Capstone Reports Additional High Grade Intercepts & Timing to Develop Underground Access for Major Step-out Drill Program on the Mala Noche Footwall Zone at Cozamin Mine

Hole U242 Intercepts 3.3% Cu & 44g/t Ag over 7.5m (including 6.6% Cu & 84g/t Ag over 3.1m) Hole U246 Intercepts 3.0% Cu & 48g/t Ag over 6.8m (including 3.6% Cu & 55g/t Ag over 5.6m)

VANCOUVER, January 18, 2011 - Capstone Mining Corp. (CS: TSX) today announced drill results for the
five remaining exploration drill holes from the 2010 underground drill
program on the Mala Noche Footwall Zone (MNFWZ) at our Cozamin Mine, located
in Zacatecas, Mexico. High grade holes CG-10-U242 and CG-10-U246 represent
approximately 80m and 135m step outs respectively in the down dip direction
from high grade hole CG-10-235 previously announced on October 20, 2010.
Highlights are presented in the table below and the full results for all
five holes are in the table attached.

Drill Intercept Highlights for Mala Noche Footwall Zone Holes U242 and
U246

    Hole ID   Target  From (m) To (m) Interval True  Copper Silver Lead Zinc
                 Area                     (m)*   Width  (%)   (g/t)  (%)  (%)
                                                 (m)*
    CG-10-U242 MNFWZ    395.35  402.85   7.50   5.54   3.33   44.1  0.01 0.11
    Including           399.75  402.85   3.10   2.29   6.56  83.98  0.02 0.22
    CG-10-U246 MNFWZ    428.10  434.90   6.80   3.98   3.04   47.5  0.01 0.29
    Including           429.00  434.55   5.55   3.25   3.57   55.2  0.01 0.35

Capstone intends to explore the MNFWZ in 2011 with a program of
approximately 60 drill holes that will step out and infill to the east along
strike and at depth. Two cross-cuts for drilling platforms are required, one
from mine level 10 and one from level 12.3. One drift is nearing completion
and the other is scheduled to be finished in early February.

"We are looking forward to finishing the two exploration cross-cuts that
will give us the drill access we need to step-out on strike to the east and
down dip, both areas where high grade copper mineralization in the MNFWZ
remains open" said Brad Mercer, VP Exploration for Capstone. Capstone is also
encouraged by the similarity in vertical zonation of base metals in the MNFWZ
and the Mala Noche Vein (MNV) as it may have positive implications for
exploring other targets. The current copper reserve in the main MNV was
discovered by drilling beneath the largely mined out silver-zinc zone and
discovering that the vein transitioned from zinc-silver to copper-silver
dominated mineralization. The mine property contains several other known
structures marked by the numerous abandoned shafts and dumps of old silver
mines. To the best of our knowledge these other structures have not been
drill tested for copper mineralization at depth. "This offers an elegantly
simple exploration strategy, drill beneath the abandoned silver mines to seek
a transition to copper dominated mineralization," Mr. Mercer added.

Capstone believes the MNFWZ, a splay off the main MNV that hosts the
current mineral reserves provides a near term opportunity to add high grade
resources and potential high grade mill feed for the Cozamin operation. The
Company aims to produce a NI 43-101 compliant mineral resource estimate
before the end of 2011 to provide a basis to evaluate development options for
the MNFWZ. To this end and as announced on December 1, 2010 a cross-cut has
already been driven into the MNFWZ to investigate the tenor and nature of the
mineralization. Subsequent to that announcement drifts have now been driven
laterally along the hanging wall of the MNFWZ structure to the east for 60m
and to the west for 103m, exposing the vein for mapping and chip sampling.
Approximately 7,000 tonnes of development ore was mined from the drift where
face chip samples average 2.5% copper over widths averaging 4.6m. Much of
this development ore was sent to the mill but sufficient material was
sequestered for in-house metallurgical testing. One bench test has been
completed so far with a 93% recovery of the contained copper and a
concentrate grade of 28% copper plus 400 g/t silver.

Please view the accompanying long-sections to put the latest drill
intercepts into context:

capstonemining.com/i/maps/2011-02CozaminCuGradeTrend.jpg

capstonemining.com/i/maps/2011-02CozaminCuGradeXThickness.jpg

Quality Assurance/Quality Control

The technical information in this news release has been prepared in
accordance with Canadian regulatory requirements set out in National
Instrument 43-101 and reviewed by Brad Mercer, P. Geol., VP, Exploration of
Capstone. Exploration activities at the Cozamin Mine are carried out under
Mr. Mercer's supervision.

