DPM Dundee Precious Metals Inc

Dundee Precious Metals Inc. (TSX:DPM)(TSX:DPM.WT.A) ("DPM" or "the Company") has
entered into an agreement with Xiangguang Copper Co. ("XGC") for the sale of up
to 200,000 tonnes per year of pyrite concentrate to be produced at DPM's
Chelopech mine in Bulgaria (the "Agreement") during Stage 1 of its gold in
pyrite recovery project (the "Project"). The total annual concentrate supply to
XGC is expected to contain between 28,000 and 30,000 ounces of payable gold at a
cash cost of approximately US$1,200 per ounce. DPM will earn a payable amount
based on the gross value of the concentrate at spot prices, net of certain
transportation and processing costs.


"We are extremely pleased with this arrangement with XGC which secures a sales
outlet for our clean Chelopech pyrite concentrate," stated Jonathan Goodman,
President and CEO. "This not only generates cash flow on previously unrecovered
gold ounces for relatively low capital while we continue the evaluation and
execution of Stage 2 of our project, it also establishes that there is an
expanding market for our pyrite products." Mr. Liu, Chairman of XGC stated "XGC
is also very happy to provide solutions to DPM with its unique technologies and
skills. The cooperation between the two companies will be mutually beneficial
and complementary."


The reconfiguration of the Chelopech mill during 2013 will bring annual
production capacity of pyrite concentrate to 400,000 tonnes. The Agreement
provides for the purchase by XGC of up to 200,000 tonnes per year of pyrite
concentrate from Chelopech Mining EAD, a wholly-owned subsidiary of DPM and
owner of the Chelopech mine, from 2014 to 2016. There is also the possibility of
a further sale of up to 50,000 tonnes of pyrite concentrate during 2013, subject
to confirming the capability of the existing mill process equipment to produce
moderate amounts of pyrite concentrates in batch runs. Sales in 2016 are
conditional upon various global factors such as the gold price, shipping rates
and acid prices in China remaining satisfactory. The Agreement is subject to
requisite permitting, government approvals and completion of the mill
reconfiguration. 


In addition, XGC has agreed to purchase 2,000 tonnes per month of Chelopech
copper concentrates, on market competitive terms, starting April 2013 for a
minimum of 12 months. Purchases will continue from March 2014, subject to three
months' cancellation notice by either Chelopech or XGC.


Background

Chelopech is an underground gold, copper and silver mine, which currently
produces a copper concentrate with metal recoveries averaging 55%, 85% and 42%,
respectively. The preliminary economic assessment, reported in the National
Instrument 43-101 Technical Report for the Chelopech Project, Bulgaria filed on
SEDAR on September 10, 2012, confirmed that through this Project there is
potential to recover most of the unrecovered gold, silver and copper. The bulk
of these unrecovered metals are mainly associated with the mineral pyrite, which
is currently rejected in the flotation process to ensure a saleable copper
concentrate. Once Bulgarian regulatory approval is received, reconfiguration of
the Chelopech mill will consist of the installation of a new flotation,
thickening and filtration system, creating a pyrite concentrate circuit.
Consequently, at the full mine production rate of 2 million tonnes per annum,
approximately 400,000 tonnes of pyrite concentrate, free of deleterious matter,
will be generated from the mill feed as a separate concentrate product in
addition to the copper concentrate already produced. The reconfiguration of the
mill is expected to take approximately twelve months and be completed by the end
of 2013 at an estimated capital cost of US$23 million. The sale of the pyrite
concentrate to XGC will generate initial cash flow while the remaining phases of
Stage 2 of the Project are being designed, permitted and constructed. 


XGC is one of the largest modern copper smelting companies in China and in the
world. Its smelter plant, located in Yanggu, County of Shandong Province, China,
employs the advanced double flash smelting technology and is operated with high
cost efficiency and superior environmental standards. The smelter has designed
capacities of 450,000mt blister, 500,000mt cathodes, 1,400,000mt sulphuric acid
and 650,000 ounces of gold every year. 


DPM is a Canadian based, international gold mining company engaged in the
acquisition, exploration, development, mining and processing of precious metals.
The Company's principal operating assets include the Chelopech operation, which
produces a gold, copper and silver concentrate, located east of Sofia, Bulgaria;
the Deno Gold operation, which produces a gold, copper, zinc and silver
concentrate, located in southern Armenia; and the Tsumeb smelter, a concentrate
processing facility located in Namibia. DPM also holds interests in a number of
developing gold properties located in Bulgaria, Serbia, and northern Canada,
including interests held through its 51.4% owned subsidiary, Avala Resources
Ltd., its 47.3% interest in Dunav Resources Ltd. and its 10.7% interest in
Sabina Gold & Silver Corp. 


Forward-Looking Statements 

This news release contains "forward-looking statements" that involve a number of
risks and uncertainties. Forward-looking statements include, but are not limited
to, statements with respect to the future price of gold and silver, the
estimation of mineral reserves and resources, the realization of mineral
estimates, the timing and amount of estimated future production and output,
costs of production, capital expenditures, costs and timing of the development
of new deposits, success of exploration activities, permitting time lines,
currency fluctuations, requirements for additional capital, government
regulation of mining operations, environmental risks, unanticipated reclamation
expenses, title disputes or claims, limitations on insurance coverage and timing
and possible outcome of pending litigation. Often, but not always,
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 state that certain
actions, events or results "may", "could", "would", "might" or "will" be taken,
occur or be achieved. Forward-looking statements are based on the opinions and
estimates of management as of the date such statements are made, and they
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 other future results, performance or achievements expressed
or implied by the forward-looking statements. Such factors include, among
others: the actual results of current exploration activities; actual results of
current reclamation activities; conclusions of economic evaluations; changes in
project parameters as plans continue to be refined; future prices of gold,
copper, zinc and silver; possible variations in ore grade or recovery rates;
failure of plant, equipment or processes to operate as anticipated; 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, fluctuations in metal prices, as well as those risk
factors discussed or referred to in documents filed from time to time with the
securities regulatory authorities in all provinces and territories of Canada and
available 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 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. Unless required by securities laws, the Company
undertakes no obligation to update forward-looking statements if circumstances
or management's estimates or opinions should change. Accordingly, readers are
cautioned not to place undue reliance on forward-looking statements.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Dundee Precious Metals Inc.
Jonathan Goodman
President & Chief Executive Officer
(416) 365-2408
jgoodman@dundeeprecious.com


Dundee Precious Metals Inc.
Lori Beak
Senior Vice President, Investor & Regulatory
Affairs and Corporate Secretary
(416) 365-5165
lbeak@dundeeprecious.com

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