Dr. Mark Cruise reports

TREVALI REPORTS Q1-2016 FINANCIAL RESULTS

Trevali Mining Corp. has released financial results for the three months ended March 31, 2016, reporting EBITDA (earnings before interest, taxes, depreciation and amortization) of $8-million and posting net income of $827,000 (nil per share) for the quarter. Santander zinc mine operations income for the first quarter was $4.2-million on concentrate sales revenue of $27-million. Santander site cash costs dropped significantly to 28 U.S. cents per pound of payable zinc equivalent produced, or $32.22 (U.S.) per tonne milled. Consequently, management is revising Santander 2016 site costs guidance downward by 12 per cent from $40 (U.S.) to $43 (U.S.) per tonne milled to $35 (U.S.) to $38 (U.S.) per tonne milled on a full-year basis.

This release should be read in conjunction with Trevali's unaudited condensed consolidated financial statements and management discussion and analysis for the three months ended March 31, 2016, which are available on Trevali's website and on SEDAR. All financial figures are in Canadian dollars unless otherwise stated.

First quarter 2016 results highlights:

• Santander concentrate sales revenue of $27-million;
• EBITDA of $8-million;
• Income from Santander mine operations of $4.2-million;
• Net earnings of $827,000, or nil per share;
• Total cash position of $26.7-million;
• First quarter Santander site cash costs dropped to 28 U.S. cents per pound of payable zinc equivalent produced, or $32.22 (U.S.) per tonne milled, resulting in a revision to the company's 2016 Santander production site cash operating cost guidance being reduced from $40 (U.S.) to $43 (U.S.) per tonne milled to $35 (U.S.) to $38 (U.S.) per tonne milled;
• Record Santander mill throughput of 209,000 tonnes, resulting in quarterly production of 13.7 million payable pounds of zinc, 6.4 million payable pounds of lead and 221,324 payable ounces of silver;
• Provisional realized commodity selling prices for Santander first quarter 2016 production were 82 U.S. cents per pound zinc, 82 U.S. cents per pound lead and $15.32 (U.S.) per ounce silver at International Benchmark terms under the company's off-take agreement with Glencore;
• Santander mill recoveries remain higher than design at 89 per cent for zinc, 88 per cent for lead and 76 per cent for silver.

"Santander delivered another strong quarter with site cash costs dropping significantly as a result of the optimization initiatives executed by the team. As a direct result of site efficiencies, Santander is one of the lowest cost operating mines in the central mineral belt of Peru, reporting materially improved throughput, revenue and income in spite of lower realized commodity prices on a year-to-year basis," stated Dr. Mark Cruise, Trevali's president and chief executive officer. "In Canada, the company continues to focus on commissioning the Caribou zinc mine and is pleased to announce ongoing, steady, incremental progress to date."

First quarter 2016 financial results conference call

The company will host a conference call and audio webcast at 10:30 a.m. Eastern Time (7:30 a.m. Pacific Time) on Thursday, May 12, 2016, to review the first quarter financial results. Participants are advised to dial in five to 10 minutes prior to the scheduled start time of the call.

Conference call dial-in details

Toll-free (North America):  1-866-223-7781

Toronto and international:  1-416-340-2216

                  SUMMARY FINANCIAL RESULTS  
            ($ millions, except per-share amounts)
 
                                             Q1 2016     Q1 2015

Revenues                                       $27.0       $25.9
Income from Santander mining operations         $4.2        $2.2
Net income (loss)                               $0.8       ($2.8)
Basic income per share                         $0.00      ($0.01)

              SANTANDER PRODUCTION STATISTICS

                                          Q1 2016         Q1 2015

Tonnes mined                              175,579         182,258
Tonnes milled                             209,188         185,365
Average head grades 
Zinc (%)                                    3.93%           4.03%
Lead (%)                                    1.66%           2.13%
Silver (ounces per ton)                      1.32            1.65
Average recoveries (%)
Zinc                                          89%             90%
Lead                                          88%             90%
Silver                                        76%             80%
Concentrate produced 
(dry metric tonnes)
Zinc                                       14,840          13.429
Lead                                        5,469           5,924
Concentrate grades 
Zinc (%)                                      49%             50%
Lead (%)                                      56%             60%
Ag (ounces per ton)                          38.7            41.0
Payable production
Zinc (pounds)                          13,662,766      12,536,783
Lead (pounds)                           6,436,047       7,407,887
Silver (ounces)                           221,324         254,805

