VANCOUVER, B.C., December 3, 2012 – Catalyst Copper Corp. (“Catalyst” or “the Company”) announces positive results from the La Verde project NI 43-101 Technical Report; including a Preliminary Economic Assessment Study (“PEA”) completed by AMC Mining Consultants (Canada) Ltd. and effective December 2012.  The Technical Report is based in part on a preceding document entitled “Technical Report and Resource Estimate of the La Verde Copper Project, Mexico”, by Margaret Harder, M.Sc., P.Geo.  and Michael F. O’Brien, M.Sc., PrSci. Nat., GSSA, FAusIMM, FSAAIMM, both Qualified Persons, of Tetra Tech Inc., dated 19 September 2012.

Summary highlights of the PEA and 20 year mine plan include:

·         LOM – Life of Mine

·         M – Millions

·         Mt- Millions of tonnes

·         Mlbs– Millions of pounds

·         Mta– Millkions of tonnes per year

*all calculations are to a 100% interest in the La Verde project (and after deducting a 0.5% NSR royalty). The La Verde Project PEA includes analysis at various metal prices. Base case metal prices utilized for preparation of the  Mine Plan, and in the above table, were Cu $2.70/lb; Au $1200/ounce (“oz”); Ag  $25/oz. Financial estimates are earnings before income tax, depreciation and amortization allowances (“EBITDA”) and all dollars are $US.

The PEA is preliminary in nature and includes the scheduling of Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Measured or Indicated Resources. There is no certainty that the results of the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated viability.

Investors are cautioned that the La Verde project is at an early stage of development and no feasibility study has yet been undertaken.  Further drilling, metallurgical studies (including pilot plant and arsenic concentrations in concentrate studies) and geological mapping and investigations; including modelling of alteration mineralogy, sulphide mineralogy, and structure to constrain the resource model, will be required to enhance the confidence level in the property’s resources. Significant risks to the potential development and success of the project remain; including, but not limited to, the ability of the Company to acquire water and surface rights, adequate waste and tailings storage areas, environmental permitting and the “social licence” from the effected local communities to explore, develop and operate the project.

The La Verde PEA mine plan is envisioned as a conventional truck and shovel open pit mining operation, based on an average yearly mining rate of 102 million tonnes (mill feed plus lower grade stockpiled ore plus waste). The load and haul mining fleet will be composed of two 36m³  bucket rope shovels, two 36m³  bucket hydraulic shovel and nineteen 225 tonne haul trucks (LOM avg).The LOM average strip ratio is 2.3.

The proposed metallurgical plant is a conventional copper concentrator comprising crushing, grinding (SAG, ball mill, pebble crusher) and flotation with concentrate regrind and three stages of cleaning. Metallurgical recoveries from sulphide mineralization to concentrate, based on test work to date, are:

Oxide or mixed oxide sulphide material in the East Hill deposit demonstrated recoveries of approximately 50% and is sent to low grade stockpiles for recovery in later years. The West Hill deposit oxide cap is not economic and therefore treated as waste.

Total mine life is expected to span approximately 21 years at a target plant throughput rate of 30 Mtpa with a total of 587 Mt of mineralized rock delivered to the plant. Copper concentrate production is estimated to average 358 thousand tonnes per year grading 26.7% Cu.   

Net smelter return (NSR) calculations were undertaken on all mining blocks by taking into consideration Base Case metal prices for copper, silver and gold, smelter costs, transport costs and refining costs as well as arsenic-related penalties. The NSR values were used in the life of mine schedule to optimize the value of the project. The life of mine plan presented in the PEA was based on optimising the overall value for the project by using a variable NSR cut-off grade by period and selectively stockpiling lower grade material after meeting processing plant requirements of 30 Mtpa and maximum mining fleet capacity of 120 Mtpa. Stockpiled lower grade material is reclaimed at the most opportune time throughout the mine life to complement mill feed ore sourced directly from the open pits.

Table 2 provides a profile of mill feed grades, concentrate produced and contained metal in concentrate over the mine life.

Table 2

The PEA assumes the installation of a roaster to effectively treat the copper concentrates thereby reducing arsenic levels in the concentrates to acceptable levels for any smelter (0.1 to 0.3% arsenic, well below the 0.5% threshold for arsenic content in copper concentrates).  The arsenic content in the copper concentrate remains a concern; especially in the East Hill sulphides where the arsenic is present as a copper-arsenic sulphosalt (tennantite).  Metallurgical testwork carried out to date is preliminary in nature and the Company recognizes further work is required including variability testwork to investigate varying metallurgical response associated with the deposit’s various lithological and alteration types. Preliminary copper concentrate testing has shown roasting as an effective method of reducing arsenic levels, nevertheless the Company is committed to investigating other potential downstream treatment options for the concentrate to remove or reduce arsenic levels.

