Red Back Mining Inc.
TSX : RBI

Red Back Mining Inc.

January 08, 2008 13:02 ET

Red Back Operations Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 8, 2008) - Red Back Mining Inc. (the "Company" or "Red Back") (TSX:RBI) is pleased to provide an update on operations at its gold mines in Ghana and Mauritania.

Gold Production

The Company had record gold production in 2007, producing 127,196 oz at Chirano and 20,812 oz at Tasiast, for total gold production of 148,008 oz. Production levels at both Tasiast and Chirano will increase in 2008 and beyond with expansions at both projects and with the development of the Akwaaba Deeps underground operation at Chirano. It is estimated that the Company will produce approximately 245,000 oz in 2008 (135,000 oz at Chirano and 110,000 oz at Tasiast). For 2009, total production is estimated at 350,000 oz upon completion of the plant expansion projects. By 2010, Red Back is aiming to produce in excess of 400,000 oz per annum from Chirano and Tasiast.

Chirano Plant Expansion

The Chirano plant expansion (News Release: 21 November 2007) is progressing well with some significant milestones having been achieved during the holiday period.

Lycopodium Pty Ltd, the EPCM contractor for the original construction of the Chirano plant, has been awarded an EPCM contract for the plant expansion. The new EPCM contract covers all major work items for the expansion, including an additional ball mill and cyclone cluster, conversion of existing tails thickener to leach feed thickener, the installation of an additional elution column and electrowinning cells and upgrades to tailings pumps, reagent mixing, instrumentation and services. In late 2007, the Company purchased a new ball mill (News Release: 21 November 2007) which will be shipped to Ghana from Australia in the first quarter of 2008.

It is anticipated that the Chirano plant expansion will be completed and commissioned early in the first quarter of 2009.

A separate EPCM contract has been awarded to Sandvik Mining and Construction for the upgrading of the Chirano crushing system. The installation of tertiary crushing will reduce the diameter of the ore feed to the mill, maximizing milling throughput. This installation is expected to be complete by the end of the third quarter. Additional temporary mobile crushing capacity was added at the end of 2007 to provide sufficient mill feed during the period that the new, permanent crushing circuit is constructed.

Akwaaba Deeps Development

The box cut and portal preparation for the decline development at Akwaaba Deeps is well underway with completion expected shortly. Barminco Pty Ltd, a leading Australian underground development company, has been awarded a letter of intent by the Company as the preferred contractor for the underground development at Akwaaba Deeps. Barminco is mobilizing to site, with decline development scheduled to commence in April 2008. It is anticipated that first ore from Akwaaba Deeps will be fed to the plant in the fourth quarter of 2008.

Tasiast Plant Expansion

The Tasiast plant expansion (News release: 3 December 2007) is on schedule. A Project Manager has been appointed and it is anticipated that the expansion will be complete in the fourth quarter of 2008.

Following the successful installation of a new primary crusher in late December 2007, the Tasiast plant has been operating at nameplate capacity for the first time. New secondary and tertiary crushers are expected to arrive on site this month and installation of these crushers will be complete in February. The new crushing system has been sized for the overall plant expansion.

The Heavy Fuel Oil power plant is scheduled to be commissioned by the end of the first quarter. With the introduction of this generating system, power costs are expected to be reduced by more than 50%.

A second ball mill and related equipment for the Tasiast expansion has been ordered and this is scheduled to arrive on site in the third quarter of 2008. At that time the new mill will be integrated into the expansion program.

Exploration

Chirano

Drilling at Chirano is currently focused on infill drilling at Akwaaba Deeps. To date 8 holes (4,272m) have been completed with 5 holes (2,240m) remaining in the program. Recent results continue to confirm the potential of Akwaaba Deeps:



----------------------------------------------------------------------
Hole From (m) To (m) Length (m) Au (g/t) Comment
----------------------------------------------------------------------
CHRC1245D 437.2 474.65 37.45 18.89
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including 437.2 442.6 5.4 9.42
----------------------------------------------------------------------
and 442.6 455 12.4 32.3 Black Breccia
----------------------------------------------------------------------
and 455 474.65 19.65 13.04
----------------------------------------------------------------------
CHRC1251D 550.00 586.65 36.65 13.27
----------------------------------------------------------------------
CHDD1253 341.65 360.00 18.35 2.29
----------------------------------------------------------------------
and 378.60 397.40 18.80 4.07
----------------------------------------------------------------------
and 407.89 425.10 17.21 5.85 ended in
mineralization
----------------------------------------------------------------------
CHRC1257D 607.88 631.84 23.96 3.84
----------------------------------------------------------------------
CHDD1262 234.00 257.10 23.10 4.23
----------------------------------------------------------------------
and 266.60 280.00 13.40 3.39
----------------------------------------------------------------------
and 282.50 296.00 13.50 9.74
----------------------------------------------------------------------
CHDD1265 399.00 457.00 58.00 9.54
----------------------------------------------------------------------
including 428.31 439.70 11.39 30.32
----------------------------------------------------------------------
and including 433.25 437.54 4.29 35.84 Black Breccia
----------------------------------------------------------------------
CHDD1268 304.00 337.00 33.00 7.95
----------------------------------------------------------------------
including 309.56 333.45 23.89 10.30
----------------------------------------------------------------------
CHDD1276 386.00 413.90 27.90 18.46
----------------------------------------------------------------------
including 391.00 394.00 3.00 49.90 Black Breccia
----------------------------------------------------------------------

Note: True width is approximately 75% of drilled width. Hole CHRC1245D
was previously reported in news release dated 21 November 2007.


These new results demonstrate the impressive conversion of inferred resources at Akwaaba Deeps. More significantly, this recent program has again intercepted the very high grade "Black Breccia" which appears to represent a distinct structural unit within the mineralised envelope of Akwaaba Deeps. These new intercepts will allow further detailed targeting of the "Black Breccia" towards a potential further increase in the resources and reserves at Akwaaba Deeps.

A revised Mineral Resource and Ore reserve calculation for Akwaaba Deeps is scheduled for completion before the end of the first quarter 2008.

Tasiast

At Tasiast, the Company is in the process of completing an 18,000m infill drill program on the main resource areas designed to upgrade inferred ounces. To date a total of 12,700m has been drilled with the program expected to be completed by early February.

A revised Mineral Resource calculation for Tasiast is anticipated by March, with a revised Ore Reserve scheduled for the end of the first quarter.

On completion of this program, drilling will move to the West Branch area, 2km south of the Tasiast Plant, where a further inferred resource of 4.7mt grading 1.7g/t (252,000oz) was previously defined (A.C.A. Howe - October 2003). The object is to upgrade and materially add to the resource and to test a newly discovered mineralised footwall zone at this prospect.

About Red Back

Red Back Mining Inc. is an unhedged African focused gold producer. It owns and operates the Chirano Gold Mine in Ghana (90% interest) and the Tasiast Gold Mine in Mauritania (100% owned). Major plant expansions at both Chirano and Tasiast have commenced. At Chirano, the Company is expanding its current operations through development of the Akwaaba Deeps underground mine. At Tasiast, gold production has commenced with commercial production on target for the first quarter of 2008. Red Back is continuing an aggressive exploration program to increase its resource and reserve base at both projects.

This News Release contains forward looking statements which are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward looking statements. The Company does not intend to update this information and disclaims any legal liability to the contrary.

The technical contents of this release have been reviewed by Hugh Stuart, BSc., MSc, a Qualified Person pursuant to NI-43101. Mr. Stuart is the VP - Exploration of the Company and a Member of the Australasian Institute of Mining and Metallurgy. Samples are prepared and analyzed by fire assay using a 50 gram charge at the Analabs facility in Bibiani, Ghana in compliance with industry standards. Field duplicate samples are taken and blanks and standards are added to every batch submitted. Selected samples from this lab are check assayed each month at other Analabs laboratories worldwide.

On Behalf of the Board of Directors:

Richard P. Clark, President

Contact Information

  • Red Back Mining Inc.
    Simon Jackson
    VP - Corporate Development
    (604) 689-7842
    or
    Red Back Mining Inc.
    Sophia Shane
    Investor Relations
    (604) 689-7842
    (604) 689-5452 (FAX)
    Website: www.redbackmining.com