Farallon announces details of evaluation of other deposits at Campo Morado

Contractors to be selected by September 1, 2010

VANCOUVER, July 6 /PRNewswire-FirstCall/ - Farallon Mining Ltd. ("Farallon" or the "Company") (TSX:FAN) announces that the Company has established the framework and timeline for the review of the original four deposits at Campo Morado. The objective of the review is to evaluate the economic viability of building a second mine at Campo Morado.

This study will investigate a number of development alternatives including construction of a new stand-alone mill, expanding the current mill at G-9, blending with ore from G-9, or utilizing campaign milling to extend the life of G-9. The primary focus of the study will be to address the options for maximizing the recovery of precious metals in the Reforma, El Rey, El Largo and Naranjo deposits, since the resource at Campo Morado is estimated to include just under 1 million ounces of gold and 60 million ounces of silver(1) (see June 29, 2010 news release for resource table.)

The scope of work will include:

    -   Metallurgical testwork including "pilot plant" programs in the
        G-9 mill
    -   Flowsheet design
    -   Mine planning
    -   Equipment requirements
    -   Manpower requirements
    -   Capital and operating costs
    -   General Arrangement drawings and engineering design
    -   Construction plans and timetable
    -   Infrastructure requirements

Dr. David Stone, P.Eng., of Hunter Dickinson Services Inc. and a consultant to Farallon, will be the project manager for this study, reporting directly to Farallon's President Mr. Dick Whittington. The project schedule targets the awarding of contracts for the study work by September 1, 2010, with the final study scheduled for completion by July 1, 2011.

Dick Whittington said: "I am very excited to be moving forward with this study. The unlocking of value from the original four deposits is now a significant component of our ability to grow the company organically. The objective of this initiative is to have a second mine at Campo Morado by July 1, 2013."

Farallon operates the G-9 zinc mine on its Campo Morado Property in Guerrero State, Mexico. G-9 is a 1,500 tonnes per day, underground, zinc mine with important by-product credits of copper, gold, and silver, and with operating costs in the lowest 10% of zinc producers worldwide. The Company is targeting to produce at an annualized production rate of 120 million pounds of zinc and 15 million pounds of copper per year.

    ON BEHALF OF THE BOARD OF DIRECTORS
    J.R.H. (Dick) Whittington, President & CEO

           No regulatory authority has approved or disapproved the
                 information contained in this news release

Forward Looking Information

This news release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects, or is targeting, are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic, financial and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com.

Information Concerning Estimates of Indicated Resources

This news release uses the term "indicated resources". Farallon advises investors that although these terms are recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize them. Investors are cautioned not to assume that any part or all of the mineral deposits in this category will ever be converted into reserves

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    (1) Estimated indicated resources total 11.2 million tonnes of 4.7% zinc,
        0.7% copper, 1.4% lead, 165 grams per tonne of silver and 2.7 grams
        per tonne of gold.

SOURCE Farallon Mining Ltd.