Services such as power, water and supplies essential to the La Verde project are in close proximity of the site. Excellent road and rail access to the port of Lazaro Cardenas are within a few kilometers of the site.

The tailings management facility (TMF) required is significant and while initial storage areas have been identified in the surrounding valleys, further work is required to investigate permitting issues and to optimize the locations. Other potential TMF sites are also being investigated.

Estimated pre-production (ie prior to the commencement of operation of the processing plant) capital costs of $ 1,160 million are recovered  (assuming Base case metal prices) within three years of the start of concentrate production.

Net present values and internal rates of return based on various metal prices; including the base case (Case A), three year trailing average prices for metals in accordance with SEC guidelines (Case B) and $3.00 copper (Case C) are set out below:

1.       Case A. Cu $2.70/lb., Au $1200/oz; Ag $25/oz

2.       Case B.Cu $3.64/lb; Au $1455/oz; Ag $28.06oz. In accordance with United States Securities and Exchange Commission Guidelines – Three year trailing averages for metal prices, as of November, 2012

3.       Case C. Cu $3.00/lb; Au$1200/oz; Ag $25/oz

The PEA indicates that La Verde is a potentially attractive mining opportunity.  The key financial indicators, based on reasonable future copper prices and capital and operational cost estimates, justify advancing the Project to a Pre-Feasibility study stage.

The key areas proposed to be addressed in moving the Project forward are:

·         Management of high arsenic grades, both from economic and environmental perspectives.

·         Availability of reliable and convenient power; grid power is within 5 kilometers of the plant site but capacity needs to be confirmed.

·         Identification of tailings management facilities for Life of Mine.

·         Continued development of good relationships with local stakeholders.

·         Initiation of environmental and social baseline studies.

·         In the next mine planning exercise, investigate options to deplete West Hill pit earlier to provide an opportunity for backfilling the pit with tailings or waste material.

·         Initiate a program investigating the geo-metallurgical variability across the deposits to develop a geo-metallurgical map and appropriate geo-metallurgical domains.

·         Investigate options to improve precious metals recovery, especially gold in West Hill sulphides.

With respect to pit walls planning:

·         Undertake a geotechnical drilling program using orientated, NQ3 or HQ3-sized diamond drill core.

·         Develop a geotechnical and structural model at pit scale to help with the modelling of the pit wall stability.

·         Conduct a hydrogeological study to assess the presence, nature, and depth of the water table and how this may be affected by mining.

·         Undertake an assessment of the rock mass strength and carry out a slope stability analysis at bench, inter-ramp and overall scale, to assess the slope parameters for each pit.

T.W. Hodson, P.Geo. who is the qualified person for the purposes of National Instrument 43-101 Standards of Disclosure for Mineral Properties of the Canadian Securities Administrators, has reviewed and accepts responsibility for the information contained in this news release.

About La Verde

La Verde is located in an area with excellent infrastructure. Power, rail and water all cross the property. Lazaro Cardenas, Mexico’s third largest port on the Pacific Ocean is 180 km from the site. Significant upside potential remains for the two known zones of porphyry style copper, gold and molybdenum mineralization as the 2012 drill program has shown both deposits remain open to depth and along strike.

La Verde property is subject to an option agreement with a Mexican subsidiary of Teck Resources Limited (Teck) whereby Catalyst’s 100% Mexican subsidiary, Minera Hill 29, may earn a 60% interest in La Verde by making US$10,000,000 in exploration expenditures (including 30,000 meters of drilling and 200 kilometers of IP) by December 31, 2012. Upon Catalyst earning a 60% interest, Teck has the option to increase its interest to 60% by incurring aggregate expenditures equal to two times the amount spent by Catalyst. Should Teck fail to exercise its option to earn a 60% interest, Catalyst can acquire a 100% interest in La Verde by paying to Teck US$20 million. The property is subject to an underlying 0.5% NSR Royalty.

ON BEHALF OF THE BOARD OF DIRECTORS OF
CATALYST COPPER CORP.

“Terence W. Hodson, P.Geo.“

TERENCE HODSON, V.P. EXPLORATION

For further information please contact Corporate Communications Officer: Denby Greenslade (604) 638-5900.

Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of the Company, including, but not limited to, risks associated with mineral exploration and mining activities, the impact of general economic conditions, industry conditions, dependence upon regulatory approvals, and the uncertainty of obtaining additional financing. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. 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.

Quality Assurance: The Company employs a system of quality control for drill results which includes the use of blanks, certified reference materials (standards) and check assaying. Core is logged on site and split with a diamond saw. Samples are shipped to Acme Analytical Laboratories Ltd. for analysis. All elements with the exception of gold are analyzed by Aqua Regia digestion and ICP-ES analysis. Gold is analyzed by fire assay method.