Mr. Ignacio Salazar reports

OROSUR MINING INC. A FULL YEAR 2018 RESULTS

Orosur Mining Inc. has released results for the fiscal year ended May 31, 2018. All dollar figures are stated in U.S. dollars unless otherwise noted.

FY18 Highlights

Operational

• FY18 production of 27,586 oz of gold, in line with the updated guidance (27,000 - 30,000 oz), (FY17: 35,371 oz). The grade mined and processed at San Gregorio was lower than anticipated, leading to higher costs and reduced gold production.
• 875,440 tonnes of ore were processed at a grade of 1.01 g/t with recovery averaging 94.97% (FY17: 978,529 tonnes at a grade of 1.21 g/t with recovery averaging 93.41%).
• The average gold price realized for the year was $1,280/oz (FY17: $1,258/oz), an increase of 2%.
• Cash operating costs for the year were $970/oz (FY17: $829/oz), an increase of 17%, due primarily to lower production and lower ore grades. These results are in line with the updated guidance of US$900 {A –} US$1,000oz for the year.
• All-in-sustaining costs ("AISC") were $1,453/oz (FY17: $1,228/oz). The increase was due to the higher unit operating costs from the lower ore grades processed during the period and additional brownfield exploration.

Financial

• Restructuring costs of $2.8mm (FY17: nil) were recognized as a provision for layoffs representing a significant reduction in staff which left the Company with 70 employees at the end of July, as part of the initiatives to preserve cash.
• The Company invested $9.8mm in capital and $5.2mm in exploration (FY17: $10.6mm and $2.6mm, respectively). The Company significantly increased its investment in exploration as a result of the drilling campaign in Colombia.
• Operating loss of $1.1mm including higher depreciation of $8.9mm. Loss after tax and after impairment and discontinued operations was $36.9mm (FY17: profit of $2.7mm) including the recognition of the provision for layoffs ($2.8mm), write off of exploration projects ($6.0mm), loss for discontinued operation ($6.5mm), impairment ($11.0mm) and obsolescence provision of spare parts and consumables inventories ($4.7mm).
• Cash flow generated by operations before working capital investment was $3.4mm (FY17: $9.7mm).
• Cash balance at the end of FY18 $1.4mm (FY17: $3.4mm) with net working capital deficiency (current assets less current liabilities including cash) of $10.6mm (FY17: Positive net working capital of $3.1mm). Excluding Loryser assets and liabilities, the Company had total cash and cash equivalents of US$0.1mm at the end of FY18. Total debt of $1.9mm (FY17 $0.4mm). The increase is due mainly to Loryser, the Company's primary operating subsidiary drawing the $1.5mm line of credit. At present, the Company has a cash balance of $0.45mm and total debt of $1.9mm.

Exploration

• In Colombia, the Company reported high grade results of its 2018 step-out drilling campaign at APTA including 5.00g/t Au over 23m, 4.89 g/t over 13.9m, 4.86 g/t Au over 25.0m, 9.42g/t Au over 7m, 9,62g/t over 6m and 5.28 g/t over 12m.
• Drilling extended the mineralized zone at APTA down dip, up dip and along strike. Mineralized zones remain open along strike and at depth at APTA.
• To date, Orosur has reported 18 holes (MAP_54 to MAP_71) totaling 6,314 metres at APTA and as at June 7, 2018 announced the completion of a further 3,045m of diamond drilling at its Charrascala target successfully encountering gold in the system, including intersects of 3.43 g/t Au and 30.60 g/t Ag over 1.5m and 2.62 g/t Au and 14.30 g/t Ag over 0.90m.

Corporate

• On June 14, 2018 the Company applied for the Loryser Reorganization Proceedings and creditor protection, in the interest of Loryser, the Company and their stakeholders.
• Loryser continued production at SG UG until the end of July after which, during August, it is placing the mine in care and maintenance. Loryser will remain able to enter into transactions with its suite of Uruguayan assets. Orosur is currently conducting conversations with the Government and third parties to analyze different options to continue its operations in Uruguay.
• In Chile, the Company is discontinuing its operational unit. On July 2018, the Company sold its remaining 25% interest in Talca for consideration of $120k. With this sale, the Company is left with no interest or obligation in Talca. In respect of the Anillo project, Asset Chile forfeited the 16% interest it had earned and Fortune Valley returned the project to Codelco.
• The Company continues to advance discussions to finance the next stage of exploration at the Anza project in Colombia. In connection with these discussions, and as announced on July 10, 2018, a sophisticated international mining company has advanced $250k to subscribe for 3,603,077 common shares of Orosur at a price of CAD$0.091 per share. The subscription price represents a 102% premium to the closing price of the Company's common shares on the Toronto Stock Exchange on July 9, 2018.

Ignacio Salazar, CEO of Orosur, commented:

"FY18 has been a challenging year for Orosur. The weaker mineralization encountered at our SGW UG mine in Uruguay placed the Company in a precarious situation, leading to weak operating and financial performance for the year and also a number of financial impairments. The Company reacted quickly and decisively; drastically reducing costs and restructuring its various business units.

