October 1, 2012


1 October 2012

Aureus Mining Inc.




Aureus Mining Inc. (“Aureus” or the “Company”) is pleased to announce the results of its NI 43-101 compliant Feasibility Study (“FS”) for its New Liberty Project in Liberia (“New Liberty” or “the Project”). The FS outlines an economically viable and robust gold project based on an average gold price of US$ 1,400 / oz. New Liberty will be Liberia’s first commercial gold mine and Aureus’ first mine in its highly prospective 546km2 total licence area.

The main conclusions from the FS demonstrate a pre-tax IRR of 37% at an average gold price of US$ 1,400 / oz, average annual production of 120,000oz per annum over the first four years at 3.7g/t head grade, with initial capital costs of US$ 140m.

In completing the FS Aureus was assisted by AMC Consultants (UK) Limited (“AMC”), DRA Mineral Projects (Pty) Ltd (“DRA”), MDS Ltd (“MDS”), Golder Associates Ghana Ltd (“Golder”) and Digby Wells (Pty) Ltd (“Digby Wells”). The FS has been completed to within a ±10% cost accuracy based on firm tenders received from suppliers and contractors.

Key highlights of the FS include:

    • The NI 43-101 compliant technical report confirms a technically feasible and economically robust project, with the following attractive economics based on a discount rate of 5%:
Gold Price (US$/oz) Pre-Tax NPV (US$M) Post-Tax NPV (US$M) Pre-Tax IRR (%) Post-Tax IRR (%) Capital Payback(Years)
1400 Average 234 187 37 33 2.2
1750 Flat 444 334 52 45 1.8
  • Average annual gold production of 120,000 oz over the first four years of production at an average grade of 3.7g/t with total gold production of 846,000 oz over the eight year mine life
  • Life of mine (“LOM”) operating cash cost will average US$ 685 / oz, using contract mining
  • Initial capital cost estimate of US$ 140 million (excluding contingency)
  • Total revenue is US$ 1.2 billion and pre-tax cash flow of US$ 338 million based on an average gold price of US$ 1,400 / oz
  • The Feasibility work was completed to within a 10% cost accuracy based on firm tenders received from suppliers and contractors
  • The Company believes that there are multiple, further opportunities to optimize the project and this work is in progress and will be completed in Q1 2013. A mine build and production schedule will be outlined in Q1 2013
  • Proven and Probable Reserve of 8.7 Mt at 3.3g/t for 910 koz of contained gold, which is an increase of 4% from the initial Reserve statement in February 2012
  • There is scope to increase current Reserves further through drilling of inferred resources on hanging wall lenses within the pit as well as drilling of inferred resource blocks just below the bottom of the current optimised pit
  • Open pit mine and gold plant designed to treat 1.1 Mtpa of primarily unweathered ore. The plant design incorporates two stage crushing, ball milling, gravity concentration and a Carbon-in-Leach (“CIL”) circuit for a full steady state recovery rate of 93%
  • Experienced senior management team being developed. GM Construction, a Metallurgical Manager and an Environmental Manager were all recruited in the last 12 months
  • 25 year, renewable, Mineral Development Agreement and mining licence in place and EIS permit expected in early Q4 2012 following the completion and submission of the EIA to the Environmental Protection Agency of Liberia in July 2012. With receipt of the environmental permit, Aureus can move quickly to obtain any other procedural and functional permits required for construction
  • There is strong interest in financing the project from various banks and financial institutions. Indicative financing terms have been received from a number of financial institutions, giving the Company significant optionality on debt financing

David Reading, Chief Executive Officer of Aureus, commented:

“We are delighted to be able to announce the results from the New Liberty Feasibility Study, which clearly illustrates the technical and financial robustness of the Project. This is a major milestone for the Company and Liberia, as New Liberty will become the country’s first commercial gold mine. This will not only generate wealth for Liberia and Aureus’ shareholders, but also provide significant employment and the opportunity for ancillary businesses in Grand Cape Mount County, western Liberia.”

“We believe we are still capable of improving the robust economics of the Project further through a number of initiatives. These opportunities include conversion of Inferred Resources through drilling and optimizing infrastructure, plant layout and conditions for gold recovery. Once this work is complete we intend to move quickly to mine building and production phases.”

