Gold Ridge Redevelopment on Track

 

TIDMAGLD 
 
RNS Number : 2606P 
Allied Gold Limited 
13 July 2010 
 

FOR IMMEDIATE RELEASE 
 
13 July 2010 
                              allied gold limited 
                                ("the Company") 
 
                                  Media Release 
 
                        Gold Ridge Redevelopment on Track 
* A$150m project redevelopment on time on budget 
* Commissioning of 120,000 ozpa scheduled for March 2011 
* Reserves increased by 135,000oz extending Mine Life to 9 years 
* Exploration Permit lodged for additional 129km² 
* Drilling recommences at Gold Ridge 
 
Allied Gold provides the following update on its 100%-owned fully-funded Gold 
Ridge gold mine development in the Solomon Islands. 
Since February 2010 when Allied Gold acquired TSX-listed Australian Solomons 
Gold (ASG), steady progress has been made in the redevelopment of the Gold Ridge 
mine, 40 kilometres from Honiara. 
As outlined in the announcement of 17 May 2010, Allied has signed a A$64 million 
lump sum Engineering, Procurement and Construction contract for key parts of the 
project including construction and refurbishment of the 2.5 Mtpa plant.  Total 
project development costs including EPC and Owners Costs are budgeted at A$150M. 
Construction activities continue to gain momentum and ongoing works including 
additional leach tankage, cyanide detoxification, thickener installation, 
maintenance facilities, worker accommodation and village resettlement all remain 
on schedule.  In addition the first phase of mining equipment was mobilised in 
May with civil earthworks commencing on site and it is anticipated that 
pre-mining works will commence towards the end of September 2010. 
A review of the Gold Ridge's resource and mine model by independent consultants 
IMC, using a long term gold price of US$850/oz, compared to US$500/oz used in 
the 2007 Feasibility study, increases Gold Ridge Probable Reserves by 135,000 
ounces to 1.28 Million ounces (23.23 MT at 1.71 g/t).   This increases the Life 
of Mine (LOM) by a further year to 9 years for an average LOM production of 
120,000oz.  Life of mine cash cost are targeted at US$600/oz. 
The current conservative Reserve upgrade modelling reaffirms the project's 
robust economics and allows for further upgrade through the exposure to a higher 
gold price.  Management forecasts commissioning and production to commence by 
March 2011, with annualised gold production budgeted at 120,000 ounces. 
Under Allied Gold's ownership, exploration activity in the Solomon's has been 
accelerated with the mobilisation of a company owned drill rig to commence 
initial confirmatory grade control drilling followed up by a step out regional 
drilling and also initiate an intensive Induced Polarisation program over the 
largely under explored Gold Ridge mining and exploration tenure. 
Allied is keen to replicate the PNG exploration success it has achieved to date 
and to that end will commit approximately US$5 million to its near mine and 
regional exploration programme in the Solomons in 2010-11.  An exploration 
update will be discussed in the Company's June quarter report later this month. 
 
The Company has applied for a significant exploration tenement package totalling 
129km² in the region in readiness for future aggressive exploration campaigns. 
The track record of growing its gold inventory at a low exploration cost is a 
core skill Allied Gold possesses.  The exploration potential of the Solomon 
Islands to host large scale mineralisation remains high due to its geological 
regional setting and years of under exploration. 
+---------------+---------------+---------------+---------------+ 
| Gold Ridge    |      Mt       |      g/t      |      Moz      | 
+---------------+---------------+---------------+---------------+ 
| Proven        |      -        |      -        |      -        | 
+---------------+---------------+---------------+---------------+ 
| Probable      |     23.3      |     1.71      |     1.28      | 
+---------------+---------------+---------------+---------------+ 
| Total         |     23.3      |     1.71      |     1.28      | 
| Reserves (I)  |               |               |               | 
+---------------+---------------+---------------+---------------+ 
| Measured      |      6.1      |     1.92      |     0.37      | 
+---------------+---------------+---------------+---------------+ 
| Indicated     |     23.0      |     1.66      |     1.23      | 
+---------------+---------------+---------------+---------------+ 
| Inferred      |      8.4      |     1.80      |     0.48      | 
+---------------+---------------+---------------+---------------+ 
| Total         |     37.6      |     1.73      |     2.09      | 
| Resources     |               |               |               | 
| (II)          |               |               |               | 
+---------------+---------------+---------------+---------------+ 
| I.       Reserves of June 2010, Resources as of May 2010      | 
| II.      Resources are inclusive of Reserves at a cut-off     | 
| grade of 0.8 g/t                                              | 
| The resources at Gold Ridge were largely proved through test  | 
| work conducted by Ross Mining between 1994 and 1998.          | 
| Note: Resources and Reserves have been prepared under the     | 
| "Australasian Code for Reporting of Exploration Results,      | 
| Mineral Resources and Ore Reserves                            | 
+---------------+---------------+---------------+---------------+ 
 