                          SANTANDER SALES SUMMARY
                                                       Q1 2016        Q1 2015

Zinc concentrate (dry metric tonnes)                    14,423         12,884
Lead concentrate (dry metric tonnes)                     5,311          5,810
Payable zinc (pounds)                               13,009,008     11,793,052
Payable lead (pounds)                                6,347,250      7,271,847
Payable silver (ounces)                                210,427        244,333
Revenues (US$)                                     $19,627,603    $20,876,156
Average realized metal price
Zinc                                                    $ 0.82         $ 0.93
Lead                                                    $ 0.82         $ 0.81
Silver                                                 $ 15.32        $ 16.43
Zinc-equivalent pounds sold                         23,286,844     22,468,911
Zinc-equivalent pounds payable produced             24,229,762     23,504,206
Site cash cost per equivalent payable zinc
pound produced (US$)                                    $ 0.28         $ 0.39
Cash cost per tonne milled (US$)                       $ 32.22        $ 48.88

Santander operations, Peru

Production

Santander operations delivered another exceptional quarter with production of 13.7 million payable pounds of zinc, 6.4 million payable pounds of lead and 221,324 payable ounces of silver. Approximately 209,188 tonnes of mineralized material were processed through the mill with underground mine production of approximately 175,579 tonnes.

Metal production remains in line with 2016 annual guidance of 52 million to 55 million pounds of payable zinc in concentrate grading approximately 50 per cent zinc, 22 million to 25 million pounds of payable lead in concentrate grading approximately 56 per cent to 58 per cent lead, as well as 800,000 to one million ounces of payable silver.

The mill continues to perform at above-design recoveries with first quarter 2016 recoveries averaging 89 per cent for zinc, 88 per cent for lead and 76 per cent for silver. Average head grades were 3.93 per cent zinc, 1.66 per cent lead and 1.32 ounces per ton silver, with production of 14,840 tonnes of zinc concentrate averaging 49 per cent zinc, as well as 5,469 tonnes of lead-silver concentrate averaging 56 per cent lead and 38.7 ounces per ton silver.

During the quarter, the company sold approximately 13 million pounds, 6.3 million pounds and 210,427 ounces of zinc, lead and silver, respectively. Revenues for the first quarter were approximately $20-million (U.S.), with the average realized metal prices for the quarter of 82 U.S. cents per pound of zinc, 82 U.S. cents per pound of lead, and $15.32 (U.S.) per ounce of silver.

First quarter cash costs were approximately $32.22 (U.S.) per tonne, significantly below the company's previous annual 2016 cost guidance. Consequently, the company has revised its 2016 preliminary annual cost guidance to $35 (U.S.) to $38 (U.S.) per tonne milled (down from $40 (U.S.) to $43 (U.S.) per tonne milled). The cost savings are primarily attributed to the increased production and implementation of site-wide business initiatives, thus a larger impact on fixed costs, as well as the efficiencies and cost-cutting measures achieved to date.

During the quarter, the company also received the final geochemical assay results from its 2015 exploration program, which tested the deeper levels below the currently defined resources of the Magistral zones. In summary, the majority of the drill holes intersected zinc grades higher than those in current mining operations, with values ranging from 3.52 per cent to 12.98 per cent. The three Magistral deposits all remain open for expansion, and the company believes that there is very significant resource potential remaining in all three zones where limited downdip drilling has occurred (see March 22, 2016, news release).

Outlook

Santander operations continue at steady-state, 2,000-tonne-per-day nameplate production with site typically exceeding throughput by approximately 15 per cent to 20 per cent on a daily basis. The company continues to work with partner Glencore's local subsidiary, Empresa Minera Los Quenuales SA, to maximize and improve operational efficiencies.

An underground drill program of approximately 3,000 metres is currently in progress in order to convert inferred tonnes to a higher confidence category and to follow up on 2015 exploration successes that tested the deeper levels below the currently defined resources of the Magistral zones. Contingent on results, additional drilling may occur. The program will continue to define and potentially expand the newly discovered Rosa, Fatima and emergent Oyon lead-silver-zinc zones, in addition to the Magistral zones, which all remain open for expansion at depth.

Caribou zinc mine commissioning update

The company also provides a mine and mill commissioning update for its Caribou zinc mine in the Bathurst mining camp of northern New Brunswick. The company has provided a detailed description and discussion, and progress highlights are as shown in the attached table.