“Aureus Mining remains on track to fulfil its objectives set out during its listing in April 2011: to bring New Liberty into production quickly, to become the first commercial gold mine in Liberia and invest the consequent cash flow into developing the high potential of the remainder of the licence area, with Aureus growing organically into a west African focussed mid-tier gold producer.”

A presentation for investors and analysts will take place at 9:00am BST on Monday 1 October 2012 at the office of Buchanan at 107 Cheapside, London, EC2V 6DN. Participation will also be available by webcast or conference call with the following details:

Conference call details:

Toll Number 0203 1400 693

Toll-free Number 0800 368 1895

Participant PIN Code 853573#

Webcast will be available at:

A recording of the conference call will be made available on:

Playback Number 0203 140 0693

Playback toll free number 0800 368 1890

The Company will hold a second conference call for the North American investors and analysts at 1pm BST / 8am EST. The dial in details are as follows:

Toll Number UK 02031400693

Toll-Free Number UK 08003681895

Toll Number Canada 1866 561 8617

Toll-free Canada 1416 915 9520

Toll Number USA 1866 928 6049

Toll Free USA 1631 510 7490

Participant PIN Code 571319#

A replay of the conference call will be available on the following numbers from 4pm BST/11am EST/8 am PDT on Monday 1 October.

Toll Number UK 0203 140 0693

Toll Free Number UK 08003681890

Participant Pin Code 387230#

Diagram: New Liberty: excellent location in Liberia

Updated Reserve Statement

The NI 43-101 compliant technical study summarises the feasibility work and gives an updated Reserve statement for the New Liberty gold project. This study has been compiled by AMC with significant contributions from DRA and MDS for metallurgical test work, process design, plant capital and process operating costs, and Golder for tailings, creek diversion and environmental studies. The FS summarizes the geology, resources, reserves, mining and mine production schedule, metallurgy, process plant design, infrastructure design, including tailings management facility, capital and operating cost estimates, financial modelling and the key results of the environmental baseline studies. The Reserve estimate was undertaken by AMC in accordance with the requirements of NI 43-101.

Diagram: Resource Grade Model with Optimised Final Pit Shell

The Reserves support an open pit operation with an average annual production rate of 1.1 million tonnes of ore per annum over an eight year production life. Plant production over the first four years averages 120,000 ounces per annum at a grade of 3.7g/t. All of the Reserve at New Liberty is located within 220 meters of surface and is extractable by open pit mining methods.

The total Reserve estimate of 910,000 ounces of gold grading 3.3 g/t is comprised of 700,000 tonnes grading 4.4 g/t (for 99,000 ounces) in the Proven category and 7,960,000 tonnes grading 3.2 g/t (for 811,000 ounces) in the Probable category, as detailed in the table below. The Proven and Probable Ore Reserves are contained within open pits of depths between 180 and 220 metres below surface. The ore body is still open at depth.

The reported Reserve estimate is shown in the following table:

Reserve Classification Tonnes Gold (g/t) Gold koz
Proven 700,000 4.4 99
Probable 7,960,000 3.2 811
Total Proven and Probable 8,660,000 3.3 910


  1. The Ore Reserve was estimated by construction of a block model within constraining wireframes and based on Measured and Indicated Resources
  2. The Ore Reserve is reported at a cut-off grade of 0.8 g/t Au and ore grading between 0.8 and 1.0 g/t cut off is stockpiled for processing towards the end of the mine life
  3. A dilution skin of 0.5m added and a minimum mining width of 2.5m was applied
  4. The Ore Reserves were estimated based on the updated NI 43-101 Mineral Resource as stated in this same study
  5. The cut-off grade of 0.8 g/t was used for pit optimisations and were based on a gold price of US$ 1,300 per ounce
  6. A 93 % metallurgical gold recovery was used
  7. Due to rounding, some columns or rows may not add up exactly to the computed totals

Diagram: Resource Model in Optimised Pit

Resource Statement

As previously announced on 30 May 2012, the total Resource estimate is comprised of 651,000 tonnes grading 4.77 g/t (for 100,000 ounces) in the Measured category, 9,145,000 tonnes grading 3.55 g/t (for 1,043,000 ounces) in the Indicated category, and 5,730,000 tonnes grading 3.2 g/t (for 593,000 ounces) in the Inferred category, as detailed in the table below. The Measured and Indicated Resources are located generally within the first 200 meters below surface. The Inferred Resource remains open at depth.

