Phase II of Gavilanes Drilling Campaign Starts Successfully

Vancouver, B.C. — Santacruz Silver Mining Ltd. (TSX.V:SCZ) is pleased to report the first six holes totaling approximately 1,000 meters of the 16,000 meter Phase II drilling campaign on the 100% owned Gavilanes Silver project in Durango, Mexico. The 7,347 hectare Gavilanes property hosts a low sulphidation epithermal system, where seven high grade silver veins and a stockwork area have been identified to date. The Phase II drill program is designed to test the continuation of three of the seven known silver-bearing veins, each of the veins average 1-kilometer in length, and a stockwork area identified in previous drilling. The drill results reported herein are from the GSA vein, GSA Lower vein and Stockwork area of El Hundido. To date, the GSA vein has been drill tested over a strike length of 500 meters showing clear upside potential for an additional 500 meters of identified strike length which is visible at surface. The stockwork area of El Hundido has been successfully drilled over 250 meters on its identified 500 meters of known strike length to date.

Highlights (reported as true widths and assays uncut) include:

GSA Vein;

• SCHN-12: 4.58 m @ 1,741 g/t Ag eq. (1,687 g/t Ag, 0.15 g/t Au, 1.03% Zn, 0.34% Pb and 0.05% Cu).
  
• SCHN-12: 3.20 m @ 1,064 g/t Ag eq. (1,048 g/t Ag, 0.03 g/t Au, 0.26% Zn, 0.14% Pb, and 0.03% Cu).
  
• SCGP-27: 4.01 m @ 766 g/t Ag eq. (716 g/t Ag, 0.12 g/t Au, 0.51% Zn, 0.67% Pb, and 0.07% Cu ).

The objective of the Phase II program is to confirm the continuation of the GSA, Descubridora and San Nicolas veins at depth and along strike in addition to the stockwork area of El Hundido. Results of the Phase II program together with the 22 holes completed in Phase I plus drilling by historic operators will be compiled into an initial NI 43-101 Resource Estimate.

Arturo Préstamo, President and CEO stated “The start of the Phase II drilling campaign at Gavilanes has been very successful so far. The program is on-going and will be incorporated into a resource estimate we intend to complete prior to year-end 2013. The results continue to show exciting potential at Gavilanes and we believe this trend should continue.”

With respect to production at the Rosario Mine, Arturo Prestamo commented “Operations at the Rosario Mine are on budget since commercial production was achieved on April 1, 2013. The months of April and May have exceeded expectations while silver equivalent production in June is ramping up well. Santacruz continues to have a strong balance sheet and in light of the current market conditions is taking initiatives to bring down our budgeted expenditures without diverging from our exploration objectives. At current silver prices, the Rosario Mine is on pace to generate the necessary cash flow in 2013 to allow us to move closer to our goal of becoming a mid-tier silver producer.”

Complete results of the Phase I drilling campaign in 2012 and the 6 drill holes announced in this press release are described on the Company’s webpage (www.santacruzsilver.com).

Description of first 6 drill results on Phase II drill campaign are:

VEIN	DDH	From	To	Length mts.	True Width mts.	Au	Ag	Cu	Pb	Zn	AgEq g/t
						g/t		%
GSA	SCGP-11	115.80	116.70	0.90	0.77	0.00	24	0.00	0.05	0.0905	28.51
	SCGP-11	116.70	116.95	0.25	0.21	0.00	1055	0.03	3.24	1.665	1202.58
	SCGP-11	116.95	118.05	1.10	0.94	0.00	85	0.00	0.14	0.334	98.93
			Total	2.25	1.92	0.00	167	0.01	0.45	0.38	191.40
GSA	SCGP-25	79.80	80.90	1.10	1.04	0.25	332	0.15	1.54	5.30	558.17
			Total	1.10	1.04	0.25	332	0.15	1.54	5.30	558.17
GSA	SCGP-26	107.25	107.75	0.50	0.48	0.09	197	0.11	0.72	0.60	252.23
	SCGP-26	107.75	108.45	0.70	0.67	0.26	132	0.24	2.60	4.98	391.90
	SCGP-26	108.45	109.00	0.55	0.53	0.01	28	0.03	0.49	0.61	63.92
	SCGP-26	109.00	109.40	0.40	0.38	0.01	5	0.01	0.23	0.33	23.31
	SCGP-26	109.40	109.65	0.25	0.24	0.23	322	0.22	14.30	9.15	1046.14
			Total	2.40	2.30	0.12	121	0.12	2.55	2.73	294.54
ST GSA LOWER	SCGP-26	120.60	121.35	0.75	0.74	0.00	241	0.00	0.05	0.09	245.12
	SCGP-26	121.35	121.75	0.40	0.39	0.00	719	0.00	0.55	0.30	743.97
	SCGP-26	121.75	122.45	0.70	0.69	0.00	530	0.00	0.17	0.11	538.31
			Total	1.85	1.82	0.00	453	0.00	0.20	0.14	463.17
GSA	SCGP-27	117.50	118.30	0.80	0.64	0.01	219	0.02	0.27	0.28	237.41
	SCGP-27	118.30	119.30	1.00	0.80	0.06	65	0.06	0.33	0.83	107.95
	SCGP-27	119.30	120.15	0.85	0.68	0.93	514	0.45	9.24	21.90	1511.97
	SCGP-27	120.15	121.20	1.05	0.84	0.67	567	0.22	8.63	16.55	1355.04
			Total	3.70	2.96	0.42	344	0.19	4.72	10.01	812.39
GSA LOWER	SCGP-27	143.85	144.75	0.90	0.73	0.00	136	0.02	0.16	0.16	147.33
	SCGP-27	144.75	146.05	1.30	1.05	0.00	614	0.03	1.23	0.36	664.37
	SCGP-27	146.05	146.85	0.80	0.65	0.10	534	0.19	0.39	0.60	589.58
	SCGP-27	146.85	147.25	0.40	0.32	0.23	3240	0.08	1.61	0.38	3322.47
	SCGP-27	147.25	148.00	0.75	0.61	0.56	844	0.13	0.51	0.99	934.83
	SCGP-27	148.00	148.80	0.80	0.65	0.02	353	0.02	0.31	0.64	383.94
			Total	4.95	4.01	0.12	716	0.07	0.67	0.51	765.93
GSA	SCHN-03	147.45	147.70	0.25	0.24	0.00	10.7	0.00	1.05	2.17	103.17
	SCHN-03	147.70	148.60	0.90	0.87	0.00	44.5	0.01	0.09	0.27	56.19
	SCHN-03	148.60	149.00	0.40	0.39	0.01	100	0.08	1.33	3.40	244.48
			Total	1.55	1.50	0.00	53	0.03	0.56	1.38	112.36

VEIN	DDH	From	To	Length mts.	True Width mts.	Au	Ag	Cu	Pb	Zn	AgEq g/t
						g/t		%
ST EL HUNDIDO	SCHN-12	61.65	62.05	0.40	0.24	0.23	105	0.03	0.06	0.12	127.66
	SCHN-12	62.05	62.65	0.60	0.36	0.01	727	0.04	0.18	0.27	744.50
	SCHN-12	62.65	63.55	0.90	0.55	0.01	15	0.03	0.05	0.14	24.56
	SCHN-12	63.55	64.50	0.95	0.58	0.02	128	0.06	0.07	0.11	141.18
	SCHN-12	64.50	65.40	0.90	0.55	0.02	544	0.03	0.18	0.15	558.29
	SCHN-12	65.40	66.10	0.70	0.42	0.00	997	0.02	0.26	0.17	1011.93
	SCHN-12	66.10	66.45	0.35	0.21	0.05	4090	0.04	0.23	0.13	4108.44
	SCHN-12	66.45	67.10	0.65	0.39	0.01	26	0.07	0.54	0.52	64.18
	SCHN-12	67.10	68.00	0.90	0.55	0.02	145	0.11	2.10	1.32	257.87
	SCHN-12	68.00	68.60	0.60	0.36	0.08	227	0.56	0.84	0.71	338.48
	SCHN-12	68.60	69.80	1.20	0.73	0.01	75	0.01	0.23	0.12	87.31
	SCHN-12	69.80	70.85	1.05	0.64	0.00	11	0.00	0.02	0.04	13.10
	SCHN-12	70.85	71.95	1.10	0.67	0.00	19	0.01	0.03	0.15	26.01
	SCHN-12	71.95	72.45	0.50	0.30	0.06	405	0.25	0.58	1.05	482.54
	SCHN-12	72.45	73.60	1.15	0.70	0.00	36	0.00	0.03	0.06	39.22
			Total	11.95	7.25	0.02	325	0.07	0.34	0.30	352.56
ST EL HUNDIDO	SCHN-12	77.75	79.10	1.35	0.82	0.01	1485	0.01	0.05	0.12	1492.41
	SCHN-12	79.10	79.80	0.70	0.42	0.02	2040	0.01	0.05	0.15	2048.57
	SCHN-12	79.80	80.80	1.00	0.61	0.26	7520	0.15	0.43	1.80	7615.83
	SCHN-12	80.80	81.95	1.15	0.70	0.43	984	0.12	1.31	3.74	1168.32
	SCHN-12	81.95	82.75	0.80	0.49	0.39	551	0.03	0.34	0.72	608.41
	SCHN-12	82.75	83.45	0.70	0.42	0.03	142	0.01	0.05	0.14	150.29
	SCHN-12	83.45	84.40	0.95	0.58	0.02	55	0.02	0.10	0.41	73.03
	SCHN-12	84.40	85.30	0.90	0.55	0.02	67	0.01	0.13	0.37	83.66
			Total	7.55	4.58	0.15	1687	0.05	0.34	1.03	1741.03
SAN NICOLAS	SCHN-12	108.25	109.25	1.00	0.61	0.00	64.4	0.00	0.01	0.02	65.51
	SCHN-12	109.25	110.30	1.05	0.64	0.00	200	0.07	0.18	0.07	214.94
	SCHN-12	110.30	111.10	0.80	0.49	0.01	70	0.01	0.14	0.61	92.06
	SCHN-12	111.10	112.35	1.25	0.76	0.10	3970	0.04	0.16	0.45	3998.35
	SCHN-12	112.35	113.50	1.15	0.70	0.02	181	0.01	0.19	0.19	194.17
			Total	5.25	3.20	0.03	1048	0.03	0.14	0.26	1064.02

