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CHIRANO GOLD MINEJanuary 2008 Gold Production The Company had record gold production in 2007, producing 127,196 oz at Chirano and 20,812 oz at Tasiast, for total gold production of 148,008 oz. Production levels at both Tasiast and Chirano will increase in 2008 and beyond with expansions at both projects and with the development of the Akwaaba Deeps underground operation at Chirano. It is estimated that the Company will produce approximately 245,000 oz in 2008 (135,000 oz at Chirano and 110,000 oz at Tasiast). For 2009, total production is estimated at 350,000 oz upon completion of the plant expansion projects. By 2010, Red Back is aiming to produce in excess of 400,000 oz per annum from Chirano and Tasiast. Chirano Plant Expansion The Chirano plant expansion is progressing well with some significant milestones having been achieved during the holiday period. Lycopodium Pty Ltd, the EPCM contractor for the original construction of the Chirano plant, has been awarded an EPCM contract for the plant expansion. The new EPCM contract covers all major work items for the expansion, including an additional ball mill and cyclone cluster, conversion of existing tails thickener to leach feed thickener, the installation of an additional elution column and electrowinning cells and upgrades to tailings pumps, reagent mixing, instrumentation and services. In late 2007, the Company purchased a new ball mill which will be shipped to Ghana from Australia in the first quarter of 2008. It is anticipated that the Chirano plant expansion will be completed and commissioned early in the first quarter of 2009. A separate EPCM contract has been awarded to Sandvik Mining and Construction for the upgrading of the Chirano crushing system. The installation of tertiary crushing will reduce the diameter of the ore feed to the mill, maximizing milling throughput. This installation is expected to be complete by the end of the third quarter. Additional temporary mobile crushing capacity was added at the end of 2007 to provide sufficient mill feed during the period that the new, permanent crushing circuit is constructed. Akwaaba Deeps Development The box cut and portal preparation for the decline development at Akwaaba Deeps is well underway with completion expected shortly. Barminco Pty Ltd, a leading Australian underground development company, has been awarded a letter of intent by the Company as the preferred contractor for the underground development at Akwaaba Deeps. Barminco is mobilizing to site, with decline development scheduled to commence in April 2008. It is anticipated that first ore from Akwaaba Deeps will be fed to the plant in the fourth quarter of 2008. Exploration Chirano Drilling at Chirano is currently focused on infill drilling at Akwaaba Deeps. To date 8 holes (4,272m) have been completed with 5 holes (2,240m) remaining in the program. Recent results continue to confirm the potential of Akwaaba Deeps:
Note: True width is approximately 75% of drilled width. These new results demonstrate the impressive conversion of inferred resources at Akwaaba Deeps. More significantly, this recent program has again intercepted the very high grade "Black Breccia" which appears to represent a distinct structural unit within the mineralised envelope of Akwaaba Deeps. These new intercepts will allow further detailed targeting of the "Black Breccia" towards a potential further increase in the resources and reserves at Akwaaba Deeps A revised Mineral Resource and Ore reserve calculation for Akwaaba Deeps is scheduled for completion before the end of the first quarter 2008. |
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