The reported Resource estimate is shown in the following table:

Mineral Resource Tonnes (kt) Average Grade (g/t) Contained Gold (koz)
Measured 651 4.77 100
Indicated 9,145 3.55 1,043
Subtotal M+I 9,796 3.63 1,143
Inferred 5,730 3.2 593


  1. CIM definitions were used for Mineral Resources
  2. A cut-off grade of 1.0 g/t Au is applied for all zones
  3. Due to rounding, some columns or rows may not add up exactly to the computed totals
  4. The Mineral Resource is inclusive of the Mineral Reserve



Key Project Parameters

The key technical, operational and financial information has been summarised in the following table:

Unweathered Ore Mined Mt 8.4
Oxide Ore Mined Mt 0.3
Waste Mined (including pre-strip) Mt 131.8
Total Material Mined Mt 140.5
Initial Pre-Strip Mt 2.5
Total Mill Feed Processed Mt 8.7
Open Pit Mining Life Years 8.5
Contained Gold koz Au 910
Recovered Gold koz Au 846
Average Strip ratio Waste/Ore 15:1
Average Head Grade g/t 3.3
Average Gold Recovery % 93
Average Annual Tonnes Processed Mtpa 1.1
Average Annual Production Y1-Y4 oz Au / yr 120,000
Average Annual Production Y5-Y8 oz Au / yr 93,000
Initial Capex (excluding contingency) US$ M 140
Operating Cash Costs US$ / oz 685
Mining Cost US$/t 2.47
Processing Cost US$/t 23.42

Infrastructure and Capital Costs

The initial capital cost of US$ 140 million for the project (excluding contingency) includes the design and development of the processing plant, mining establishment and pre-strip, general mine infrastructure and power supply, tailings dam construction, creek diversion and general infrastructure. The initial capital cost has been prepared to an estimating accuracy allowance of ±10%.

Capital costs are summarised as follows:

Processing plant 65.2
Infrastructure and power supply 24.3
Indirect costs 23.4
Initial mining pre-strip 5.5
Tailings dam construction 6.6
Creek diversion 9.0
Village relocation, G&A and Owner costs 6.0
TOTAL Initial Capital 140.0
Contingency 14.0

Deferred capex will be incurred following the commencement of production. Sustaining capital includes the mine closure costs and the sequential development of the tailings dam facility. The mine closure costs cover environmental aspects at the mine and process plant sites. Mining operations will be undertaken on a contract basis. The diesel generators, fuel farm and mining fleet equipment are covered by lease agreements over the LOM.

Category US$ M
Sustaining capital and mine closure 12.8
Diesel Generators, fuel farm and mining fleet over LOM 60.6
Mine strip – phases 2, 3 and 4 18.0

Operating cash costs

US$ M US$/oz produced
Mining 323 381
Processing 203 240
General and Administration 54 64
Total 580 685

Note: Operating cash costs exclude costs for freight and refining and government royalties

The financial model, which includes all of the capital and operating costs, has been prepared based on capital and operating cost estimates and production schedules provided by and endorsed by competent persons.

Economic Sensitivity Analysis

Economic analysis was undertaken on a pre-Government free and carried interest basis and utilises an average gold price of US$ 1,400 / oz over the eight year life. This data is presented with a sensitivity analysis which examines the project economics at different gold prices.

Gold Price US$ 1,400 / oz average US$ 1,750 / oz
Project Revenue (US$M) 1,188 1,481
Pre-tax Cashflow (US$M) 338 623
Pre-tax NPV @ 5% (US$ M) 234 444
Post-tax NPV @ 5% (US$ M) 187 334
Pre-tax NPV @ 8% (US$ M) 188 365
Post-tax NPV @ 8% (US$ M) 148 272
Pre-tax IRR (%) 37 52
Post-tax IRR (%) 33 45

The Government of Liberia corporation tax is 30% and the Government has a net smelter royalty of 3%. The Government of Liberia holds a 10% free and carried interest in the project which is payable after all capital costs and project sunk costs have been recovered. Sunk costs prior to the commencement of construction are estimated to be US$ 60 million.

