SINGIDA PRE-FEASIBILITY STUDY, MINING LICENCE A...

SHANTA GOLD LIMITED SINGIDA PRE-FEASIBILITY STUDY, MINING LICENCE APPLICATION AND PROJECT PROGRESS 17 December 2010 In line with its development into a producing mining company, Shanta is pleased to announce the completion of a preliminary feasibility study ("PFS") and the submission of three mining licence applications and an Environmental and Social Impact Assessment Scoping Report for the Singida mining project in central Tanzania. The PFS was conducted by Environmental, Process and Mining Consultants (Pty) Ltd ("EPMC"), independent third party consultants, who also carried out the recently completed Chunya detailed feasibility study. The PFS has confirmed that the Singida project is extremely robust and the company will now proceed with a full detailed feasibility study immediately. This will be done by EPMC and is due for completion by the end of June 2011. Shanta submitted three mining licence applications covering the orebodies included in the preliminary feasibility study to the Ministry of Energy and Minerals of Tanzania on 8 December 2010 and the Scoping Report of the Environmental and Social Impact Assessment ("ESIA") to the National Environmental Management Committee on 13 December 2010. The ESIA is being conducted by MTL Consulting, a Tanzanian consulting firm with extensive experience in environmental certification studies in the mining industry in the country. Diamond drilling of three geotechnical boreholes has been completed and geotechnical logging conducted by a consultant from SRK, South Africa. The data gathered will be used to define pit slope design parameters and the ore intersections will be used to determine the rock grinding parameters including bond work index. PFS OVERVIEW ·        Singida has nine orebodies with a combined resource of 858,000 ounces (at a 1 g/t cut-off). The study focussed on seven of these, Gold Tree 1, 2 and 3, Jem, Vivian, Corn Patch and Corn Patch West and excludes Gustav and Kaiser Chief, ·        The orebodies are all located within a 5km radius. ·        The study envisages an annual mill feed of 540,000 tonnes from a series of open pits and underground operations, representing an average production rate of 45,000 tpm through a plant with a 75 tph capacity. ·        Average stripping ratio of the open pit operations is 9:1. ·        Orebody morphology and attitude have determined that initial mining will be by conventional open pit methods and that development of conventional narrow vein underground mining should commence early in the mine life. ·        Ore processing will consist of crushing, milling, combination cyanidation and adsorption circuit, elution electrowinning and smelting, achieving a 91% recovery. ·        Average production of 43,000 ounces per annum is planned. ·        The PFS mine plan has an annual production totalling approximately 387,000 ounces over a 9 year mine life. ·        Capital cost is estimated at US$83 million which includes US$43 million for the underground mine to be spent over the 12 month construction period, and US$10 million historical expenditure. ·        The total cash operating cost is estimated at US$699 per ounce, which includes the underground operations. ·        The ongoing detailed feasibility study will improve the accuracy of the cost estimates and further refine the production plan and design engineering to increase confidence in cashflow and financial forecasts on which a decision to mine will be made. Walton Imrie, the Company's Executive Chairman commented: "The Singida preliminary feasibility study shows the positive potential of the Singida project. Coming close on the heels of the completion of the Chunya feasibility study and commencement of construction at Chunya expected in January 2010, this project will place Shanta in a position to develop and commission two profitable mining operations within 24 months, which will be a significant achievement for a small explorer." For further information: Santa Gold Limited http://www.shantagold.com Gareth Taylor Mobile: +255(0)757732484 David Scott Mobile: +255(0)78 4366146() Walton Imrie Moblie: +27(0)82 4442851 Fairfax I.S. PLC Ewan Leggat/Laura Littley +44 (0) 20 7598 5368 GLOSSARY Adsorption: The step in the leaching process whereby gold dissolved by cyanidation is adsorbed onto activated carbon in the leach circuit. Bond work index: The measure of grindability of rock in evaluating grinding circuits performance to help maximize the use of the power delivered to grinding circuits in minerals processing plants. Cyanidation: Chemical process whereby diluted alkaline cyanide solutions are used to dissolve gold from ground rock particles. Detailed feasibility study: Detailed Feasibility Studies are normally the highest order and are the basis for capital appropriation and provide the budget figures for the project, completed with a financial accuracy of ±10% with a significant portion of the formal engineering completed. Electrowinning: The step in the gold recovery process through which the gold dissolved in elution is recovered from the solution by electrolysis prior to the smelting.  Elution: The process whereby electrodeposition circuit where hot caustic sodiumcyanide solution or pressurized steam is utilized to desorb the gold or silver from the charcoal Feasibility study: An evaluation of a proposed project to determine whether and how it can be mined economically. Preliminary feasibility study: Preliminary Studies are accurate to ± 25-30% and are typically obtained by factoring known unit costs and estimated gross dimensions or quantities once conceptual or preliminary engineering has been completed. This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and (ii) they are solely responsible for the content, accuracy and originality of the information contained therein. Source: Shanta Gold Limited via Thomson Reuters ONE [HUG#1473448]
UK 100

Latest directors dealings