MDN Inc.
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MDN Inc.

January 25, 2007 10:30 ET

MDN Northern Mining: Tulawaka Mine Produces 139,655 Ounces of Gold in 2006

MONTREAL, QUEBEC--(CCNMatthews - Jan. 25, 2007) - MDN NORTHERN MINING (Minieres du Nord or "MDN")(TSX:MDN) is pleased to announce that the Tulawaka Mine in Tanzania produced 36,944 ounces of gold in the fourth quarter ended December 31, 2006. Tulawaka gold production amounts to a total of 139,655 ounces, about 12% higher than the 2006 budget, and 264,362 ounces since the beginning of production in March 2005.

In 2006, the plant facilities processed 500,181 tonnes of ore at an average grade of 9.18 g/t gold and a gold recovery of 94.7%. The annual total cash costs averaged US$279 to produce an ounce of gold, compared with US$286 in the budget.

During the year, a total of 146,493 ounces of gold have been sold, entirely in the spot market, at an average price of US$606/oz, for gross revenues of US$88.7 million, about US$26.4 million higher than the budget. The gross profit was US$32.9 million, compared with a budget of US$9.7 million.

With these excellent results, the Tulawaka Mine distributed a cumulative amount of US$33 million to the joint-venture participants in 2006, 70% to Pangea Goldfields and 30% to MDN; MDN's share of distributions was applied entirely to the reduction of its debt.

The Tulawaka Mine has now registered more than 6 million man-hours worked without a single lost-time accident. 239 persons are currently employed at the Tulawaka Mine, of which 216 are Tanzanian.

Other Projects in Tanzania

Of the 25 licenses controlled by MDN in the Tulawaka area, five were abandoned at the end of 2006. On the 20 remaining licenses, which total more than 700 km2, four gold discoveries were announced during the last months, namely :

- Isambara (40 km2) located 28 km north of the Tulawaka Mine. Encouraging drilling results : 10.42 g/t gold over 11 m; 11.98 g/t over 6 m; 14.93 g/t over 5 m; and 15.53 g/t over 8 m. Priority target in 2007 with complementary geophysical surveys and additional drillings. Partnership : MDN 70% - Jope Business Associates 30% (Lakota Resources holds a 50% interest in Jope).

- Viyonza (103 km2) located 15 km north of the Tulawaka Mine. Encouraging drilling results : 35.95 g/t gold over 2 m; 17.15 g/t over 3 m; 7.27 g/t over 9 m; and 13.34 g/t over 4 m. Priority target in 2007. Project held at 100% by MDN under option from Tanzanian Royalty Exploration Corporation.

- Isozibi (82 km2) located 17 km northwest of the Tulawaka Mine. Large geophysical anomaly of 1 000 m X 900 m with interesting initial drilling results including 4.40 g/t gold over 2 m. Structural analysis in 2007 following by possible drilling campaign. Partnership: MDN 65% (under option from Tanzanian Royalty Exploration Corporation) - Jope Business Associates 35%.

- Mnezeki (110 km2) located 20 km east of the Tulawaka Mine. Most recent discovery with initial drilling result of 30.1 g/t gold over 6 m. Geophysical survey and drillings planned for 2007. Project held at 100% by MDN under option from Tanzanian Royalty Exploration Corporation.

In addition, the Msasa gold project discovered by African Eagle and for which MDN has signed an option agreement, remains active with drilling results obtained by MDN in 2006 of 8.26 g/t gold over 2 m and 2.51 g/t over 5 m.

In view of the results of the Tulawaka Mine, combined with an excellent portfolio of gold projects controlled by MDN around Tulawaka, management of MDN is very confident in the future of its projects and intends to pursue significant exploration work programs to increase their value.

The Tulawaka project is a joint-venture between MDN Northern Mining (30%) and Pangea Goldfields (70%), a wholly owned indirect subsidiary of Barrick Gold Corporation and project operator through its Tanzanian subsidiary Pangea Minerals Ltd. The information concerning Tulawaka Mine in this press release was provided by the project operator. As for the exploration programs conducted by MDN, they are realized under the supervision of geologist Dominique Fournier, Ph.D., who is the qualified person in accordance with NI 43-101.

Contact Information

  • MDN NORTHERN MINING
    Paul-A. Girard, Executive Chairman
    Dominique Fournier, Ph.D., Vice-President Exploration
    Dominique Moreau, Treasurer
    514-866-6500
    info@xnord.com / www.xnord.com