A sensitivity analysis was undertaken on the project economics and the results are set out below:

Factor Change Effect on NPV
Gold Price +10% + 38%
Operating Costs +10% -20%
Capital Costs +10% -6%
Ore Grade -10% -38%

Project Optimization

The Company believes that there are several opportunities to improve the project economics and is embarking on a short period of optimisation work which is focused on three principal study areas: CIL leach kinetics and layout and location of infrastructure such as the TSF and the Gold Plant. This work is currently in progress and includes programmes of geotechnical and sterilisation drilling, an airborne LIDAR survey and further metallurgical test work.

Mining plan

The New Liberty project will comprise an open pit mining operation extracting ore at a nominal rate of 1.1 Mtpa with an operating life of eight years. The open pit will comprise two adjacent and interconnecting pits.

The mine design aspects were completed by AMC and comprised pit optimisation using Whittle-4X based on the Measured and Indicated Resources. A staged mining sequence was developed for production scheduling.

The mining schedule sees the operation produce a total of 8.7 Mt of ore grading 3.3 g/t with an associated 132 Mt of waste with an average life of mine stripping ratio of 15:1 over a mine schedule of 8.5 years. The pit optimisations were undertaken at US$ 1,300 / oz gold and a metallurgical recovery of 93%. A steady state mining rate is planned after the initial period of waste pre-stripping at an annualised plant feed rate of 1.1 Mt. The annual waste mining rate is 22.2 Mt for the first five years followed by 10.6 Mt, 5.7 Mt and 2 Mt for the last year, which results in an average waste mining rate of 16.2 Mt over the 8 year mine life. It is planned to pre-strip an estimated 2.2 Mt of waste at a cost of US$ 5.5 million, which is included in the initial mine capital cost budget.

The waste material will be placed in a dump to the south of the pit for the first four years of production, after which the majority of waste material will be backfilled into the Larjor pit. A mining contractor will be used for all earthmoving activities and mining operations will use a conventional truck and shovel method.

Diagram: Phases of Mine Development

Diagram: Life of Mine Production and Grade

General Infrastructure layout

Diagram: General infrastructure layout

The mining project covers an area of 8km2 and includes process plant, offices, workshops, generator power plant, housing and warehouses, mining camp, a tailings storage facility (“TSF”), a rock dump, explosives bay, various ore stockpiles and a stream diversion referred to as the Marvoe Creek Diversion Channel (“MCDC”).

The TSF and MCDC design work was undertaken by Golder. The TSF covers an estimated footprint of 58 hectares and locates in a shallow valley surrounded by undulating hills. The TSF will be raised in stages with the initial dam providing for approximately two years of tailings. Total dam capacity will provide for the storage of 8.7 million tonnes of processed material. The MCDC design results in the diversion of a creek to the North and West of the open pit area. The diversion channel will consist of a series of interconnecting excavated channels, small dams and berms. The diversion channel will be excavated during the pre-production period.

Metallurgy Testing

A Gravity / Carbon in Leach (“CIL”) process design is recommended for the New Liberty ore deposit. The plant design will allow for a ‘hybrid’ circuit containing prior pre-oxidation and leaching to increase the loaded carbon value and improve the leach kinetics. Leach kinetics show gold dissolution is initially rapid and after 48 hours optimum dissolution is achieved. Pre-oxidation tests are in progress with the aim of improving the leach kinetics, recovery and reagent consumption.

A high proportion of the contained gold (50%) is recoverable by gravity with the remaining portion recovered by CIL leach for a full steady state recovery rate of 93%.

Plant Process Design

The New Liberty plant design is based on a typical two-stage crushing process, ball-milling and CIL flowsheet (it includes primary crushing, secondary crushing and a ball mill). A gravity circuit will be used to treat a portion of the cyclone underflow screen to recover free gold from the recirculating load. The milled product will gravitate to a trash screen before entering a pre-leach thickener. Thickened underflow will be pumped to a four stage pre-oxidation / leach circuit, which overflows into a seven stage CIL to recover the dissolved gold onto carbon. Loaded carbon will be stripped to electrowinning cells. Cathodes will be smelted to doré in a conventional gold room. Cyanide in the CIL tailings will be detoxified prior to being pumped to the TSF.

