Desert Sun Mining Corp.
TSX : DSM
AMEX : DEZ

Desert Sun Mining Corp.

January 25, 2006 04:00 ET

Desert Sun Increases Reserves at Jacobina by 25% to 1.5 Million Ounces Gold

TORONTO, ONTARIO--(CCNMatthews - Jan. 25, 2006) - DESERT SUN MINING CORP. (TSX:DSM)(AMEX:DEZ) has increased mineral reserves by 25% through an updated mineral reserve estimate for its Jacobina Mine (Joao Belo Zone), Morro do Vento Mine, Morro do Vento Extension zone and Serra do Corrego zone. This increase is based on the updated estimates of Measured and Indicated mineral resources released on December 20, 2005.

Proven and probable mineral reserves in the Jacobina Mine (Joao Belo Zone) are now 13,220,000 tonnes grading 2.15 g Au/t containing 913,100 ounces of gold. Total Proven and Probable mineral reserves in all zones are now 21,580,000 tonnes grading 2.18 g Au/t containing 1,510,000 ounces as summarized in Table 1 below. This is an increase of 310,000 ounces from the August 2005 reserve estimate (see press release August 11, 2005).

This new reserve estimate is now being used in the Jacobina Mine development plan and increases mine life by over three years. A pre-feasibility study is currently in progress for the Canavieiras Mine, which has the potential to further increase reserves.

"This reserve increase represents another milestone in our growth plan as we head towards our target production of 250,000 ounces of gold in 2009," commented Bruce Humphrey, President and Chief Executive Officer. "Other significant events coming up this year include completion of the Morro do Vento Extension pre-feasibility expansion study and the Canavieiras pre-feasibility study, both of which have the potential to make significant contributions to our reserves."

"The 25% increase to 913,100 ounces from the August 2005 estimate of 727,000 ounces in Proven and Probable reserves for the Jacobina Mine - Joao Belo Zone - allows us to further extend the mine life of our primary ore zone," commented Peter Tagliamonte, Vice President, Operations and Chief Operating Officer. "This new estimate at Joao Belo contains a contribution from the newly discovered FW (Footwall) Reef in the main ore zone. The exploration drilling program at Joao Belo in 2005 outlined inferred mineral resources totaling 1,235,000 ounces and our expectation is that a significant portion of this resource can eventually be upgraded to a reserve based on historical and recent experience."

- The mineral reserve estimate is set out in Table 1 below. The reserves were estimated using a gold price of US$400 per ounce and a block cutoff grade of 1.41 grams gold per tonne. Dilution and mining recovery rates appropriate for each zone were applied following established practices at the mine. Desert Sun has all operating permits in place for production. A NI 43-101 report on the updated mineral resources and mineral reserve estimate will be filed on SEDAR.



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Table 1:
Estimated Mineral Reserves as of January 20, 2006(1)
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Proven &
Area Proven Probable Probable
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g g g
Tonnes Au/t Tonnes Au/t Tonnes Au/t Ounces
Contained
---------------------------------------------------------------------
Joao
Belo(2) 3,007,000 2.18 10,215,000 2,14 13,220,000 2.15 913,000

---------------------------------------------------------------------

Morro
do
Vento(4) Nil Nil 4,672,000 1.95 4,672,000 1.95 292,000
---------------------------------------------------------------------

Morro
do
Vento
Ext.
(Basal
Reef)(3) 58,000 3.57 2,712,000 2.68 2,770,000 2.69 240,000
---------------------------------------------------------------------

Serra
de
Corrego(3) Nil Nil 918,000 2.17 918,000 2.17 64.000

---------------------------------------------------------------------

Total(5) 21,580,000 2.18 1,510,000
---------------------------------------------------------------------

(1) Mineral reserves have been classified in accordance with CIM
standards under NI 43-101.
(2) Desert Sun Mining mineral reserve estimate January 20,2006
(3) Updated following original Dynatec mineral reserve estimation of
September 2003 in the SNC Lavalin feasibility study (see DSM
Press Release September 12, 2003).
(4) Desert Sun Mining mineral reserve estimate August 11, 2005
(reviewed by Devpro Mining Inc.) (see DSM Press Release
August 11, 2005).
(5) Totals have been rounded.