                    CARIBOU MILL -- KEY COMMISSIONING AND 
                      PRELIMINARY PRODUCTION STATISTICS 
                               (figures rounded) 
                                                       Q1 2016    April, 2016

Tonnes mined                                           191,005         58,564
Tonnes milled                                          200,670         60,032
Average mill (tonnes per day)                         2,675 (i)      2,636 (i)
Average head grades
Zinc (%)                                                  5.9%           6.1%
Lead (%)                                                  2.6%           3.0%
Silver (ounces per ton)                                    2.0            2.7 
Average recoveries (%)
Zinc                                                       71%            74%
Lead                                                       58%            57%
Silver (in lead concentrate)                               38%            32%
Concentrate produced 
(dry metric tonnes)
Zinc                                                    17,732          5,832
Lead                                                     7,586          2,634
Concentrate grades 
Zinc (%)                                                 47.8%          46.4%
Silver (ounces per ton)                                    4.0            5.3 
Lead (%)                                                 39.3%          39.6%
Silver (ounces per ton)                                   20.3           19.5 

(i) Exclusive of downtime for scheduled mill servicing and 
    maintenance cycle days.

Caribou zinc circuit summary

During the first quarter of 2016 and year to date, the Caribou metallurgical team and partner Glencore continued with the implementation of the metallurgical performance plan that mainly focuses on increasing zinc recoveries to entitlement ranges as outlined in the Caribou preliminary economic assessment report (see technical report on preliminary economic assessment for the Caribou massive sulphide zinc-lead-silver project, Bathurst, N.B., Canada, prepared by SRK Consulting (Canada) Inc., on the company's website or on SEDAR).

The company continues to focus on highlighted areas for metallurgical improvement, including decreasing the primary grind size, improved zinc-cell mixing and retention times with modifications to be implemented during continuing scheduled maintenance periods (please see news release dated April 14, 2016, for details).

Modifications, completed during April and which are continuing, continue to focus on the primary grind and zinc circuits and include:

• Improved vortex finders on three of the five cyclones, which are successfully pushing more material to the mills for grinding and resulting in feed-size reduction from approximately 36 to 41 microns to 22 microns on the modified cyclones (note that optimal target primary grind is approximately 30 microns);
• Zinc bank splitter box improvements completed and residence time in the zinc banks is essentially balanced;
• Zinc cleaner density trials have commenced and are continuing;
• Smaller three-quarters-inch charge media supply is steady and currently converting ball mill 1 charge to the same;
• Plant-scale mineralogical reports received and indicate a high degree of liberated sphalerite (approximately 89 per cent volume -- zinc) with very little locked or theoretically unrecoverable material; on the lead circuit, minimum material reported to the tails (approximately 3 per cent) as liberated galena, highlighting excellent performance; mineralogy also indicates that the IsaMills are preforming as designed;
• Initial water chemistry test work indicates that zinc recoveries are adversely affected by the calcium content of the plant process water; that is, high calcium content results in subdued zinc recoveries; the plant reagent mix was adjusted accordingly and returned 80.9-per-cent zinc recoveries to produce a concentrate grading 50.8 per cent zinc. The metallurgical team is currently focusing on optimum reagent addition points for calcium precipitation.

Continuing scheduled optimization initiatives during the second quarter include:

• SAG (semi-autogenous grinding) mill modifications, primarily the newly designed lifters and shell liners (fabrication in progress) and charge from late May onward;
• IsaMill redundancy test work;
• Test work and implementation of pumping recommendations and pumping station upgrades in June and July in order to maintain consistent cyclone feed pressures that have been impacted by fine-grind frothing;
• New instrumentation (flow meters and pressure sensors) to enable enhanced thickener performance in April and May;
• Increase the number of sample stations for the on-stream sample analyzer in April and May.

Caribou mining

Underground production during the month averaged 1,952 tonnes per day at average grade of 6 per cent zinc, 3.0 per cent lead and 2.7 ounces per ton silver.

Underground production year to date (end of April) averaged 2,062 tonnes per day at average grade of 6 per cent zinc, 2.8 per cent lead and 2.4 ounces per ton silver. With mill recoveries, specifically zinc, approaching target entitlement range levels, the Caribou team is refocusing on underground operations and plans to ramp production to 2,500 to 2,700 tonnes per day in the second quarter.

Continuing mine optimization initiatives include mobilization of an additional scoop to improve fleet support and efficiency (scheduled to arrive late May), decreasing feed/waste and average haul distances, and restructuring of technical supervision to provide seven-day support to the mine team.

Qualified person and quality control/quality assurance

Dr. Mark D. Cruise, EurGeol, Trevali's president and chief executive officer, and Paul Keller, PEng, Trevali's chief operating officer, are qualified persons as defined by National Instrument 43-101, and they have supervised the preparation of the scientific and technical information that forms the basis for this news release. Dr. Cruise is not independent of the company as he is an officer, director and shareholder. Mr. Keller is not independent of the company as he is an officer and shareholder.

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