The process flow sheet is well known in the gold mining industry. It is considered to be low risk and historically has proven a successful processing route for ore bodies in Africa.

Diagram: Process plant

Environmental Assessment

An Environmental Impact Study (“EIS”) was undertaken from Q4 2010 to Q2 2012 and submitted on 5 July 2012 to the Environmental Protection Agency of Liberia (“EPA”). The New Liberty Gold Mine’s EIS is a comprehensive document of two volumes that incorporates environmental and social baseline studies and also contains environmental and social impact assessments for appropriate specialist disciplines, which incorporate feedback received from regular consultations with relevant stakeholders and affected communities. The EIS relates to the proposed development of an open pit gold mining project and associated infrastructure and covers an area of approximately 16km².

The EIS and associated Environmental Impact Assessment (“EIA”) were prepared and undertaken by Golder and EarthCons Inc. of Liberia in consultation with the Company’s Environmental Officer. The environmental permit is expected to be issued in early Q4 2012.

Digby Wells Ltd has been commissioned to develop a Resettlement Action Plan (“RAP”) to address the resettlement impacts associated with the development of the proposed New Liberty Gold Mine. Aureus has committed to develop and implement the RAP in accordance with the applicable Liberian legislation and international best practise and principles such as the IFC standards. Discussions were held between the community, local Liberian authority and Aureus and a preferred site has been identified and agreed to by the community for the relocation of approximately 300 dwellings. The RAP will be submitted to the Liberian Government for approval during Q4 2012.

Quality assurance / quality control (“QA/QC”) and chain of custody

  • QA/QC analyses for the period from 2005 to 2012 were undertaken by AMC in preparation for Resource estimation. The progressive introduction of QA/QC procedures included the standard implementation of field duplicates (quarter core and crushed), blank samples, standards and laboratory repeats, as well as specific programmes of re-assaying and umpire laboratory assaying
  • Diamond drilling at New Liberty was supervised by the Company’s geologists who also conducted and managed the preparation, logging and sampling of core. In recent campaigns, bulk density measurements were taken from a sample in every core tray
  • During the sampling, quality control standards and blanks samples were inserted at pre-determined intervals. For all holes drilled since 2009, samples were sent from site directly to the ALS/OMAC sample preparation facility in Monrovia. ALS/OMAC is accredited by Irish National Accreditation Board to ISO 17025 and fire assay is included in the Schedule of Accreditation
  • Pulp weights sent from Liberia for analysis were between 100g and 200g
  • Aqua regia digests are analysed for gold using a Varian AA Spectrometer
  • Please note that further details on QA/QC can be found in the Company’s Technical Report filing for New Liberty dated March 2012

Technical Report

Aureus will file a NI 43-101 compliant technical report on the New Liberty Project outlining the Mineral Resources and Reserves Estimate and the results of the FS. The report will be available within 45 days at and on the Company’s corporate website

Qualified Persons

The estimates of Mineral Resources were calculated in accordance with NI 43-101 and carried out by Chris G Arnold BSc (Hons), MSc, MAusIMM (CP) of independent consultants, AMC. The Reserve Study was prepared by Martin W Staples BSc (Mining Engineering), FAusIMM of AMC. Both Mr Arnold and Mr Staples are Qualified Persons, for the purposes of the study, under the standards set forth by National Instrument 43-101 “Standards of Disclosure for Mineral Project”, of the Canadian Securities Administrators (“NI 43-101”), and they have also reviewed and approved the contents of this news release, as applicable.

The design and capital estimate to FS level of the Processing Plant and associated infrastructure, mining support infrastructure, incorporating capital estimates for the MCDC and the TSF as designed by Golder, was undertaken by DRA under the supervision of Robin M Welsh, BSc Engineering, Pr Eng, MSAIEE.

The basic process plant configuration and recovery were prepared by Mr Stuart Lawrence who is Managing Director of MDS. Mr Lawrence holds a BSc from the University of Leeds and is a FSAIMM.