 
For more details please contact: 
 
Frank Terranova         Chief Financial Officer                  [phone] 
Simon Jemison           Investor and Media                        + 61 418 853 
922 
Rebecca Greco            Investors (North America)           [phone] 
John Carrick-Smith   Investors (UK)                                   +44 20 
7559 6710 
 
Beaumont Cornish Limited 
 
Roland Cornish 
Beaumont Cornish Limited 
T: [phone] 
 
 
Competent Persons 
 
The information in this announcement that relates to Mineral Resources, Project 
Financial modelling, Mining, Exploration and Metallurgical results, together 
with any related assessments and interpretations, has been approved for release 
by Mr C R Hastings, MSc, BSc, M.Aus.I.M.M., a qualified geologist and full-time 
employee of the Company.  Mr Hastings has sufficient experience which is 
relevant to the style of mineralisation and type of deposit under consideration 
and to the activity which he is undertaking to qualify as a Competent Person as 
defined in the 2004 Edition of the "Australasian Code for Reporting of 
Exploration Results, Mineral Resources and Ore Reserves". Mr Hastings consents 
to the inclusion of the information contained in this release in the form and 
context in which it appears. 
Forward-Looking Statements 
 
This press release contains forward-looking statements concerning the projects 
owned by Allied Gold.  Statements concerning mineral reserves and resources may 
also be deemed to be forward-looking statements in that they involve estimates, 
based on certain assumptions, of the mineralisation that will be found if and 
when a deposit is developed and mined.  Forward-looking statements are not 
statements of historical fact, and actual events or results may differ 
materially from those described in the forward-looking statements, as the result 
of a variety of risks, uncertainties and other factors, involved in the mining 
industry generally and the particular properties in which Allied has an 
interest, such as fluctuation in gold prices; uncertainties involved in 
interpreting drilling results and other tests; the uncertainty of financial 
projections and cost estimates; the possibility of cost overruns, accidents, 
strikes, delays and other problems in development projects, the uncertain 
availability of financing and uncertainties as to terms of any financings 
completed; uncertainties relating to environmental risks and government 
approvals, and possible political instability or changes in government policy in 
jurisdictions in which properties are located. 
 
Forward-looking statements are based on management's beliefs, opinions and 
estimates as of the date they are made, and no obligation is assumed to update 
forward-looking statements if these beliefs, opinions or estimates should change 
or to reflect other future developments. 
 
Not an offer of securities or solicitation of a proxy 
 
This communication is not a solicitation of a proxy from any security holder of 
Allied Gold, nor is this communication an offer to purchase or a solicitation to 
sell securities.  Any offer will be made only through an information circular or 
proxy statement or similar document.  Investors and security holders are 
strongly advised to read such document regarding the proposed business 
combination referred to in this communication, if and when such document is 
filed and becomes available, because it will contain important information.  Any 
such document would be filed by Allied Gold with the Australian Securities and 
Investments Commission, the Australian Stock Exchange and with the U.S. 
Securities and Exchange Commission (SEC). 
 
Neither the ASX, TSX or AIM exchanges have approved, nor disapproved, the form 
or content of this announcement. 
 
NOT FOR DISSMENATION OR DISTRIBUTION IN THE UNITED STATES AND NOT FOR 
DISTRIBUTION TO US NEWSWIRES 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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