St Andrew Goldfields Ltd.

St Andrew Goldfields Ltd.

November 14, 2007 16:01 ET

St Andrew Reports 2007 Q3 Financial Results

OAKVILLE, ONTARIO--(Marketwire - Nov. 14, 2007) - St Andrew Goldfields Ltd. (TSX:SAS) ("St Andrew" or the "Company") - For the three-month period ended on September 30, 2007, St Andrew reported a net loss of $24,036,610 or $0.48 per share, as compared to a loss of $24,637,341 or $0.59 per share for the same period in 2006. Net loss for the nine months ended September 30, 2007 was $62,154,948 or $0.66 per share as compared to a loss of $39,966,999 or $1.06 per share for the same period in 2006.

St Andrew's accounting policy requires all exploration and mine development expenditures prior to the establishment of economically recoverable reserves at a property be charged to operations. When the Company has determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, costs incurred to develop the property are then capitalized. Subject to the review of the Company's Nixon Fork Gold Mine, none of the Company's exploration and mine development projects have established that there are economically recoverable reserves.

Results of Operations

Three months ended Nine months ended
September 30, September 30,
2007 2006 2007 2006
Amounts in thousands of Canadian dollars,
except per share and per ounce amounts

Tonnes mined 5,648 21,244 69,734 79,018
Tonnes milled 3,630 21,743 85,646 68,692
Gold grade (grams per tonne) 8.7 5.8 5.6 5.0
Mill recovery rate (percent) 73.0 87.6 82.5 93.2

Gold production (ounces) 874 3,521 10,789 10,533
Gold sold (ounces) 2,029 3,671 10,838 13,069
Realized price per
ounce (US$) $ 696 $ 616 $ 680 $ 594

Gold sales $ 1,436 $ 2,549 $ 8,030 $ 8,685
Net loss $ 24,037 $ 24,637 $ 62,155 $ 39,967
Net loss per share $ 0.48 $ 0.59 $ 0.66 $ 1.06

Working capital deficit $ 59,505 $ 13,990
Shareholders' equity $ 61,355 $ 21,367
Number of shares outstanding 189,568,145 41,872,053

Consolidated gold production was significantly below the Company's expectations and projections due to the temporary shutdown of the milling operations at the Company's Nixon Fork Gold Mine during the third quarter of 2007 to allow for the then planned installation of tailings filtration equipment and the integration of the dry stack tailings facility. On October 10, 2007, the Company announced the temporary suspension of mining, development and milling operations at its Nixon Fork Gold Mine to better define the mineral resources at the mine. Gold production from the Company's Stock Gold Complex had also been temporarily suspended since May 2007 to allow the Company to focus its efforts in the near term on the exploration and development of the Holloway-Holt Mine.

Nixon Fork Gold Mine

Quarters ended Nine months ended
September 30, June 30, March 31, September 30,
2007 2007 2007 2007

Tonnes mined 5,648 21,244 69,734 79,018
Tonnes mined 5,648 6,710 5,747 18,105
Tonnes milled 3,630 7,433 8,198 19,261
Gold grade (grams per tonne) 8.7 16.0 21.8 17.1
Mill recovery rate (percent) 73.0 70.5 76.4 73.5

Gold production (ounces) 874 2,661 3,240 6,775
Gold sold (ounces) 2,029 4,232 380 6,641

By-product produced:
Copper (pounds) 38,037 22,884 26,706 87,627
Silver (ounces) 1,671 1,341 728 3,740

Comparable figures for the quarter and the nine months ended September 30, 2006 are not available as the Nixon Fork Gold Mine commenced mining operations in January 2007.

For the nine months ended September 30, 2007, the Company achieved a head grade of 17.1 grams per tonne (g/t) from the mining of 18,105 tonnes of ore from the upper portion of the 3300 zone of the Crystal deposit. The result is substantially different from the reserve head grade as outlined in the independent technical report prepared for the Nixon Fork Gold Mine in October 2006. On October 10, 2007, the Company announced the temporary suspension of production at the Nixon Fork Gold Mine to provide the Company with sufficient time to continue delineation drilling of the existing mineral resources and reserves in the C3000 and C3300 zones in the Crystal deposit in order to better define the irregular geometry of the gold mineralization for improved future mining recovery and dilution.

Holloway-Holt Gold Complex

The Company commenced mine site exploration and development activities at its Holloway and Holt Mines in the first quarter of 2007 in preparation for a production decision to be made for the start up of the mines anticipated to be made at the end of the second quarter of 2008 after receipt of an independent 43-101 Technical Report on the mine.

During the third quarter of 2007, 2,273 metres of definition diamond drilling was completed and 841 metres of development were advanced at the Holloway Mine; and 1,082 metres of definition diamond drilling and 1,082 metres of development were advanced at the Holt Mine, respectively. For the quarter ended September 30, 2007, the Company processed 76,410 tonnes of primarily development ore from the Holloway-Holt Gold Complex with a head grade of 3.9 g/t, producing 7,953 ounces of gold at its Holt Gold Mill. Gold sales of $5.2 million, derived from the sale of 7,311 ounces of gold poured from the mill circuit, have been accounted for as a reduction of mine exploration and development expenditures.

Taylor Advance Exploration Project

As at the end of September 30, 2007, the main ramp development at the Taylor Advance Exploration Project had advanced 1,091 metres in 2007. In addition to the mini bulk sample of 3,756 tonnes of ore processed in the second quarter from the Shaft Zone located at the bottom of the Taylor Shaft, the Company processed another 5,125 tonnes of ore derived from the Taylor Shaft Zone in the third quarter producing 416 ounces of gold at a head grade of 3.4 g/t. The proceeds from the bulk sample of $0.3 million were accounted for as a reduction of exploration expenses.

Board resignation

Mr. Glenn Laing, a director and the former President and CEO of the Company resigned from the board effective November 13, 2007 to pursue other interests.

About St Andrew

St Andrew is a gold mining and exploration company with operations in Timmins, Ontario and Alaska. St Andrew controls a very large land position in the Timmins Mining Camp, an extensive land position at Eskay Creek in northern British Columbia and land positions around Nixon Fork Gold Mine in the Kuskokwim-Tintina Mining Camp in Alaska. St Andrew also holds an approximate 50.2% equity interest in New Zealand based gold explorer Glass Earth Limited which holds extensive land positions on the North and South Islands in New Zealand, and a 19.0% equity interest in Apollo Gold Corporation, which has operations in Montana, Mexico and the Black Fox Deposit located in the vicinity of St Andrew's Timmins operations.


The information in this release may contain forward-looking information under applicable securities laws. 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 implied by the forward-looking information. Factors that may cause actual results to vary material include, but are not limited to, inaccurate assumptions concerning the exploration for and development of mineral deposits, political instability, currency fluctuations, unanticipated operational or technical difficulties, changes in laws or regulations, the risks of obtaining necessary licenses and permits, changes in general economic conditions or conditions in the financial markets and the inability to raise additional financing. Readers are cautioned not to place undue reliance on this forward-looking information. St Andrew 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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