South Crofty mine faces difficult times, however "enthusiasm to progress the mine has not been dented".

The parent company behind South Crofty has served a notice of default on the Canadian firm that has been managing the site.

Management of the South Crofty project has been reassumed by the management of Western United Mines.

The fiirm says that securing investment and planning consents for the South Crofty Mine project has proved difficult since it was originally bought in 2001.

However the South Crofty project has achieved the necessary operational consents required by ROMPS (Review of Mineral Planning Permissions), secured an agreement with the Council over the route of the link road, and the land necessary for the mining operations, including having secured future ventilation sites.

More recently, the surface site and new mine operations consents were approved by Cornwall Council’s strategic planning committee, with the formal surface decision notice issued in November 2011 and the underground notice issued in January 2013.

The latest adverse impact on investment to overcome has been UNESCO’s highly publicised objections to mine operations taking place within Cornwall’s World Heritage Site, nonetheless, the project now has all the permits it needs for its current operations and the most significant ones ultimately required to get into production.

Alan Shoesmith, CEO of Western United Mines, said: “The path towards production has been far from easy. I don’t think any of us who have been working at South Crofty since 2001 could possibly have imagined the huge obstacles we would have to overcome. Regardless of what has happened, however, the fact remains that, as evidenced by the results of all the exploration we’ve been doing, the mine remains an extremely attractive investment.

"I know I speak for all the management team here when I say that our enthusiasm to progress the mine has not been dented. We want to see this project through to fruition and will do all we possibly can to make that happen.

“During the past year, both the economic potential and development methodology for Dolcoath and South Crofty have been more closely defined. Analysis of historical sampling data has identified exploration targets of between 8 and 16 million tonnes of ore at depth at grades between 1.2 and 1.8 per cent tin, in addition to substantial polymetallic resources closer to surface.

"A strategic plan to sequentially dewater Dolcoath and eventually South Crofty has been developed and positively reviewed by an international mining consultancy.”

In light of Celeste’s default, Western United Mines majority shareholders are working closely with South Crofty’s management team to source alternative funding for the project.

“They understand the huge importance of South Crofty’s mineral resource and are doing all they can to help during this difficult period,” added Mr Shoesmith.

Cornish Minerals Limited (“CML” or “the Company”), the parent company of South Crofty Mine operator Western United Mines notes the announcements made by Celeste Mining Corporation on 29 May 2013 and 5th June 2013 and comments as follows:

• On 4th June 2013, CML issued Canada-based Celeste with a notice of default.

The notice has been served as a result of Celeste’s continued failure to fund expenditures relating to the South Crofty project in accordance with contractual obligations set out in the Earn-In agreement of May 2011.

• Celeste has had management control of the South Crofty Mine since November 2011 when the Earn-In Agreement relating to South Crofty became effective.

• On 28th June 2012, Celeste exercised its option under the Earn-In Agreement to earn a further equity stake in Cornish Minerals Limited by further funding the expenditures of the South Crofty project .

• Costs incurred at South Crofty have been steadily reduced since the beginning of the year due to funding not being received from Celeste. As a result, both exploration and development activities have been curtailed instead of advancing in accordance with the project programme.

• With effect from 29 May 2013, Alan Shoesmith is no longer CEO or a director of Celeste; he remains CEO of Western United Mines. In the circumstances and having regard to: the announcement made by Celeste on 29 May 2013, and the prior resignation of David McQuaig (Celeste’s nominated director) from the board of CML and with no current representation of Celeste on the board of either CML or Western United Mines, the management of the South Crofty project has been reassumed by the management of Western United Mines.