Sierra Metals' drilling extends mineralization at previously defined exploration target at the Yauricocha Mine, Peru

VANCOUVER, Aug. 29, 2013 /CNW/ - Sierra Metals Inc. (TSX:SMT)(BVL:SMT) ("Sierra Metals" or the "Company") is pleased to announce that drilling at its Yauricocha Mine in Peru has extended mineralization to depth at the previously identified exploration target below Central Mine Area at the Yauricocha Mine, Peru. These results demonstrate that the mineralization in the various ore bodies of the Central Mine Area continues below the 1270 Level and remains open to depth.

"These results support our previous statements that high-grade ore continues to depth in the Central Mine Area," said Daniel Tellechea, the Company's President and CEO. "Drilling has significantly extended mineralization of the Rosaura ore body over a strike length of 150 meters and more than 250 meters to depth, which will add tonnage to our resources when an updated NI 43-101 estimate is completed later this year. Additional drilling will be done to extend other bodies below current workings with the intent of increasing known reserves and resources in the future."

Drilling in the Central Mine Area

The Company's 2013 drilling activities have successfully extended mineralization of the previously announced exploration target below the Central Mine Area to depth (see press release dated September 12, 2012). Existing drill stations allowed drilling of the Rosaura orebody to depth as well as in-fill drilling on the Catas and Antacaca ore bodies.

The longitudinal section of the Central Mine Area (Figure 1: Long Section Showing Drill Piercing Points in Orebodies of the Central Mine.) shows the positions of the piercing points of the drill holes reported herein. Drilling has shown that the known extent of the Rosaura ore body has been expanded an additional 150 x 250 meters beyond the NI 43-101 resource boundary. The tonnage for this volume will be estimated during the update to the current resource, which is scheduled for late this year.

Although additional drilling is required to substantiate the trend of metal content to depth, the Rosaura ore body appears to become copper-dominant with depth. The average copper grade in the drill intercepts reported herein is 1.15% Cu whereas the average copper grade in the NI 43-101 resource ranges from 0.64-0.72% Cu, depending on the resource category. In addition, lead and zinc grades are decreasing, indicating the Rosaura ore body is changing from polymetallic-dominant to copper-dominant with increasing depth and apparently merging with the Catas-Antacaca ore bodies. This trend is typical of this type of deposit, wherein copper contents increase with depth.

Mineralization at Yauricocha is of high-temperature, carbonate-replacement type. These deposit types have great depth extents, and in Peru similar deposits have been mined to depths of 1,400-1,600 meters, such as El Porvenir and Yauliyacu. The Company's geologists infer that there is no geologic reason why mineralization at the Central Mine Area should be truncated or cut off at depths that are economically feasible to mine, given the age of the mineralization and the geologic history of the region since ore deposition.

Drilling of Antacaca Sur requires development of a new drill station on the 920 level, which is scheduled for completion in mid 2014. The Company's geologists anticipate that this drilling will also demonstrate a significant depth extension to the Antacaca Sur ore body. The piercing points of proposed holes that will be drilled to test the depth extension of the Antacaca Sur ore body are shown in Figure 1.

Drill Results from Rosaura and Rosaura North Ore bodies

* Note: all holes have prefix ROS-

Drill Results from Catas Ore body

* Note: all holes have prefix CAT-

Drill Results from Antacaca Ore body

* Note: all holes have prefix ANT-

Method of Analysis

Samples are prepared at the Yauricocha lab facility at the Chumpe mill, which is on site. Core and channel samples from the mine are assayed utilizing one of two procedures. Silver, lead, zinc and copper are assayed by atomic absorption. Gold is fire-assayed with an atomic absorption finish. Diamond drill samples sent for analysis consist of half NQ-size and BQ-size diamond core split on site.

Quality Control

The quality assurance-quality control (QA-QC) program employed by Sierra Metals has been described in detail in the NI 43-101 report on Yauricocha dated May 25, 2012, prepared by Gustavson Associates of Denver, which is available for review on SEDAR.

The technical content of this news release has been approved by Thomas L. Robyn, Ph.D., CPG, RPG, a Qualified Person as defined in NI 43-101.

About Sierra Metals

Sierra Metals Inc. is a Canadian mining company focused on production of precious and base metals from its Yauricocha Mine in Peru, its Bolivar Mine and Cusi Mine in Mexico. In addition, Sierra Metals is exploring several precious and base metal targets in Peru and Mexico. Projects in Peru include Adrico (gold), Victoria (copper-silver) and Ipillo (polymetallic) at the Yauricocha Property in the province of Yauyos and the San Miguelito gold properties in Northern Peru. Projects in Mexico include Bacerac (silver) in the state of Sonora, La Verde (gold) at the Batopilas Property in the state of Chihuahua, and Las Coloradas (silver) at the Melchor Ocampo Property in the state of Zacatecas.

The Company's shares trade on the Bolsa de Valores de Lima and the Toronto Stock Exchange under the symbol "SMT".

Forward-Looking Statements

Except for statements of historical fact contained herein, the information in this press release may constitute "forward-looking information" within the meaning of Canadian securities law. Other than statements of historical fact, all statements are "forward-looking statements", which involve various known and unknown risk and uncertainties and other factors, including market conditions that may affect the Company's ability to execute its current business plan. Actual results might differ materially from results suggested in any forward-looking statements. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in filings by the Company with the Canadian securities regulators, which filings are available at www.sedar.com.

SOURCE Sierra Metals Inc.

Image with caption: "Figure 1: Long Section Showing Drill Piercing Points in Orebodies of the Central Mine. (CNW Group/Sierra Metals Inc.)". Image available at: http://photos.newswire.ca/images/download/20130829_C8960_PHOTO_EN_30236.jpg