4th Quarter Investor Update Announcement

 

 

 

Serabi Mining plc (AIM:SRB) announces that it has today issued a 4th Quarter Investor Update for the quarter ended 31st December 2007.

 

The full text of the quarterly update is available from the Serabi offices at 30 - 32 Ludgate Hill, London, EC4M 7DR or from the website: www.serabimining.com

 

The company has highlighted in its update the following matters:

 

Palito - Operating Results (1)     2007 2006     Q1 Q2 Q3 Q4 YE YE Total Mined (per day) t 55,251 (614) 61,567 (677) 56,903 (619) 56,926 (619) 230,647 (632) 151,239 (414) Mined Ore (per day) t 42,217 (469) 50,058 (550) 45,754 (497) 41,148 (447) 179,177 (491) 132,089 (362) Milled (per day) t 42,705 (475) 45,245 (497) 45,054 (490) 40,481 (440) 173,485 (475) 117,618 (322) Head Grade g/t 6.5 6.0 5.4 5.4 5.8 9.4 Recovery % 89.6 91.1 90.0 89.8 90.1 91.4 Gold oz 8,044 7,888 7,021 5,989 28,982 32,498 Copper t 125.6 127.0 96.2 110.4 459.2 568.9 Gold Equivalent (2) oz 9,301 9,417 8,176 7,069 33,963 39,197

 

 

 

Following a difficult year at Palito in 2007, management's principal focus for the year ahead is to put in place plans to deliver:

(i) reliable, sustainable and profitable production; and
(ii) establish a detailed understanding of and quantify the wider ore potential in the Palito / Jardim do Ouro district.

 

This will be used to determine future expansion potential and support longer-term planning.

As a basis for achieving the company's goals, we have recruited an experienced local management team based in Brazil who will greatly assist with the challenges of underground mining and related management.  This team is already in place to provide a solid foundation for the delivery of our plans.

 

 

 

The principal operating goals for this year are:

 

 

Central to improving operating results at the Palito mine is the introduction of mini-scoops, which will enable us to reduce mine development widths and thus improve the grades delivered to the plant.  The first two mini-scoops are expected to be operational by the end of the first quarter, with another two scheduled for delivery during the second quarter. Additional equipment being added to the mining fleet includes new jumbos and mine trucks.

 

Meanwhile, considerable work has also been carried out to optimise mining techniques at Palito in the future.  It has been concluded that an adaptation of the long-hole stoping method, with reduced stoping heights, will produce best results.  The combination of revised long-holing and the use of mini-scoops for mine development will bring greater selectivity and best grade success.  A robust mine plan based on exploitation of seven lodes, compared with only three last year indicates production for 2008 will rise to between 40,000 and 45,000 gold equivalent ounces.

 

In addition, there are a number of mining opportunities under review at Palito not incorporated into the current 2008 plan.  These opportunities could impact positively on the future production outlook:

 

 

 

 

Various exploration and evaluation programmes that were initiated during the second half of 2007 have been successful and the results are promising; the most exciting results being the identification of high-grade mineralisation at Palito West along with a new series of veins lying between the PMZ and the Chico da Santa structures north-east of the PMZ operation.  Further drilling and development of both of these areas is planned for 2008.  In addition, deep drilling of the northern PMZ is well advanced with the objective of extending resources at depth.

 

Potentially, the most significant exploration activity by the company to date was the 6,000 hectare helicopter-borne EM survey concluded in January.  The results from this programme are expected to have a significant impact on the exploration programme in identifying future ore potential of the area once the results have been interpreted. We hope to provide an initial report on the outcome of the survey before the end of the first quarter.  Based on the success of ground-based EM surveys in identifying a number of mineralised targets at Palito last year, the use of Heli-EM (covering a much wider area) is likely to provide a major breakthrough in this area of the Tapajos, rapidly unlocking areas with good potential close to the established operations but where access might hinder conventional initial evaluation programmes.

 

With these initiatives and opportunities we believe the outcome for 2008 will show a significant operating improvement on 2007, with good exploration prospects set to place Serabi in a strong position for future growth.

 

 

 

 

 

 

Graham Roberts       020 7936 9040                            

Chairman                   Mobile: 07768 902475

 

Mike Hodgson           020 7936 9040

CEO                          Mobile: 07799 473621

 

Clive Line                 020 7936 9040                            

Finance Director         Mobile: 07710 151692                 

 

Investor Relations

E-mail:                       contact@serabimining.com         

Website:                    www.serabimining.com

 

 

John Harrison         Tel: 020 7260 1000

James Black           Tel: 020 7260 1000                        

 

 

 

The Tapajos region of northern Brazil encompasses an area of approximately 100,000 km², primarily situated in south-west Para State.  It has a significant history of alluvial gold production with estimated gold production of some 30 million ounces having being recovered, primarily from artisanal workings.

 

Present in the Tapajos since 1999, Serabi has established the only 'hard rock' mine in the region to date at its Palito gold mine, which produced 39,197 ounces of gold equivalent in 2006 and achieved commercial production at Palito in October 2006

 

Serabi has a significant exploration programme focused on the Tapajos region, owns and operates four surface drilling rigs and has its own assay laboratory.