• Central Asia Gold lowers 2008 gold production target to 1,000 - 1,100 kg from
previous targeted level of 1,250 kg
• New Tardan deposit reserve calculation ongoing
• Important sample analyses from the Kopylovskoye project due in August -
September
Expected 2008 gold production
As per end of July 2008 nearly half of the production season of Central Asia
Gold's two alluvial production subsidiaries has passed. Thus far they have
produced together approximately 250 kg of gold. This year's production target
for the companies was previously 900 kg. The target will be difficult to reach.
Therefore a new more realistic production target is 750 kg. The lower than
planned production is mainly explained by inflation pressure, primarily in the
Irkutsk region in this case. Sharply increased salary demands have during the
ongoing season resulted in high personnel turnover when workers leave for jobs
with higher salary and/or more comfortable working conditions. This negatively
impacts on production. Also, fuel prices have increased sharply, which has a
negative influence on profitability in primarily the alluvial subsidiaries.
The Tardan mine has during the period January - July 2008 produced some 140 kg
of gold. The 2008 Tardan production target was 350 kg. A new magnetite
separator has recently been commissioned, which is expected to increase monthly
production during the rest of the year. Nevertheless it will be difficult to
achieve 350 kg. The new production target for the Tardan mine is now 300 kg.
In total, the new gold production target of the group for 2008 is therefore
1,000 - 1,100 kg. The previous group production target was 1,250 kg for 2008.
Reserve calculation in respect of Tardan mine
In accordance with previous information a new reserve calculation in respect of
Tardan deposit is ongoing. This calculation must be reviewed and approved by
the Russian authorities (TKZ). The approval consists of reviewing geologic as
well as economic data. The well-known Russian project design institute
IRGIREDMET has been contracted to perform the economic feasibility analysis,
that will be reviewed by the Russian authorities. This work is in progress. The
geologists of Central Asia Gold will submit the figure 9.2 tons of C1-C2
reserves according to Russian standards. IRGIREDMET plans to complete its work
by end of September, at which time TKZ will review both the geologic and
economic data.
The exploration program at Kopylovskoye project
The exploration program at Kopylovskoye deposit is ongoing. In total up to now
some 2,000 samples gathered from surface trenches, core drilling and shallow
pneumatic drilling have been collected. Thereof some 750 samples have been
prepared and sent for analysis to two independent laboratories. The analysis of
these samples taken from four different exploration lines is due in August -
September. The main part of these samples is taken from exploration lines
outside the established ore body. These analyses will give important
indications in respect of the deposit. More information is expected to be given
in the 6-month report due in end of August.
For more information, please contact:
MD Torbjorn Ranta, tel: +46 (0)8 624 26 80, fax: +46 (0)8 624 37 20, mobile
phone: +46 (0)70 8 85 55 04, e-mail: torbjorn.ranta@centralasiagold.se,
Website: www.centralasiagold.se, Post- and visiting address: Brovägen 9, SE-182
76 Stocksund.
Central Asia Gold AB is a Swedish mining company focused on gold production and
exploration in Russia and Mongolia in the central parts of Asia. The gold
production was initiated in late January 2005 and the assets today encompass
some 645,000 troy ounces (1 troy ounce = 31.1 g) of C1/ C2 Russian gold
reserves.
Cautionary Statement: Statements and assumptions made in this report with
respect to Central Asia Gold AB's ("CAG") current plans, estimates, strategies
and beliefs, and other statements that are not historical facts, are
forward-looking statements about the future performance of CAG. Forward-looking
statements include, but are not limited to, those using words such as "may",
"might", "seeks", "expects", "anticipates", "estimates", "believes",
"projects", "plans", strategy", "forecast" and similar expressions. These
statements reflect management's expectations and assumptions in light of
currently available information. They are subject to a number of risks and
uncertainties, including, but not limited to, (i) changes in the economic,
regulatory and political environments in the countries where CAG operates; (ii)
changes relating to the geological information available in respect of the
various projects undertaken; (iii) CAG's continued ability to secure enough
financing to carry on its operations as a going concern; (iv) the success of
its potential joint ventures and alliances, if any; (v) exchange rates,
particularly between the Russian rouble and the U.S. dollar. In the light of
the many risks and uncertainties surrounding any gold production and
exploration company at an early stage of its development, the actual results
could differ materially from those presented and forecast in this report. CAG
assumes no unconditional obligation to immediately update any such statements
and/or forecasts.