In mid-June, the Company applied to place its key operating subsidiary in Uruguay, Loryser, into voluntary creditor protection. This process is underway and the Company is making every effort to arrive at a fair and balanced plan in the interest of all our stakeholders. In Chile, we have returned the Anillo project to Codelco and sold the remaining 25% interest in Talca.

"In Colombia, the drilling campaign in Anza resulted in a number of high grade gold intercepts, providing support for our geological model as well as materially extending the known extent of mineralisation. The drilling started in October 2017 and was completed in early June 2018 and the Company has been planning the next stages of exploration as well as hosting advanced negotiations with a sophisticated senior mining company interested in progressing the Anza project with the Company. This is an exciting development for Orosur and we look forward to updating the market shortly."

 Operational & Financial Summary  1    Fiscal Year (FY) ended May 31
                                           2018     2017     Change
Operating Results                                                  
Gold produced                Ounces      27,586   35,371      7,785
Operating Cash cost3         US$/oz         970      829        141
Total Cash cost              US$/oz         989      882        107
AISC                         US$/oz       1,453    1,228        225
Average price received       US$/oz       1,280    1,258         22
Financial Results                                                  
Revenue                      US$  000    37,100   44,226    (7,126)
Net income (loss) before tax US$  000  (27,180)    2,337   (29,517)
Cash flow from operations2   US$  000     3,361    9,664    (6,303)
Cash & Debt at the end of the period       2018     2017       Diff
Cash balance                 US$ 000     1,390    3,357    (1,967)
Total Debt                   US$ 000     1,941      403      1,538
Cash net of debt             US$ 000     (551)    2,954    (3,505)

1 Results are based on IFRS and expressed in US dollars

2 Before non-cash working capital movements

3 Operating cash cost is total cost discounting royalties and capital tax on production assets.

FY19 Outlook

As a consequence of the weaker mineralization encountered at our SGW UG mine in Uruguay and the consequently difficult financial situation of the Company, the Board adopted an aggressive strategic plan which has been implemented during FY18, with the main objective to restructure its businesses, recapitalize and transform the Company by reducing corporate structure and costs in Uruguay, advancing Colombia and reducing its activities in Chile. In this process, Orosur has been actively considering options and potential partnerships to create shareholder value and is currently in advanced discussions on several alternatives to bolster capital resources to develop its assets.

During FY19, the Company expects to produce between 2,500 - 3,500 ounces of gold, with operating costs of US$1,000 - US$1,100 per ounce from the San Gregorio mine in Uruguay in Q119, after which point all production is expected to be ceased and is not expected to resume in FY19, with operations placed on care and maintenance. All future production shall depend on material developments in the funding and environmental permitting of the Veta A Underground project in Uruguay and the ongoing discussions with the government of Uruguay and other third parties.

Orosur is focusing on financing the next stages of exploration of the high grade Anza project in Colombia and is in the process of advancing a strategic alliance with a sophisticated international mining Company.

The Company anticipates that reaching a fair and balanced solution in Uruguay in the interest of all our stakeholders while partnering and advancing the next stages of exploration at the Anza project will be the primary focus of the Company during FY19.

Qualified Person

The technical information related to the current assets of Orosur in this announcement has been reviewed and approved by independent Mining engineer Miguel Fuentealba, a qualified person as defined by National Instrument 43-101.

About Orosur Mining Inc.

Orosur Mining Inc. (TSX: OMI; AIM: OMI) is a fully integrated gold producer, developer and explorer focused on identifying and advancing gold projects in South America. The Company operates in Colombia and Uruguay.

Orosur Mining Inc. Consolidated Statements of Profit/(Loss) and Comprehensive Profit/(Loss)
      (Thousands of United States Dollars except for earnings per share amounts)
                                                                     
                                                               For the years ended May 31
                                                                    2018 ($)      2017 ($)
                                                                                
Sales                                                                37,100        44,226
Cost of sales                                                      (38,170)      (40,271)
Gross profit/(loss)                                                 (1,070)         3,955
Corporate and administrative expenses                               (2,231)       (2,037)
Restructuring costs                                                 (2,840)           143
Exploration expenses                                                  (207)             -
Exploration and evaluation costs written off                        (5,999)         (131)
Impairment of assets                                               (11,083)             -
Inventory write-downs                                               (1,161)             -
Obsolescence provision                                              (4,678)         (113)
Other income                                                            995         1,525
Finance cost net                                                      (177)         (164)
Gain/(loss) on fair value of financial instruments, net                 680         (458)
Foreign exchange gain/(loss)                                            591         (383)
                                                                   (26,110)       (1,618)
Profit/(loss) before income tax                                    (27,180)         2,337
Recovery (expense) for income taxes                                 (3,121)           557
Total profit/(loss) for continuing operations                      (30,301)         2,894
Other comprehensive profit/(loss)
Cumulative translation adjustment                                      (22)            93
Total comprehensive profit/(loss) from continuing operations       (30,323)         2,988
Loss from discontinued operations                                   (6,544)         (310)
Total comprehensive loss from discontinued operations               (6,544)         2,678
Total comprehensive (loss)/ profit for the year                    (36,867)         2,678
Basic and diluted net profit/(loss) per share
Continuing operations                                                (0.26)          0.03
Discontinued operations                                              (0.06)        (0.00)