Analyses for copper, zinc, lead, silver and gold were completed by ALS
Chemex using the following method. The entire sample is crushed to a minimum
of 70% minus 10 mesh. A 250g subsample of the crushed material is then
pulverized to 85% minus 200 mesh. Gold and silver grades are determined by
gravimetric fire assay using a 50g charge taken from the pulverized material.
Copper, zinc and lead are determined by ICP analysis after 4 acid digestion
of a 0.4g subsample of the pulverized material.

Forward-Looking Information

This document may contain "forward-looking information" within the
meaning of Canadian securities legislation and "forward-looking statements"
within the meaning of the United States Private Securities Litigation Reform
Act of 1995 (collectively, "forward-looking statements"). These
forward-looking statements are made as of the date of this document and
Capstone Mining Corp. (the "Company") does not intend, and does not assume
any obligation, to update these forward-looking statements, except as
required under applicable securities legislation.

Forward-looking statements relate to future events or future performance
and reflect Company management's expectations or beliefs regarding future
events and include, but are not limited to, statements with respect to the
estimation of mineral reserves and resources, the realization of mineral
reserve estimates, the timing and amount of estimated future production,
costs of production, capital expenditures, success of mining operations,
environmental risks, unanticipated reclamation expenses, title disputes or
claims and limitations on insurance coverage. In certain cases,
forward-looking statements can be identified by the use of words such as
"plans", "expects" or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases or
statements that certain actions, events or results "may", "could", "would",
"might" or "will be taken", "occur" or "be achieved" or the negative of these
terms or comparable terminology. By their very nature forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of the
Company to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among others, risks related to actual results of current
exploration activities; changes in project parameters as plans continue to be
refined; future prices of mineral resources; possible variations in ore
reserves, grade or recovery rates; accidents, labour disputes and other risks
of the mining industry; delays in obtaining governmental approvals or
financing or in the completion of development or construction activities; as
well as those factors detailed from time to time in the Company's interim and
annual financial statements and management's discussion and analysis of those
statements, all of which are filed and available for review on SEDAR at
www.sedar.com. Although the Company has attempted to identify important
factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be
other factors that cause actions, events or results not to be as anticipated,
estimated or intended. There can be no assurance that forward-looking
statements will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking
statements.

Details for the Remainder of the 2010 MNFWZ Drill Holes

To accompany Capstone Mining News Release Dated January 18, 2011

    Hole ID   Target  From (m) To (m) Interval True  Copper Silver Lead Zinc
                Area                     (m)*   Width  (%)   (g/t)  (%)  (%)
                                                (m)*
    CG-10-U242 MNFWZ    341.15  342.20   1.05   0.77   3.26  31.62  0.01 0.10
       And     MNFWZ    395.35  402.85   7.50   5.54   3.33   44.1  0.01 0.11
    including           399.75  402.85   3.10   2.29   6.56  83.98  0.02 0.22
    CG-10-U243 MNFWZ    163.40  167.50   4.10   2.21   1.19  45.65  0.01 0.15
    including           163.40  165.75   2.35   1.27   1.88  66.94  0.01 0.15
       And     MNFWZ    208.00  211.15   3.15   1.72   1.71  28.76  0.03 0.20
    including           208.00  210.10   2.10   1.15   2.45  40.14  0.04 0.27
       And     MNFWZ    222.10  223.35   1.25   0.68   5.60  47.00  0.01 0.14
    CG-10-U245 MNFWZ    119.50  120.70   1.20   0.90   1.86  37.37  0.01 0.11
               MNFWZ    123.05  125.30   2.25   1.69   2.42  40.71  0.02 0.31
    CG-10-U246 MNFWZ    428.10  434.90   6.80   3.98   3.04   47.5  0.01 0.29
    including           429.00  434.55   5.55   3.25   3.57   55.2  0.01 0.35
    CG-10-U247 MNFWZ    112.10  113.75   1.65   1.58   0.36   5.2   0.00 0.01

For further information about Capstone, please contact: Darren Pylot,
President & CEO, or Investor Relations' Jason Howe at +1-604-684-8894 or
+1-866-684-8894 or email Capstone at info@capstonemining.com

For further information about Capstone, please contact: Darren Pylot, President & CEO, or Investor Relations' Jason Howe at +1-604-684-8894 or +1-866-684-8894 or email Capstone at info at capstonemining.com