Red Back Mining Inc.
TSX : RBI

Red Back Mining Inc.

September 07, 2005 14:13 ET

Red Back Chirano Gold Mine Update

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 7, 2005) - Red Back Mining Inc. (TSX:RBI) (the "Company") is pleased to provide an update on the development of its Chirano gold mine located in Ghana, West Africa.

The primary crusher at Chirano started operations on September 6, 2005. This will immediately be followed by the commissioning of the SAG and Ball mills. Commercial gold production is anticipated in early October, 2005.

As at August 31, 2005 the construction status at Chirano is as follows:

Plant and Infrastructure

- Project Design and Engineering 100% complete

- All major construction contracts awarded

- Procurement 98% complete, with the focus now on spares and logistics

- Concrete work is complete

- Plant offices are complete

- Leach tanks are complete

- Ball Mill + SAG Mill and motors are in place with commissioning scheduled for first week of September

- Primary crusher is complete with commissioning in the first week of September

- Overland power line is connected

- Water Storage Facility is complete and ready for plant start-up

- Site earthworks complete

- Tailings Storage Facility - main embankment complete

- Tailings and water overland piping 70% complete

- Commissioning Manager is on site and pre-commissioning has commenced

Mining

Mining operations at the Obra, Obra South and Tano pits at Chirano are ahead of schedule. The mined ore currently stands at 297,996 tonnes, containing 16,765 ounces of gold. Grade control and mining continues to show a material improvement over projections in the Bankable Feasibility Study ("BFS"), with an overall 18% increase in ounces to date.



Completed Ore Blocks - August 2005

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DEPLETED MINED
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Exploration Reserve Grade Control
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Density Tonnes g/t Ounces Density Tonnes g/t Ounces
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Obra 1.72 265,326 1.66 14,136 1.92 291,575 1.75 16,448
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Tano 1.72 1,423 1.53 70 1.57 6,421 1.54 317
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Total - 266,749 1.66 14,207 - 297,996 1.75 16,765
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VARIANCE
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% Difference
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Tonnes g/t Ounces
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Obra 10% 6% 16%
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Tano 351% 0% 352%
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Total 12% 6% 18%
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With continued mining and an extensive ongoing grade control drilling program, a reconciliation of reserves will be completed and restated by year end against revised gold pricing; the BFS was calculated on a gold price of US$375 per ounce.

Capital Cost

Nearing completion, the capital cost of Chirano has remained at US$73.4 million. A recently announced private placement of CDN$11.9 million (News Release July 11, 2005) completed the necessary funding for commencement of production at Chirano.

Rick Clark, President of Red Back, commented, "We're ever closer to our first gold pour. Early October should see the start of commercial gold production from the Chirano mine. This project keeps getting better - not only has the development gone smoothly but our exploration and resource definition drilling has hinted strongly at the expansion potential of the mine. High grade gold has been intersected below and on strike with the known Chirano deposits - a scenario typical of other gold mines in the region as they are developed and continue to grow."

The Chirano Gold Project is located in Ghana, West Africa with proven and probable reserves of 17.8 million tonnes grading 1.9 g/t gold for approximately 1.09 million ounces contained gold (RSG Global - December, 2004) There is significant resource and reserve upside through both brownfields and greenfields exploration. The Chirano Project is within the Bibiani gold belt 25 kms along strike from AngloGold Ashanti's (+5 million ounces) Bibiani gold mine. In addition to Chirano, the Company retains one of the largest mineral land positions in Ghana (5,000 sq. kms) and is systematically exploring this land holding.

The technical contents of this release have been reviewed by Ross Ashton, BSc, FAusIMM, a Qualified Person pursuant to NI-43101. Mr. Ashton is a Director of the Company. Samples are prepared and analyzed by fire assay using a 50 gram charge at the Analabs facility in Bibiani, Ghana in compliance with industry standards. Field duplicate samples are taken and blanks and standards are added to every batch submitted. Selected samples from this lab are check assayed each month at other Analabs laboratories worldwide.

On behalf of the Board of Directors

Richard P. Clark, President


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