Mr. Jeffrey Clevenger reports

GOLDEN MINERALS TO RESTART VELARDENA MINING IN JULY 2014

Golden Minerals Company. has released plans for a July, 2014, restart of mining at its Velardena properties located in Durango state, Mexico. Once mining and processing are ramped up to approximately 285 tonnes per day (tpd) of sulphide ore in mid-2015, the company expects output of approximately one million to 1.2 million silver equivalent ounces per year (including silver and gold but excluding lead and zinc), with cash costs between $12 and $15 per silver ounce net of byproduct credits. Golden has completed a 9,000-metre drill program at Velardena in vein systems located largely outside the currently defined Canadian National Institute 43-101-compliant resource. That drill program represents the first known drilling of the Terneras vein system sulphides in the area below the historic mine workings. The company's drilling, mine planning and analysis indicate that positive net cash flow may be achieved at the Velardena properties at current silver and gold prices. An independent engineering firm participated in the preparation of the mining plan.

Chairman, president and chief executive officer Jeffrey G. Clevenger noted: "Our team has worked diligently since the suspension of operations at Velardena to streamline the operation for a restart. A year ago we were looking at cash costs in excess of $30 per silver ounce and now we are excited to begin the ramp-up process to achieve costs and margins based on production at $12 to $15 per silver ounce. Once ramped up, our restart plans show incremental cash for the company of about $5[-million] to $8-million per year at today's prices (approximately $20 per ounce silver and $1,250 per ounce gold) as compared to holding the property for the future."

Lower cost operation

The company plans to reopen Velardena as a leaner and lower cost mine. The company has hired a new and proven team of mining professionals including a new general manager and managers for both the mine and mill. By year-end 2014, the property is projected to employ approximately 150 people, with approximately 100 employees under a new labour union agreement. This figure is less than one-third the number employed prior to June, 2013, when the company was running both sulphide and oxide plants and processing a combined total of approximately 500 tpd. Shortly prior to suspending mining operations in 2013, Golden Minerals completed a 1.9-kilometre, production-sized access ramp into the Velardena mine. This ramp will provide more efficient and lower cost removal of mined material from the underground mine workings as compared with presuspension haulage primarily from a low-capacity internal shaft.

The company plans to reopen Velardena utilizing an overhand cut-and-fill mining method and slusher mucking in the stopes. This mining method should allow mining vein widths as narrow as 0.5 metre, which should significantly decrease dilution and allow higher-grade material to be hauled to the mill. For conservative planning purposes, the company has assumed dilution of the veins to one-metre widths.

Going forward, the company expects mining to focus on the San Mateo and Terneras vein systems. Drilling results and metallurgical studies indicate that these two systems, mined only intermittently by Golden in the past, contain higher-grade material over more consistent widths in the 0.5-to-one-metre range, with significantly lower arsenic levels than those seen in the Santa Juana vein system that was the focus of previous mining activity. The company expects that the lower arsenic will provide improved payment terms and metallurgical recovery of the metals.

Timeline of activities

Golden Minerals plans to begin mining in the third quarter 2014, focused primarily in the San Mateo vein. The company anticipates stockpiling mined material until the fourth quarter 2014, at which time the company expects to commence processing mined material through the sulphide mill. Golden Minerals anticipates mining from both the San Mateo and Terneras vein systems during the fourth quarter 2014, with mining in the Terneras vein ramping up in the second quarter 2015. Plans call for sulphide mill processing of approximately 150 tpd during the fourth quarter 2014, with processing increasing to approximately 285 tpd in mid-2015. The company expects to produce payable metals beginning in the fourth quarter 2014 of approximately 150,000 ounces of silver equivalents (including silver and gold but excluding lead and zinc), increasing to approximately 275,000 ounces of silver equivalents per quarter in mid-2015 when the ramp-up is completed. The plan forecasts cash costs per silver ounce, net of byproduct credits, of approximately $30 in the fourth quarter 2014, decreasing to between $12 and $15 by mid-2015. The mining plan calls for production of lead, zinc and gold-bearing pyrite concentrates. The mining plan is based on favourable results of preliminary metallurgical testing and the company's expectation, based on the results of the 2014 drill program, that processed material will contain an average of approximately four grams per tonne gold and from 200 to 250 grams per tonne silver. As noted above, other than portions of the San Mateo vein, this material is not included in the company's NI 43-101 resource or in the company's reported mineralized material.

2014 costs

The incremental 2014 cash outlay to resume operations is estimated at $3-million. This comprises $1-million in restart capital costs for mill improvements and slusher equipment plus $3-million of negative gross margin (revenue less cost of sales) in 2014, offset by approximately $1-million of avoided care and maintenance costs associated with holding the property in suspension. The company also plans to explore possible sales of excess mining equipment which could offset part of the $3-million cash outlay.

We seek Safe Harbor.