Avion Gold Corporation
TSX VENTURE : AVR

Avion Gold Corporation

May 06, 2009 11:50 ET

Avion Declares Commercial Production in Mali and Initiates Study to Double Production to 200,000 oz/yr

SEGALA AND TABAKOTO GOLD PROJECTS, MALI

 

TORONTO, ONTARIO--(Marketwire - May 6, 2009) - Avion Resources Corp. (“Avion” or “the Company”)(TSX VENTURE:AVR) today announced that as of May 1, 2009 it has reached “commercial production” at its Segala and Tabakoto Gold Project in Mali.

Avion commenced production on February 17 2009 as planned. Between February 17 and April 30th, the company has:

  • started the crusher and mill, which is now operating at 1,800 tonnes per day, and is ramping up to the budgeted rate of 2,200 tonnes per day.
  • started the Segala Pit with surface waste stripping and processing of ore grade stockpiled “orpeilleur” or artisanal miner workings, and is processing oxide ore from the pit.
  • dramatically lowered operating costs to almost half of budgeted costs by processing the stockpiled ore while developing the Segala pit.
  • reached the fresh ore zone horizon at Segala, and continuous ore feed of this material is being delivered at a rate of 2,200 tonnes per day.
  • signed an earth-moving contract with a Malian Contractor, SFTP, and looks forward to building a long relationship in developing capacity in Mali.

John Begeman, the President and CEO of Avion, stated, “We previously targeted commencing commercial production by July 1, 2009. Avion restarted the crusher, mill, and gold recovery plant in mid-February as planned, and has realized steady, uninterrupted production at average daily rates of 1,800 tonnes (planned maintenance and mechanical availability included) per day for two and a half months. Avion has achieved a sustainable commercial production rate two months ahead of schedule.”

Avion expects total produced gold for 2009 to be 66,000 ounces at a cash cost of US $509 per ounce. Through March 31, 2009, Avion has produced 6,211 ounces of gold, which is over 1,000 ounces ahead of plan at a cash cost of US $423 per ounce.

Mill availability has averaged 96.9% and overall gold recovery has averaged 91.7% on a year to date basis. The following table summarized production statistics through March 31, 2009.

Production Summary as of March 31, 2009
 
  Actual         Budget
 Tonnes Milled76,02473,200
 Gold Produces (oz)6,2115,198

Avion Plans to Expand Production

Avion is currently evaluating the possibility of increasing production throughput by adding plant capacity to its site infrastructure in Mali. Changes to the site infrastructure may include the possible addition of crushing and grinding equipment, and related gold recovery capacity. Engineering studies will begin shortly. The goal of the studies will be to evaluate the ability to:

  • Establish a mine capacity run rate of 100,000 ounces per year by 2010; and
  • Quantify a schedule of equipment required and a mine plan to produce the annual equivalent of 200,000 ounces per year in 2011.

About Avion Resources Corp.

Avion is a Canadian-based gold company focused in West Africa. The Company holds 80% of the Tabakoto and Segala gold projects in Mali. Gold production at these projects has commenced, with approximately 66,000 ounces of production forecast for 2009 with an expected cash cost of US$505 per ounce of gold. Avion has a highly skilled management team, with a focus on growth and consolidation within West Africa.

Andrew Bradfield, the Chief Operating Officer of the Company and a qualified person under National Instrument 43-101, has reviewed the scientific and technical information in this press release.

Cautionary Notes

This press release contains forward-looking statements under Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the development potential and timetable of the Mali projects; the Company’s ability to raise additional funds as necessary; the future price of gold; the estimation of mineral resources; conclusions of economic evaluation (including scoping studies); the realization of mineral resource estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Estimates regarding the anticipated timing, amount and cost of mining at the Mali projects are based on assumptions underlying mineral resource estimates and the realization of such estimates; results of previous mining activities at the projects, and detailed research and analysis completed by independent consultants and management of the Company; research and estimates regarding the timing of delivery for long-lead items; knowledge regarding the factors involved in building a mine and other factors that will be described in the technical report summarizing the scoping study that will be filed under the profile of the Company on SEDAR. Capital and operating cost estimates are based on results of previous mining activities, research of the Company and independent consultants, recent estimates of construction and mining costs and other factors that are set out in the scoping study. Production estimates are based on mine plans and production schedules, which have been developed by the Company’s personnel and independent consultants. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements, including but not limited to risks related to: timing and availability of external financing on acceptable terms; unexpected events and delays during construction, expansion and start-up; variations in ore grade and recovery rates; receipt and revocation of government approvals; actual results of exploration and mining activities; changes in project parameters as plans continue to be refined; future prices of gold; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.

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