The Company’s Qualified Person responsible for preparing the ESIA document is Chris Fell who is the Regional Manager for West Africa of Golder. Mr Fell holds a BSc in Forestry from the University of Stellenbosch and a Masters in Philosophy in Environment and Development from the University of Cambridge.

The Company’s Qualified Person responsible for preparing the TSF design and MCDC design is Laurent Gareau, M.Sc, P. Eng, Principal Lead Engineer, Golder.

The Company’s Qualified Person responsible for preparing the RAP is Daniel Jakobus Otto, M.Sc Environmental Management, Environmental Scientist, Digby Wells.

Contact Information

Aureus Mining Inc.David Reading / Jeremy CaveTel: +44(0) 20 7257 2930 BuchananBobby Morse / Louise MasonTel: +44(0) 20 7466 5000
RBC Capital Markets (Nominated Adviser and Joint Broker)Martin Eales / Richard HughesTel: +44(0) 20 7653 4000 GMP Securities Europe LLP (Joint Broker)Richard Greenfield / Alexandra CarseTel: +44(0) 20 7647 2800

About Aureus Mining Inc.

The Company’s assets include the New Liberty gold deposit in Liberia (the “New Liberty Gold Project”), which has an estimated Reserve of 910,000 ounces of gold grading 3.3 g/t and an estimated Measured and Indicated Mineral Resource of 1,143,000 ounces of gold grading 3.6 g/t and an estimated Inferred Mineral Resource of 593,000 ounces of gold grading 3.2 g/t. The project is expected to have an eight and a half year mine life and annual production of 120,000 ounces for the first four years of production.

The New Liberty Gold Project is located within the Bea Mountain mining license which covers 457 km² and has a 25 year, renewable, mineral development agreement. The Bea Mountain mining license also hosts the proximal gold targets of Ndablama, Gondoja and Weaju, which are the focus of exploration programs during 2012. The contiguous Archaen Gold exploration licence is also a focus of exploration for 2012, with Leopard Rock being the main target.

The Company also has gold assets within exploration properties in Cameroon.

Forward-looking Statements

This press release contains certain forward-looking information. All information, other than information regarding historical fact, that addresses activities, events or developments that Aureus Mining believes, expects or anticipates will or may occur in the future is forward-looking information. Forward-looking information contained in this press release includes, but may not be limited to, the future plans and objectives of Aureus Mining and their anticipated future growth, mineral resource estimates and the anticipated exploration and development activities of Aureus Mining. The foregoing and any other forward-looking information contained in this press release reflects the current expectations, assumptions or beliefs of Aureus Mining based on information currently available to Aureus Mining. With respect to the forward-looking information contained in this press release, Aureus Mining has made assumptions regarding, among other things: general business, economic and mining industry conditions; and it has also been assumed that no material adverse change in the price of precious and/or base metals occurs, no unusual geological or technical problems occur and no significant events occur outside of the normal course of Aureus Mining’s respective business.

Such forward-looking information is subject to a number of risks and uncertainties that may cause actual results or events to differ materially from current expectations, including: risks normally incidental to exploration and development of mineral properties; uncertainties in the interpretation of results from drilling and test work; the possibility that future exploration, development or mining results will not be consistent with expectations; uncertainty of mineral resources estimates; adverse changes in precious and/or base metal prices; and future unforeseen liabilities and other factors including, but not limited to, those listed under “Risk Factors” in the Preliminary Prospectus of Aureus Mining Inc. dated April 20, 2011, a copy of which is available on SEDAR at, and in the Aureus Mining Admission Document, a copy of which is available at www.aureus–

Any mineral resource figures referred to in this press release are estimates and no assurances can be given that the indicated levels of minerals will be produced. Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. While Aureus Mining believes that the mineral resource estimates in respect of their respective properties are well established, by their nature mineral resource estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such mineral resource estimates are inaccurate or are reduced in the future, this could have a material adverse impact on Aureus Mining, as applicable. Due to the uncertainty that may be attached to inferred mineral resources, it cannot be assumed that all or any part of an inferred mineral resource will be upgraded to an indicated or measured mineral resource as a result of continued exploration.

Forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable law, Aureus Mining disclaims any obligation to update or modify such forward-looking information, either as a result of new information, future events or for any other reason.