ALBUQUERQUE, NM, Jul 19, 2012 (MARKETWIRE via COMTEX) — Lone Star Gold, Inc. /quotes/zigman/5448492/quotes/nls/lstg LSTG +5.66% (“Lone Star” or “the Company”) is pleased to provide an update on its Tailings Project operations and expansion near the city of Hidalgo Del Parral in the state of Chihuahua, Mexico.

Two out of Lone Star’s three on-site washing jigs are now complete and operational. The jigs enable the Company to more than double the assay results for the project’s tailings by separating the heavy mineral-rich material from the lighter worthless material in the tailings. To date, Lone Star has been pre-washing material for 2 months to maximize the silver and gold content per ton of material to be shipped to 1 of 2 nearby floatation and leaching plants in Parral.

The first processing plant selected in Parral was unexpectedly offline for the last few months and is now being run by the state government under a new management team that arrived at the plant on June 1st. The new management decided to retrofit multiple of the major components in the plant’s crushing stages and automate some of the conveyor system. The plant is expected to resume processing by mid-July. The plant management has agreed to receive and process 200 tons per day (tpd) of the Company’s tailings material on a going forward basis. In addition, Lone Star is negotiating an agreement with a second nearby processing plant. The second plant continues to receive small amounts of the Company’s washed concentrate, and is currently fine-tuning and determining the optimal processing route for the material. While the process has required more time than was initially anticipated, progress continues to be made.

Finally, the team in Mexico has completed all preliminary study regarding the construction of a benign nitrogen leaching pile process plant on the Tailings Property. The leaching plant will be capable of processing in excess of 1,000 tpd. This relatively new leaching process represents the benefits of not using cyanide and of having minimal environmental impact. The Mexico team has put together a team of metallurgists, engineers and construction crews to execute the leaching plant construction once all the necessary permits are in place.

Lone Star Gold’s President, Daniel Ferris, commented: “Even with no warning of the plant management changing hands, our team in Mexico not only quickly rectified the situation but also negotiated a larger processing deal with the new management that should more than double our first year production goal. We have also negotiated with a new concentrate purchaser, which will increase our return by over 5% and speed up concentrate sales payments to the company.”

Cautionary Note to U.S. Investors -The United States Securities and Exchange Commission permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We may use certain terms in this press release, such as “measured,” “indicated,” and “inferred” “resources,” which the SEC guidelines strictly prohibit U.S. registered companies from including in their filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 10-K which may be secured from us, or from our website at http://www.sec.gov/edgar.shtml .

ADDITIONAL INFORMATION To learn more about the Tailings Project, the Company, and regular news updates, visit Lone Star Gold’s official website: http://www.lonestargold.com .

ABOUT LONE STAR: Lone Star Gold, Inc. is a publicly traded /quotes/zigman/5448492/quotes/nls/lstg LSTG +5.66% gold exploration and development company based in Albuquerque, New Mexico. The Company’s aggressive acquisition and exploration approach is strategically focused on proven, stable precious metal regions in America and Mexico. Currently, Lone Star has a 70% Working Interest in concessions covering 800 hectares in the La Candelaria project in Chihuahua, Mexico, which the Company is evaluating to determine the potential sites that represent the best potential for silver and gold deposits. Lone Star also has an undivided 65% interest in the San Antonio del Potrero mine tailings project near the city of Hidalgo Del Parral in the state of Chihuahua, Mexico.


Lone Star Gold, Inc. Daniel Ferris, Company President

This press release contains statements that are forward-looking and which involve a number of risks and uncertainties. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements in question are based on Lone Star Gold, Inc.’s current expectations and projections about future events, based on information currently available. The forward-looking statements found in this press release may also include statements relating to Lone Star Gold, Inc.’s anticipated financial performance, business prospects, new developments, strategies, and similar matters. Lone Star Gold, Inc. provides no assurance regarding the actual outcome of the events contemplated by any forward-looking statements included in this release. Lone Star Gold, Inc. disclaims any obligation to update any of its forward-looking statements, except as may be required by law.

Lone Star Gold, Inc.
6565 Americas Parkway NE, Ste 200
Albuquerque, New Mexico

Toll Free: 1-800-986-9358
E-mail: [email protected]