AUR RESOURCES INC.
TSX : AUR

AUR RESOURCES INC.

January 23, 2006 17:00 ET

Aur Enters Into Forward Sales Contracts To Ensure Zinc Revenues Exceed The Operating Costs At Its New Duck Pond Copper-Zinc Mine In Newfoundland

TORONTO, ONTARIO--(CCNMatthews - Jan. 23, 2006) - Aur Resources Inc. (TSX:AUR) announces that it has entered into forward sales contracts for 75% of the scheduled zinc production from its wholly owned Duck Pond copper-zinc-silver-gold deposit located in central Newfoundland, Canada. The forward sales contracts total 116,300 tonnes of zinc to be delivered on an equal monthly basis during the period July 2007 through December 2011. The sale prices are $0.842 per pound in 2007, $0.782 per pound in 2008, $0.719 per pound in 2009, $0.671 per pound in 2010 and $0.632 per pound in 2011. The weighted average sales price is $1580 per tonne which is equivalent to approximately $0.716 per pound.

The Duck Pond Mine is currently being constructed and is on schedule to begin production in the fourth quarter of 2006. The Mine is scheduled to produce approximately 41 million pounds of copper and 76 million pounds of zinc annually for a period of 6.3 to 8.0 years.

This hedge transaction has ensured that Aur will receive US$55.5 million of additional revenue from the contracted zinc sales by comparison to the $0.50 per pound zinc price utilized in the feasibility study upon which the decision to develop the Duck Pond deposit was made. This additional revenue is approximately 70% of the total capital development costs of CDN$92 million provided in the feasibility study for Duck Pond. The transaction covers 75% of Aur's planned zinc production from July 2007 through December 2011; the remaining 25% of zinc production during this period, together with all zinc production before and after this period, remains unhedged.

Jim Gill, President & CEO of Aur said that: "As zinc is a by-product metal for Aur, we are taking advantage of the very strong forward zinc prices to enhance Duck Pond revenues and improve the return on our capital investment. We are pleased that the annual zinc revenues alone will now exceed the total mine operating costs with all the copper and precious metal revenues providing additional free cash flow."

Aur Resources is a profitable, Canadian based, mining company with significant copper production from its Quebrada Blanca and Andacollo Mines in Chile, the Duck Pond project in Newfoundland and a commitment to growth through an aggressive international exploration and acquisitions program.

This news release contains forward-looking statements that are based on current expectations and which involve risks and uncertainties, including those referred to in Aur's 2004 Annual Report and/or in Aur's Annual Information Form dated March 31, 2005 and filed with Canadian securities regulatory authorities, that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in the forward-looking statements. Such forward-looking statements include statements regarding financial results and expectations for 2006 and thereafter and include among other things, statements regarding targets, estimates and/or assumptions in respect of metal production and/or metal prices, operating costs, expenditures on property, plant and equipment and production levels and are or may be based on assumptions and/or estimates related to future economic, market and other conditions. Factors that could cause actual results, developments or events to differ materially from those anticipated include, among others, the factors described or referred to in the AIF and include unanticipated and/or unusual events. Many of such factors are beyond Aur's ability to control or predict. Actual results may differ materially from those anticipated. Readers are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein. Aur disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise.

Additional information, including Aur's quarterly and annual Consolidated Financial Statements, AIF, Management Information Circular and other disclosure documents, may also be examined and/or obtained through the Internet by accessing Aur's website at www.aurresources.com or by accessing the Canadian System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedar.com.

Contact Information

  • Aur Resources Inc.
    Dr. James W. Gill
    President and Chief Executive Officer
    416-362-2614
    or
    Aur Resources Inc.
    Mr. John L. Knowles
    Executive Vice-President, Finance and
    Chief Financial Officer
    416-362-2614
    or
    Aur Resources Inc.
    Mr. Edmund J. Stuart
    Vice-President, Development Projects
    416-362-2614
    or visit our web site at www.aurresources.com