly owned Drumlummon Gold and Silver Mine in Marysville, Montana have been ramped up quickly, safely and efficiently since the recommencement of operations on May 10th 2011.

Trucking of mineralized material to surface through the Gunsinger Decline peaked at 800 tons per day (tpd). This is currently believed to be the upper limit of mining capacity due to the limited equipment presently on site. The Company’s original goal was to achieve a test mining rate of 500 tpd by the end of August this year, (refer to news release dated May 18, 2011). Mineralized vein material is being extracted from the Empire Vein (600 level), Drumlummon Vein (600 level Pixley), Charly Vein (530 and 570 levels) and the Drumlummon Vein (D block and D Block South on 500 level and 400 level).

“We were able to ramp up the test mining and test milling programs at a faster pace than expected, despite limitations on the rate of extraction caused by shortages of company-owned mining equipment” commented Murray Nye, President of RX Exploration. “Achieving this higher rate of extraction, in a shorter time period than planned is a tribute to the caliber of our work-force. The attendant cash flow will enable us to take advantage of the high gold and silver prices presently available.”

Milling Progress

Test milling of Drumlummon vein material at the leased Mill-site in Philipsburg began on May 16 at the rate of 60 tons per day (tpd). This rate was gradually ramped up, and both ball mills were operated simultaneously beginning June 14. Mill throughput peaked at 602 tpd on June 16.

Drumlummon material milled during this May 16 thru June 17 period totaled 4,733 tons averaging 0.199 opt gold (6.82 grams per tonne) and 3.57 opt silver (122.4 grams per tonne). This translates to a 0.282 ounce per ton gold equivalent value (9.67 grams per tonne) based on $1500 per ounce gold and $35 per ounce silver price.

Flotation concentrates weighing 24.5 tons were calculated to contain 277 ounces gold and 9,299 ounces silver. These concentrates were shipped to a refiner in Spokane during the 2nd week of June. In addition, flotation and gravity concentrates weighing 23.1 tons containing a calculated 236 ounces gold and 4,524 ounces silver were shipped to a smelter/broker in Reno during the 3rd week of June.

Inventoried table, flotation and gravity concentrates bring the total for the one month period to 880 ounces of gold and 15,107 ounces of silver (gold equivalent of 1,232 ounces).

Drumlummon Mine vein material varies in terms of hardness and friability from vein to vein, but based on testing thus far, 650 tpd is estimated to be peak throughput at the Philipsburg Mill. Test milling of Drumlummon material was curtailed from June 4 to June 13 to enable the fulfillment of previous obligations to mill material from another source. This milling was conducted by Drumlummon personnel on a cost-plus fee basis.

As of June 21st, low-grade vein material from the Drumlummon Mine is being crushed to -3/4 inch and trucked at a rate of 300 tpd to a buyer operating a large, cyanide CIP mill near Whitehall, MT. Deliveries at this rate have been scheduled to continue on a 5 day per week basis with estimated average grade of 0.08 opt gold (2.74 g/t gold).

“Based on the current success of our test-mining and milling operations, we hope to maintain an average throughput of 800 tpd until we can acquire the necessary equipment to further ramp up operations in an effort to take full advantage of record high gold and silver prices,” stated Mr. Nye.

Detailed sampling and assaying of the exposed faces during the underground development programs combined with actual metal recoveries from the test milling program will provide additional information as to the grades, continuity and metallurgical recoveries of gold and silver values in the vein systems at the Drumlummon Mine. An aggressive underground core drilling program continues with two contracted electric-hydraulic rigs testing the Empire and Charly veins below the 600 level and a company-owned, air powered drill testing the north end of the Drumlummon vein both above and below the 600 level.

Bald Butte Opportunity

RX also announces that preliminary discussions have been initiated with a major North American producer of molybdenum regarding possible joint venturing of the Bald Butte gold/moly property. The Bald Butte property is contiguous to the Drumlummon property and is controlled by the Company. (see NR April 29, 2010).

A resource report authored by Broad Oak Associates which is National Instrument 43-101 compliant was commissioned by a previous operator. The report outlines an indicated resource containing 139,428,000 tons at an average grade of 0.06% Molybdenum (or 168.5 million contained pounds of Molybdenum). This resource was calculated using a block model with standard kriging. The report also outlines an inferred resource of 45,121,000 tons averaging 0.056% Molybdenum (50.6 million contained pounds of Molybdenum). These resources were calculated using a 0.04% molybdenum cut-off grade for both categories. The above contained molybdenum (219.1 million pounds) is the total material contained and does not take into account metallurgical recoveries. Molybdenum currently sells for $16.30 per pound.

L. Joseph Bardswich, P.Eng. (Mining) (Ontario) is the qualified person responsible for reviewing the technical details in this press release for content and accuracy.

About RX Exploration

RX Exploration Inc. is a gold exploration company whose strategy is to re-examine gold and silver projects within North America that have previously reached advanced exploration, underground development or past gold or silver production. The Company is currently focused on re-starting production from its Drumlummon Mine, a past producing high-grade, bonanza-type, epithermal underground gold and silver mine in Montana.

The Company’s shares are listed on TSX-V (Symbol: RXE) and on the OTCQX (Symbol: RXEXF). There are 160,438,980 common shares issued and outstanding.

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.

This news release contains "forward-looking information" (within the meaning of applicable Canadian securities laws) and "forward-looking statements" (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995). Such statements or information are identified with words such as "anticipate", "believe", "expect", "plan", "intend", "potential", "estimate", "propose", "project", "outlook", "foresee" or similar words suggesting future outcomes or statements regarding an outlook. Such statements include, among others, those concerning the Company’s anticipated operational plans and activities including its plans to conduct additional surface and underground diamond drilling.

Such forward-looking information or statements are based on a number of risks, uncertainties and assumptions which may cause actual results or other expectations to differ materially from those anticipated and which may prove to be incorrect. Assumptions have been made regarding, among other things, management's expectations regarding its ability to complete its development work as expected. Actual results could differ materially due to a number of factors, including, without limitation, operational risks in the completion of the Company’s continued development work, technical, safety or regulatory issues.

Although the Company believes that the expectations reflected in the forward-looking information or statements are reasonable, prospective investors in the Company’s securities should not place undue reliance on forward-looking statements because the Company can provide no assurance that such expectations will prove to be correct. Forward-looking information and statements contained in this news release are as of the date of this news release and the Company assumes no obligation to update or revise this forward-looking information and statements except as required by law.

Contacts

RX Exploration Inc.
Murray R. Nye, 204-989-2434
President

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Contacts

RX Exploration Inc.
Murray R. Nye, 204-989-2434
President