Norseman Gold PLC Update on Activities (8591K)

TIDMNGL

RNS Number : 8591K

Norseman Gold PLC

28 August 2012

Norseman Gold plc / Epic: NGL / Index: AIM / Sector: Mining & Exploration

28 August 2012

AIM: NGL

ASX: NGX

NORSEMAN GOLD PLC

('Norseman Gold' or 'the Company')

Update on Activities

Norseman Gold plc (the "Company"), the ASX and AIM listed gold producer is pleased to provide an update on operations at its Norseman Gold Project.

OPERATIONS

General

The Company's activities at its Norseman Gold Project has continued to focus on the following:

a. Improvements to short and long term planning, including development of new block models for the North Royal open pit

   b.    Operational improvements including  grade control and reconciliation processes 
   c.     Scoping of improvement requirements at the Harlequin underground 
   d.    Control of expenditure 
   e.    Maintenance of manning levels and introduction of accredited training practices 
   f.     Key Staff recruitment 

North Royal Open Cut

North Royal open cut operations has continued to operate within both north and south zones of the pit. Mining has now progressed through the oxide zone into fresh rock.

Completion of an update to the block models used for North Royal has allowed completion of updated mine plans for the open pit. Scheduling for current production activities from North Royal has been undertaken on the basis of increasing production to cover the shortfall in Harlequin production in the near term.

Supplementary Production

The Company is currently working on a number of alternative opportunities to underpin production during the course of the next 12 months. These include the following:

   --     Dedicated plans for recommencement of operations at Bullen and/or OK mines 
   --     Reopening Scotia open pit operations 
   --     Processing available low grade and tailings stockpiles 

-- Assessment and planning for the project portfolio, will be undertaken in conjunction with the preparation for the Harlequin work.

Harlequin Underground

As stated within the Company's last announcement, Harlequin underground operations were suspended by the Company in July following communication with the Department of Mines and Petroleum. The critical issues initially related to the maintenance of appropriate training records for mines rescue at Harlequin. However, as the Company's evaluation of Harlequin has progressed, a range of safety and infrastructural issues that require improvement have been identified. These include the condition of ventilation devices, secondary egress and refuge chambers.

Whilst the suspension of production activities at Harlequin is necessary to provide a safe and more reliable platform for Norseman to re-establish production, CNGC's previously stated period of 2-3 months required to recommence Harlequin production is likely to extend. The Company is currently determining the scope, timing and cost of remedial work and will update the market as this is completed.

PRODUCTION

Gold production for the period 1 July 2012 to 27 August 2012 was 3,125 ounces. No production is reported from the Harlequin underground for this period.

CORPORATE

New Appointment

In August 2012, the Company appointed Andrew Matheson to the position of Chief Operating Officer.

Capital raising

The Company has also advised that the settlement of the Tranche 2 placement, as approved by shareholders on 23 August 2012, to unrelated parties introduced by Moelis Australia Advisory Pty Ltd, Ocean Equities Limited and Northland Capital Partners Limited will occur on 27 August 2012. The settlement of the placement to the related parties will occur within the shareholder approval timeframes, Tulla Resources Pty Ltd ("Tulla") has underwritten the full amount of these resolutions.

The Company announced that a new investor will, subject to Foreign Investment Review Board ("FIRB") approval in Australia, subscribe for 100,000,000 Placement shares which would have otherwise been subscribed for by Tulla pursuant to its underwriting obligations. As a result of this commitment, and assuming approval by FIRB, Tulla will hold an aggregate 309,770,083 ordinary shares in the Company, representing 27.73% of the issued share capital.

* * ENDS * *

For further information visit www.norsemangoldplc.com, email [e-mail] or contact:

David Steinepreis Norseman Gold Plc. Tel: [phone]

William Vandyk Northland Capital Partners Ltd Tel: [phone]

Guy Wilkes Ocean Equities Ltd Tel: [phone]

Susie Geliher / Hugo de Salis St Brides Media & Finance Ltd Tel: [phone]

Forward-Looking Statements:

This regulatory news release contains certain forward-looking statements, which include assumptions with respect to future plans, results and capital expenditures. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Please refer to the Company's Admission Document available from the Company's web site for a list of risk factors. The Company's actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive there from. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release.

This information is provided by RNS

The company news service from the London Stock Exchange

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