Project Update

23 Jan 2006 14:00

Caledonia Mining Corporation23 January 2006 Caledonia Mining Corporation Caledonia Commissions Plant Expansion at Barbrook Gold Mine Toronto, Ontario - January 23, 2006: Caledonia Mining Corporation ("Caledonia")(TSX: CAL, NASDAQ-OTCBB: CALVF, AIM: CMCL) is pleased to announce the completionand commissioning of the metallurgical plant expansion at its wholly ownedBarbrook gold mine in South Africa. The expansion project effectively more than doubles the plant milling capacityand includes crushing, primary milling, flotation, carbon removal, ultra-finegrinding, oxidation and resin-in-leach circuits. Stefan Hayden, President and CEO of Caledonia, said "The plant expansion willenable Barbrook to increase its gold production target to 22,0000 ounces perannum for the 2006 financial year and take advantage of the current high goldprice and positive investor sentiment towards the metal. The mine's undergrounddevelopment program has identified substantial additional and accessible oresources which will provide sufficient mining flexibility to meet the increasedmilling target of 18,000 tonnes per month" Caledonia continues to be unhedged and debt free. Further information regarding Caledonia's exploration activities and operationsalong with its latest financials may be found at www.caledoniamining.com. For more information, please contact: Stefan Hayden Alex Buck / Nick BiasPresident and CEO, Caledonia Mining buck-biasTel: +27 11 447 2499 Tel: +44 7932 740 452 Certain statements included herein are "forward-looking statements". Managementcautions that forward-looking statements are not guarantees and that actualresult could differ materially from those expressed or implied in theforward-looking statements. Important factors that could cause the actualresults of operations, exploration or development programs, or the financialcondition of the Company, to differ include, but are not necessarily limited to,the risks and uncertainties discussed in documents filed by the Company with thevarious regulatory authorities having jurisdiction. This information is provided by RNS The company news service from the London Stock Exchange