Golden Band Resources Inc.

Golden Band Resources Inc.

August 03, 2006 12:13 ET

Golden Band Resources Update

SASKATOON, SASKATCHEWAN--(CCNMatthews - Aug. 3, 2006) - Golden Band Resources Inc. (the "Company") (TSX VENTURE:GBN) is pleased to provide an update on its current and planned activities. The Company's scoping study on the Greater Waddy Lake central mill is in progress by the independent firm, P&E Mining Consultants Inc. ("P&E"). As reported in the Golden Band news release of August 15, 2005, this study is based on the four gold deposits in the Greater Waddy Lake-area for which the Company has NI 43-101-compliant resource estimates (Golden Heart, Komis, Tower East, and Memorial) and was predicated on the building of a new 1,500 tonne per day mill near Tower Lake. P&E has provided initial indications to the Company that the Company's stated plan to re-start production using its existing Jolu mill instead of building a new mill is the preferred option to achieve near-term gold production.

P&E indicated that building a new mill in the Greater Waddy lake area could result in a cash operating cost in the order of Cdn$455 per ounce and estimated life-of-mine capital costs in excess of $72 million which at a 10% discount rate could have a negative net present value and internal rate of return. While significant improvements could result from the optimization of this development model and completion of the study, the Company, in discussions with its consultants, has decided that it will be more beneficial to investigate alternatives to the development model. As a result, the focus of the scoping study will be changed to consider the economics of the project using the Jolu mill as well as other options as discussed below.

The Company considers the central mill concept will remain as a realistic long-term target for the Greater Waddy Lake area but in the immediate term, that greater benefit may result from production through the Jolu Mill. The initial indications from P&E have reinforced the potential value of utilizing the Company's existing infrastructure in the La Ronge Gold Belt. Golden Band will continue with its existing plan to commence underground exploration of the Bingo deposit and will also focus on additional potential sources of higher-grade mill feed within the area. An example of this is the Komis deposit that was developed by the previous owner as an underground mine in 1996 and shut down after one-year due to low gold prices and grade control issues. Reopening the underground access at Komis will be considered in the next study in order to assess open pit alternatives versus underground mining of higher-grade zones that were previously developed for production.

Business Strategy Update

Ron Netolitzky, Golden Band's president, notes "With the rapid increases we have seen in costs related to equipment, materials and energy since we commissioned the scoping study, we are not entirely surprised that these have affected our original development plans. Fortunately, our known gold deposits offer us the flexibility to consider alternative development options. Also, our on-going exploration portfolio, including the recently discovered Birch Crossing deposit, will allow us to focus on the discovery and delineation of additional higher-grade mineralization, both in the Greater Waddy area and in the Bingo and Jolu areas. We are optimistic that potential for development continues to exist, and we have requested P&E to re-orient the scoping study to these alternative scenarios."

Factors to be included in P&E's revised scope of work are the development of a lower-tonnage higher-grade option. This will consider incorporating additional historical deposits that the Company owns within the region (Niko, Kaslo, and Corner Lake), and the recently discovered and apparently higher-grade Birch Crossing deposit (see news release of April 11, 2006). Birch Crossing will require at least one further drill program to permit the calculation of a preliminary resource estimate. That drilling will start in August and will take approximately one-month to complete. The other deposits have abundant historical drilling and will be updated to NI 43-101 resource status. All the deposits will be modelled at various cutoff grades and strip ratios to support flexible development approaches. Potentially excessive grade capping of high-grade assays may have had a significant effect on the gold content estimates of the deposits and this aspect will also be the subject of a rigorous review by Golden Band.

Near-Term Production Potential

P&E's initial indications reinforce Golden Band's long-held plans to advance near-term production from its high-grade Bingo deposit using the Company's Jolu mill. A tender for an underground exploration program on the Bingo deposit, and Komis if warranted, will be made as soon as is practical. This work would require at least one-year to complete. In addition, a consultant has been engaged to prepare the application to the province to construct and conduct the Bingo underground bulk sample program and for the re-starting of the Jolu mill and its tailings facility.

Additional Mill Feed Strategy

Again in keeping with the Company's existing plans to supplement the feed for the Jolu mill from the Bingo deposit, Golden Band will continue to pursue other high-grade deposits within trucking distance of the mill both on its property and that are currently held by others. Deposits owned by Golden Band that are being considered as potential sources for higher-grade mill feed include Komis, Tower East, EP, Memorial, and perhaps Birch Crossing.

Jolu Mill

In preparation for the eventual re-start of gold production at the Company's 100%-owned Jolu mill, a consultant has been hired to undertake a detailed assessment of the mill's operating equipment.

Environmental Baseline Study

An environmental baseline study has been commissioned that updates the existing data available in the Greater Waddy Lake-area and for the Jolu mill, and will include the Company's newly discovered Birch Crossing deposit and the route of a possible road between the Greater Waddy-area and the Jolu mill. This work will start in the fall of 2006 and will require one-year to complete.

Summer Exploration Program Update

The summer exploration program described in news releases made on June 5 and 28, 2006 is underway. Follow-up drilling was completed in the Charlie's Eye prospect-area at the end of July. Follow-up drilling is now underway on the EP deposit (see news release of September 8, 2005). Follow-up drilling on the Birch Crossing deposit (see news releases of April 11, March 2, and February 27, 2006) will start in mid-August. Some 3,000 metres are planned and will require at least one-month to complete. Once this work is completed, if warranted, a resource estimate will be prepared for the Birch Crossing deposit.

On behalf of the Board of Directors,

Ronald K. Netolitzky, President

All of Golden Band's exploration programs and pertinent disclosure of a technical or scientific nature are prepared by or prepared under the direct supervision of Klaus Lehnert-Thiel, P.Eng., P.Geo., Golden Band's Vice President of Exploration, who serves as the qualified person (QP) under the definitions of National Instrument 43-101.

Forward-Looking Statements: Some of the statements in this news release contain forward-looking information that involves inherent risk and uncertainty that may affect the business of Golden Band Resources Inc. Actual results may differ materially from those currently anticipated in such statement.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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