12 Jul 2012 07:00
HIGHLAND GOLD MINING LIMITED
ACQUISITION OF KLEN GOLD DEPOSIT SUCCESSFULLY CLOSED
12 July 2012 - Further to the announcement made by the Company on 1 June 2012 and following approval of the transaction by the Russian anti-monopoly authorities, Highland Gold Mining Limited ("Highland Gold" or the "Company") is pleased to announce the completion of the LLC Klenacquisition. LLC Klen holds the mining and exploration rights to the Klen gold deposit and the adjacent Verkhne-Krichalskaya property located in the Chukotka autonomous region in north-eastern Russia.
Based on preliminary studies it is envisaged that the Klen gold deposit will be mined by open pit method and employ conventional gravity and cyanidation processing technology. The expected production should range from 50,000 - 60,000 oz of gold per annum with 300,000 - 400,000 tonnes of ore being processed each year, having an average head grade of 5.14 g/t. Plant and mine design work has already been initiated and will target the delivery of initial supplies to commence in August 2012. It is expected that plant construction will follow in 2013 and continue through 2014 with first gold production targeted for 2015. Additional details on preliminary production parameters are available on the Company's website (www.highlandgold.com).
An independent audit, undertaken by Micon International in 2012, evaluated the Klen deposit to contain a JORC compliant geological mineral resource (indicated and inferred) of approximately 0.63 Moz at an average ore grade of 5.04 g/t. The open pit has the potential to be extended along strike and at depth in the course of additional exploration.
At the adjacent 996 km² Verkhne-Krichalskaya licence, the presence of distinct geological features, including wide areas of hydrothermal alteration associated with geochemical anomalies are indicative of the gold prospectivity of the property. Based on previous work and results of the 2011 exploration programme, several exploration targets have already been prioritized which the Company believes have the potential to substantially contribute to Klen's current resource base. The Company is expediting its geochemical programme in 2012 in order to delineate drilling and trenching targets for the 2013 field season and beyond. In-house estimates indicate a significant organic resource growth potential.
For further information please contact:
Highland Gold | Dmitry Yakushkin, Head of Communications + 7 495 424 95 21 |
Duncan Baxter, Director + 44 (0) 1534 814 202 | |
Numis Securities Limited | Alastair Stratton / Stuart Skinner, Corporate Finance - +44 (0) 207 260 1000 |
James Black, Corporate Broking - +44 (0) 207 260 1000 |