St Andrew Goldfields Ltd.

St Andrew Goldfields Ltd.

September 09, 2009 08:30 ET

SAS Commences Custom Milling Operations at Its Holt Mill

TORONTO, ONTARIO--(Marketwire - Sept. 9, 2009) -


St Andrew Goldfields Ltd. (TSX:SAS) - ("SAS" or the "Company") is pleased to announce it has entered into a custom milling agreement with Apollo Gold Corporation ("Apollo") to process approximately 100,000 tonnes of ore from Apollo's Black Fox mine, at the Company's Holt Mill (which has a processing capacity of approximately 3,000 tpd). The Holt Mill is located at the eastern end of the Company's land package in the Timmins mining district in north-eastern Ontario, Canada.

The Holt Mill has been undergoing minor refurbishment and upgrades in advance of commercial milling of ore from the Company's Holloway Mine expected to commence in the fourth quarter of 2009. Mill upgrades such as installation of a modern mill operating control system, cleaning and testing of all mill motors, mill and bearing alignment and testing, and repair of the electrical components for the refinery furnace are sufficiently advanced to allow the startup of the mill.

"On Saturday September 5, 2009, the mill was smoothly put back into operation", said Jacques Perron, President & CEO of SAS, "and we are pleased to have entered into this agreement with Apollo. The start-up of the mill confirms another important step for the Company's return to gold production in the fourth quarter of 2009. Given the current progress of mine development work at the Holloway Mine, we may be able to start processing our own ore towards the second half of October, which is ahead of schedule."

Mine Development Updates

Pre-production activities at the Holloway Mine are progressing as planned, on schedule and on budget, for mining operations to start in November. The Holloway Mine is expected to produce approximately 15,000 ounces of gold in the fourth quarter of 2009. Currently, there are approximately 20,000 tonnes of production and development ore stockpiled on surface and approximately 65,000 tonnes of production ore drilled off in the mine's Blacktop zone. The backfill infrastructure development is ongoing and scheduled to be completed in November, allowing for full-scale mining operations to commence.

The Company is also finalizing a prefeasibility study for the Hislop property, which is expected to be completed before the end of September 2009. SAS anticipates that ore from the Hislop Project will be trucked to its nearby Holt Mill for processing beginning in early 2010.

SAS is currently evaluating the economics and plans to begin mine preparation activities at its Holt Mine, with an objective to put the mine into production by the second half of 2010. In a decision rendered July 23, 2009, the Superior Court of Justice (Ontario) declared that the Company's obligation and responsibilities in respect of the royalty agreement (the "Holt Royalty") entered into by Newmont Canada Limited ("Newmont") and Barrick Gold Corporation on the Holt property, is limited to a small NSR royalty (please refer to press release dated July 24, 2009). Newmont has since filed a notice of appeal of the Court's decision. SAS remains confident that its position and the decision of the Court will be upheld if the appeal process is pursued by Newmont to its conclusion. The date of any appeal hearing has not as yet been determined.

About SAS

SAS (operating as SASGoldmines), is a Canadian based gold mining, and exploration Company with an extensive land package in the Timmins mining district, Northeastern Ontario, Canada, which lies within the world famous Abitibi greenstone belt. With near-term production and 120 km of upside exploration potential along the Porcupine-Destor Fault Zone, SAS is focussed on building a foundation for profitable growth.


This news release contains forward-looking information and forward-looking statements (collectively, "forward-looking information") under applicable securities laws, concerning the Company's business, operations, financial performance, condition and prospects, as well as management's objectives, strategies, beliefs and intentions. Forward-looking information is frequently identified by such words as "may", "will", "plan", "expect", "anticipate", "intend" and similar words referring to future events and results, including in respect of SAS's return to being a gold producing company and the timing thereof, initially at the Holloway Mine and subsequently with the development of the Hislop Project and the development and restart of the Holt Mine; the level of gold production for 2009; the completion of a prefeasibility study on the Hislop property and the anticipated positive production decision thereafter; and the outcome of the appeal of the Court decision on the Holt Royalty. This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information. Factors that may cause actual results to vary materially include, but are not limited to, uncertainties relating to the interpretation of the geology, continuity, grade and estimates of the mineral resources, unanticipated operational or technical difficulties, delay or inability to raise additional financing on satisfactory terms, fluctuations in gold prices and exchange rates, changes in laws or regulations, the risks of obtaining necessary licenses and permits, changes in general economic conditions, changes in conditions in the financial markets and an adverse appeal Court decision on the Holt Royalty. Readers are cautioned not to place undue reliance on this forward-looking information as actual results may differ materially from those expressed or implied in the forward-looking information. SAS does not assume the obligation to revise or update this forward-looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.

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