• Drilling program continues to confirm high-grade silver-gold mineralization and substantial true widths at the "La Sidra" vein
• Drilling is currently active on the Bolivar West zone. A recent geophysical program utilizing Titan 24 techniques has targeted near-surface, coincident strong chargeability (IP) and resistivity anomalies in the Southwestern sector of the property near Bolivar West.
• Exploration programs targeted to increase tonnage and grade

TORONTO, March 6, 2017 /PRNewswire/ - Sierra Metals Inc. (TSX: SMT) (BVL: SMT) ("Sierra Metals" or "the Company") announces the results of the initial drill program on the Bolivar property in Chihuahua State, Mexico and continues to define high grade silver-gold and polymetallic mineralization within the La Sidra vein. The mineralized zone currently extends to over 500 meters in length and to 300 meters in depth and is still open along strike and down dip.

Drilling programs also continue at Bolivar West with future plans to drill Bolivar North West (skarn ore deposit area) to define high grade copper with coincident strong chargeability and within resistivity zones detected during a recently completed a 400 Hectare Titan 24 Induced Polarization ('IP') survey conducted by Quantec Geosciences of Toronto, Ontario.

Mark Brennan, President and CEO of Sierra Metals stated "We have been seen tremendous growth in ore throughput and copper production at the Bolivar Mine over the past 5 years, however we have also seen ore grade erosion that has partly offset the expansion benefits of our earnings potential. Since 2015 we have been working aggressively to add new higher-grade, higher-value tonnage at Bolivar. Our objectives for 2017 are to increase production further, reduce costs and complete successful brownfield exploration that can be brought into the production schedule in 2018." He continued, "The Bolivar district is prolific in its geological activity. We are optimistic that we can add resource tonnage while also improving ore grade.  This makes us optimistic for our cash flows and EBITDA outlook in 2018."

The Bolivar Mine is located approximately 250 km southwest of Chihuahua City, located in the Southwest portion of Chihuahua state, Mexico. The mine area encompasses 15,217 hectares (see Figure 5).

Bolivar mine throughput has grown continually from 400 tonnes per day (tpd) in 2011 to 2,700 tpd currently, and its annual copper equivalent production has grown from 3.9 million pounds in 2011 to annual copper equivalent production of 21.2 million pounds in 2016. As tonnage production rates have increased at Bolivar, the Company has realized modest reduction in its all-in sustaining costs, not truly reflecting the economies of scale of tonnage increases. This is primarily due to lower average copper head grades.

Similar to the operational improvement program completed at the Yauricocha Mine in Peru, the Company is working on a similar program at Bolivar in 2017. The Company's focus at Bolivar this year will be on efforts that can improve production volume, increase throughput and increase recoveries at the Mill

Exploration Update

A planned 20,000-metre drilling program has been budgeted with 9,500 meters of In-fill drilling planned at La Sidra and 11,500 meters at Bolivar West and Bolivar NorthWest.  Currently drilling is being conducted on Bolivar West zone. The purpose of these programs is to define existing known areas.  Once final results are available from the geophysical program, further drilling programs will be carried out.

Table 1.1. Recent drilling results from La Sidra Zone are summarized in the table below:

Figure 2 - Shows the distribution of the current drilling program in the study area of La Sidra Vein. 

"The drilling program at the La Sidra zone continues to confirm the existence of high grade gold-silver mineralization which is still open along strike NE-SW by 2.5 kilometers as well as down dip. We have recently completed a Titan 24 survey at Bolivar West and Bolivar NorthWest. Strong anomalies have been defined and the drilling program will target the coincident strong anomaly zones" stated J. Alonso Lujan, Vice President Exploration of Sierra Metals. "We expect in the short term to significantly increase inventories of mineral resources at our Bolivar operations."

Table 1.2. Recent drilling results from the Bolivar West Zone are summarized in the table below:

The Sierra Madre Occidental is the consequence of the one of largest volcanic events in the world that occurred between the Cretaceous and the Tertiary periods and is one of the largest known precious-metal metallogenic regions and is host to numerous well known gold-silver producing mining districts including: Ocampo, Tayoltita, Concheño, Topia, Mulatos, Guanacevi, El Sauzal and Pinos Altos.

The Mineral Resources of Bolivar are contained within three styles of mineralization within the Sierra Madre Occidental:

• Two mineralized stratabound zones, the Upper and the Lower Skarn, which display two types of copper zinc mineralization: 1) a typical high grade copper zinc pipe breccia mineralization (Upper Skarn); and lower grade copper-magnetite replacement mineralization (Lower Skarn)
• Typical epithermal vein system containing precious metals.

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 for Bolivar dated May 31, 2013. All samples are sent to ALS Chemex, samples were transported under Sierra Metals chain of custody to ALS Chemex (ISO 9001) in Chihuahua City, these were dried, crushed and pulverized by ALS Chemex in Chihuahua City, pulp samples were shipped by ALS Chemex to their laboratory in Vancouver, Canada.

Drilling Methodology

The procedures used during diamond drilling include:

• Holes are drilled to produce HQ (63mm) or NQ (48mm) sized core.
• The collar locations of all drill holes are surveyed using GPS and local coordinates.
• All drill core is washed – realigned and digitally photographed prior to logging and sampling.
  
  

Qualfied Persons

All technical data contained in this news release has been reviewed and approved by Gordon Babcock, P.Eng., Chief Operating Officer and a Qualified Person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects.

About Sierra Metals

Sierra Metals Inc. is a Canadian-based polymetallic mining company with production from its Yauricocha Mine in Peru, and its Bolivar and Cusi Mines in Mexico. The Company recently completed a very successful operational improvement program at its Yauricocha Mine and is now focused on completing a similar program at each of its Mexican operations in order to increase production volume, recoveries and modernize operations. Sierra continues to grow its mineral resources with several exciting brownfield opportunities such as the Esperanza Zone at the Yauricocha Mine, which went from first discovery to mining in less than one year.  The Company has several other brownfield exploration opportunities at all three mines in Peru and Mexico that are within, or very close to, the existing mines. Sierra is actively exploring these opportunities and hopes to daylight them in the short-term.  The Company has large land packages at all three mines with several regional, highly prospective targets providing longer-term exploration upside and mineral resource growth potential.

The Company's shares trade on the Lima Stock Exchange (Bolsa de Valores de Lima) and on the TSX 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. Statements containing forward-looking information express, as at the date of this news release, the Company's plans, estimates, forecasts, projections, expectations or beliefs as to future events or results.  These statements reflect the Company's current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. 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 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.

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SOURCE Sierra Metals Inc.