Kinbauri Gold Corp.
TSX VENTURE : KNB
FRANKFURT : 3KG.DE

Kinbauri Gold Corp.

May 29, 2009 09:21 ET

Kinbauri Receives Validation of Revised Mine Plan From Independent Consultant

 OTTAWA, ONTARIO--(Marketwire - May 29, 2009) - Kinbauri Gold Corp. ("Kinbauri") ( TSX VENTURE:KNB)(FRANKFURT:3KG.DE), further to its press releases of May 11th and May 12th, 2009, is pleased to announce that Scott Wilson Mining . ("SWM") has completed its review of Kinbauri's revised mine plan for the El Valle/Carlés Project (the "Project") which: 
 

  • Advances the date of first gold pour to 12 months from the start of development.
  • Significantly reduces pre-production capex.

The revised plan was prepared by Kinbauri based on the Scoping Study by SWM, filed on April 20th, 2009 ("the Scoping Study").  SWM concluded that there are no fatal flaws to the revised mine plan completed by Kinbauri. The following table compares key assumptions and results from the Scoping Study and Kinbauri's revised plan;

Item Revised Plan (May/09) Scoping Study (April/09)
Portal location Open pit high wall Adjacent to mill
Decline gradient 15% 12%
Decline length (metres) 560 870
Initial stopes A107 (upper) A107 (lower) and San Martin
Mined resources (tonnes) 6,138,178 6,331,344
Payable Cu (M lb) 83.4 86.6
Payable Au (oz) 857,817 876,750
Combined Revenue (M €) 608.6 624.3
Total Capital cost (M €) 95.3 91.4
Life of Mine Operating cost (M €) 289.4 296.8
Pre-production Capital cost (M €) 40.2 67.5
Capital cost (M €) 95.3 91.4
Total Operating cost (M €) 289.4 296.8
Total cash cost per Ounce AuEq (€/oz) 254.71 261.63
Date of First Revenue 12 months from start 23 months from start
Pre-tax NPV (@10%) (M €) 70.2 68.6

The revised plan provides early access to the top of the 107 Area ("A107") with the result that a larger proportion of high grade ore will be processed in the early stages of the Project. The Upper A107 was scheduled for mining at a later time in the Scoping Study's mine life, as mineralization in this area is classified as Inferred.  The revised plan, has  allowed for upgrade drilling to convert the A107 mineralization to Indicated, as well as an allowance for test mining.  Successful upgrading of the A107 Inferred material is key to the success of the revised plan. Initial production from A107 will be supplemented with ore from the present decline and with production from the re-opened Carlés underground mine.

Cautionary Statement as Required by NI 43-101, Sect 2.3 (3): These assessments are preliminary in nature; they include Inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary assessments will be realized because mineral resources that are not mineral reserves do not demonstrated economic viability. 

Dr. Rampton, Kinbauri's President and CEO, commented "We are extremely pleased that Scott Wilson has verified the viability of the revised mine plan that our engineering team developed subsequent to receipt of the Scoping Study.  Reduction of the pre-production capex in combination with funds to be provided by the Glen Eagle transaction significantly reduces the need for future financing. The Project can look forward to production in 2010 with robust annual after-tax cash flows

This press release has been prepared by Dr. Vern Rampton, P. Eng., President and CEO in his capacity as a qualified person.  Dr. Rampton will record a "Beyond the Press Release" webcast concerning the  revised mine plan at El Valle/Carlés on Kinbauri's Investor Relation site at http://www.agoracom.com/IR/kinbauri on May 29th. This release has also been reviewed and approved by SWM.

About Kinbauri:

Kinbauri is a TSXV – Tier 1 Mineral Exploration Company focused on the development of precious metal prospects in Spain, Nevada and Canada.  Its immediate focus is to begin operations at its El Valle/Carles property in Asturias, northwestern Spain in 2010. It currently has 59,348,051 common shares issued and outstanding. 

THIS PRESS RELEASE WAS PREPARED BY KINBAURI GOLD CORP.  THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

This press release contains certain forward-looking statements, which are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected.  Kinbauri undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change.  The reader is cautioned not to place undue reliance on forward-looking statements.

OR VISIT:

Kinbauri Gold's Hub at http://www.agoracom.com/IR/kinbauri  where investors can post questions and receive answers or review questions and answers already posted by other investors.  Kinbauri Web-Site: www.kinbauri-gold.com

THIS PRESS RELEASE WAS PREPARED BY KINBAURI GOLD CORP. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

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