"Desert Sun has a proven track record of successfully converting approximately 75% of Inferred resources into Indicated resources by further drilling," commented Mr. Humphrey. "Based on operating experience, the conversion rate of Measured and Indicated resources to Proven and Probable reserves is typically about 75%."

Assaying for the drilling program which defined the new indicated mineral resources in the Morro do Vento Extension zone was carried out by Lakefield Geosol, an ISO 9001, 2000 laboratory based in Brazil, using fire assay on 50 gram pulps. Check assaying is routinely carried out, by ALS Chemex in Vancouver, on 10% of sample pulps and 5% of sample rejects. Independent standard reference samples are also inserted at regular intervals into each batch of analyses. Security is maintained at the core logging and sampling facility. Dr. Bill Pearson, P.Geo. is the Qualified Person as defined under National Instrument 43-101 responsible for the scientific and technical work on the exploration program.

Assaying for the production drilling and channel sampling at the Jacobina Mine (Joao Belo zone) was carried out at the mine site laboratory which is an independent laboratory operated for the Jacobina mine by SGS Lakefield Geosol, an ISO 9001, 2000 laboratory based in Brazil, using fire assay on 50 gram pulps. Blanks, duplicates and independent standard reference samples are inserted at regular intervals into each batch of analyses. The mine laboratory uses the full SGS QA/QC protocols and participates in regular intra-laboratory checks. Security is maintained at the core logging and sampling facility. Peter Tagliamonte, P.Eng., is the Qualified Person as defined under National Instrument 43-101 responsible for all mining and engineering work at the Jacobina Mine. Dr. Bill Pearson, P.Geo. is the Qualified Person as defined under National Instrument 43-101 responsible for the geoscientific and technical work.

The Measured and Indicated resource estimate upon which these new reserve estimates are based was reviewed and confirmed by Terry Hennessey, P.Geo. of Micon International. Mr. Hennessey, who is an independent qualified person as defined under National Instrument 43-101 as reported in the press release dated December 20, 2005. The resource estimation methodology and classification used is the same as outlined in the August 2003 report by Mr. Hennessey filed on SEDAR. The updated mineral reserve estimate was completed by the DSM Mining Group at Jacobina under the direction of Mr. Tagliamonte, P.Eng., who is a Qualified Person, as defined by National Instrument 43-101. An NI 43-101 compliant report on the mineral reserves and mineral resources will be filed on SEDAR following the issue of this press release.

Desert Sun Mining is a Canadian gold mining company listed on the Toronto Stock Exchange and the American Stock Exchange with 100% ownership of the Jacobina Mine and the 155 km long Bahia Gold Belt in the state of Bahia, in northeastern Brazil. Proven and Probable mineral reserves in the Jacobina Mine area are 21,580,000 tonnes grading 2.18 g Au/t containing 1,510,000 ounces. As a result of Desert Sun's exploration programs to date, Measured and Indicated resources total 27,900,000 tonnes grading 2.57g Au/t containing 2,311,000 ounces of gold and Inferred Resources total 33,600,000 tonnes grading 2.80g Au/t containing 3,029,000 ounces of gold. The mineral reserves are included within the Measured and Indicated mineral resources. For additional information, contact Naomi Nemeth, Vice President, Investor Relations at 416-861-5901 (info@desertsunmining.com) or visit Desert Sun's website at www.desertsunmining.com.

Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward-looking statements". This news release also uses the terms "measured resources", 'indicated resources' and 'inferred resources'. Desert Sun Mining Corp. advises investors that although these terms are recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize them. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves. In addition, 'inferred resources' have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, or economic studies except for Preliminary Assessment as defined under 43-101. Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.

Contact Information

  • Desert Sun Mining Corp.
    Naomi Nemeth
    Vice President, Investor Relations
    (416) 861-5901
    1 (866) 477-0077
    www.desertsunmining.com