Metal	Symbol	Grade Units	Price	Price Units	Price Symbol
Gold	Au	g/t	1,413.5	$/t Oz	Pau
Silver	Ag	g/t	23.01	$/t Oz	Pag
Cooper	Cu	%	3.7061	$/t lb	Pcu
Lead	Pb	%	1.0086	$/t lb	Ppb
Zinc	Zn	%	0.9395	$/t lb	Pzn

Diamond Drill Holes Location

DDH ID	UTM Collar Coordinates			Strike	Dip	Total
	North	East	Elevation			Length (mts)
SCGP-11	2,678,508.00	425,661.00	2141.00	N 85° E	– 75°	163.25
SCGP-25	2,678,508.00	425,661.00	2141.00	N 78° E	-41.10°	130.60
SCGP-26	2,678,408.00	425,638.00	2145.00	N 37.47° E	-43.30°	149.20
SCGP-27	2,678,408.00	425,638.00	2145.00	N 76.58° E	-70.90°	161.05
SCHN-03	2,678,330.00	425,607.00	2150.00	N 82.28° E	-43.00°	191.10
SCHN-12	2,678,330.00	425,607.00	2150.00	N 82.98° E	-74.02°	231.30

Drilling is ongoing and results will be reported as assays are received from the laboratory.

Sampling and Laboratory

NQ-sized drill core was sawn in half at site and sent to ALS Chemex, a fully accredited and certified laboratory service. Samples were prepared at the ALS Chemex facility in Zacatecas, Mexico, and were assayed at ALS Chemex in Vancouver, Canada. All samples were analysed using a one assay ton fire assay with an AA finish Au and Ag (Au-AA23) and a 48 element ICP method for Pb, Zn and other elements (ME-MS61). A comprehensive QA/QC procedure is followed using standards, blanks and duplicates, all samples are randomly placed.

Qualified Person

Donald E. Hulse P.E., SME-RM of Gustavson Associates LLC, is a qualified person under NI 43-101 and is independent of the Company, and has reviewed and approved the technical information contained in this press release.

Data Verification

Mr. Hulse verified the data disclosed in this release, including the sampling, analytical and test data underlying the information contained in this release. Verification included a review and validation of the applicable assay databases and reviews of assay certificates.

About Santacruz Silver Mining Ltd.

Santacruz is a Mexican focused silver company with a producing project (Rosario) and two advanced-stage exploration projects (San Felipe and Gavilanes). The Company is managed by a technical team of professionals with proven track records in developing, operating and discovering silver mines in Mexico. Our corporate objective is to become a mid-tier silver producer.

‘signed’

Arturo Prestamo Elizondo,
President, Chief Executive Officer and Director

For further information please contact:

Neil MacRae
Santacruz Silver Mining Ltd.
Email: [email protected]
Telephone: (604) 569-1609

Neither the 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.

Forward looking information

Certain statements contained in this news release, such as potential mineralization on the Company’s properties, the Company’s exploration and development plans and anticipated production dates on the Company’s mineral properties, constitute “forward-looking information” as such term is used in applicable Canadian securities laws. Forward-looking information is based on plans, expectations and estimates of management at the date the information is provided and is subject to certain factors and assumptions, including, that the Company’s financial condition and development plans do not change as a result of unforeseen events, that the Company obtains regulatory approval, future metal prices and the demand and market outlook for metals. Forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking information. Factors that could cause the forward-looking information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to prove not to be valid or reliable, that occurrences such as those referred to above are realized and result in delays, or cessation in planned work, that the Company’s financial condition and development plans change, delays in regulatory approval, risks associated with the interpretation of data, the geology, grade and continuity of mineral deposits, the possibility that results will not be consistent with the Company’s expectations, as well as the other risks and uncertainties applicable to mineral exploration and development activities and to the Company as set forth in the Company’s Annual Information Form filed under the Company’s profile at www.sedar.com The Company undertakes no obligation to update these forward-looking statements, other than as required by applicable law.