Simberi Oxide Project Update

RNS Number:0143F
Allied Gold Limited
22 June 2006



          



FOR IMMEDIATE RELEASE                                    22 June 2006



                              ALLIED GOLD LIMITED


                          SIMBERI OXIDE PROJECT UPDATE


As previously announced the Company, in conjunction with its design engineer
Intermet Engineering Ltd, has been working to complete an updated capital and
operating cost estimate for the Simberi Oxide Gold Project incorporating an
aerial rope conveyor system for ore delivery to the plant and a 2.0Mtpa
throughput. Whilst this work is not yet complete the Company is in a position to
advise that it expects there will be an increase in the estimated capital cost.
The magnitude of the increase and its effect on the project economics are not
yet known.


In addition to working on the revised capital and operating cost estimate the
Company and its consultants are also working on a revision to the mine design
and mining schedule, taking into account drilling results received since the
database was closed off for the 2005 Optimised Feasibility Study, and the
prevailing gold prices.


The revised cost estimates and mine design/schedule will form the input to a
revision of the project financial model. The market will be updated as soon as
this work is completed.


Any revision is likely to have an impact on the construction schedule by
delaying the ordering of key equipment items.


The Company is continuing early start earthworks and detailed engineering of the
treatment facility and infrastructure.


For enquiries in connection with this release please contact:


Wayne Loxton
Managing Director
Allied Gold Limited
[phone] phone
[phone] fax
[e-mail] e-mail



Forward-Looking Statements.


This press release contains forward-looking statements concerning the projects
owned by Allied. 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, nor is this communication an offer to purchase nor 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 with the Australian Securities and Investments
Commission, the Australian Stock Exchange and with the U.S. Securities and
Exchange Commission (SEC).


"This press release is not for dissemination in the United States and shall not
be disseminated to United States news services"







                      This information is provided by RNS
            The company news service from the London Stock Exchange

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