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Message: NR Tulawaka update..mixed
EXPLORATION DRILLING RESULTS AT TULAWAKA MINE AND NEARBY PROSPECTS INDICATE POTENTIAL FOR EXTENDED MINE LIFE Montreal, July 27, 2010 – MDN Inc. (“MDN”) is pleased to report to its shareholders that
Gold plc (ABG), the project operator participating interest, announced second quarter and six months operational results and positive exploration drilling results in the underground mine and at nearby West Zone and Mojamoja prospects. Tulawaka Operational results African Barrick Gold reported that Tulawaka has successfully transitioned to an underground operation while also focussing on expanding the resource base and extending experienced in the first half of the year have now been addressed and production levels should show a corresponding increase. At Tulawaka, the focus has been on both the underground drill programme at Tulawaka Ea identifying sufficient resources to extend the life of the mine, as well as identifying additional open pit resources in order to maximise throughput at the processing facilities. Good progress has been made in both areas as described in more detail in the “Exploration” section below. Marc Boisvert, Vice-President of Exploration for MDN was at the mine to review the operational and exploration results and commented: “We are confident that the slowdown in gold production at Tulawaka will revert in the second half of 2010 and we are extremely pleased with exciting exploration results underground and encouraged by the West Zone and Mojamoja prospects”. Total gold production at Tulawaka for the six months ended 30 June 2010 was 27,513 ounce 45,054 ounces in the same period last year in turn resulted in lower underground tonnes hoisted. Lower grade stockpiles were also processed, so that total processed grade was less than planned. This was partially offset by increased throughput. Underground grades remained high at 9.15 g/t. The mine equipment shortages have now been addressed, with haulage truck capacity restored and an additional loader transferred from anoth levels should show a corresponding increase in the second half of 2010. Cash costs amounted to $641 per ounce sold for the six months ended 30 June 2010. This was 70% higher than the prior year period ($377 per ounce sold). This was driven by the combination of lower production and increased direct mining costs associated with energy, labour, maintenance and administration costs, coupled with the high fixed cost element at the operation. Gold ounces sold for the six months ended 30 June 2010 were in line with ounces produced for the period. at the Tulawaka gold mine in Tanzania in which MDN has a 30% nd its life of mine. The equipment shortages n year. The decrease in production was due to equipment shortages which another mine owned by African Barrick Gold (Bulyanhulu). Production d PRESS RELEASE TSX symbol: MDN TULAWAKAMINE African Barrick
East, with the aim of ounces compared with . er Capital expenditure equalled $5.5 million for the six month period ended 30 June 2010. This was 297% higher than the prior year period ($1.4 million). The increase relates to the implementation of an aggressive exploration drilling programme for both the underground and open pit resources in order to extend Tulawaka’s mine life beyond 2011. Exploration Update East Zone Underground Extensions At Tulawaka East Zone Underground, exploration drilling continued to
extend the known high-grade mineralised shoots below the previously defined Level 7 resource, indicating potential to extend mine life beyond 2011. At the same time, surface exploration drilling on Main West Zone and Mojamoja prospects continued to extend the potential near-surface open-pit resources within trucking distance to the Tulawaka plant. A total of 79 diamond core holes for 8,473m have been drilled to test the Tulawaka East Zone underground extensions below Level 7. Drilling to date shows the mineralised quartz veins extend at least down to Level 10 (45m below Level 7), and has intersected visible gold within quartz veining in several drill holes. The intersections confirm the projections made for the Zone 150 shoot, for which it is estimated that the entire block would add approximately 60K ounces to the reserve base if fully drilled out by year-end. A selection of the better intersections returned to date from the 79-hole underground exploration drill program include: Hole ID Mine Grid From Interval Au East North RL AZ Dip (m) (m) g/t TUDG00021 20442 50302 1026 172.5 -79.1 21.27 2.25 236.00 TUDG00163 20127 50263 1020 179.0 -30.5 49.84 8.66 6.66 including 51.4 1.01 40.0 TUGD00164 20127 50263 1020 180.0 -46.9 42.13 2.29 48.20 TUDG00175 20132 50265 1025 131.0 -45.0 46.0 10.3 16.51 including 48.2 2.35 63.8 TUDG00215 20535 50325 1029 205.0 -36.0 63.7 4.0 55.90 including 66.0 0.7 287.0 Note : intervals are along the hole Diamond drilling continues to test depth, plunge and strike extensions to the mineralised lodes throughout the East Zone and is currently focused on increasing reserves and resources for the year end update. The zone 150 represents only one of six mineral shoots being explored (see longitudinal section on MDN’s web site) in the underground mine levels. The Tulawaka Underground Project approval in April 2007 was based on an ore reserve of 99,870 ounces. As at June 2010, a total of 94,304 ounces had been mined out from the East Zone underground. It is projected that the Mine would achieve a milestone of mining total start up reserves by Q3 2010. Additional drilling from 2008 has proved successful in extending the reserve base, enabling us to continue mining underground. The current indications from the results of the drill programmes to date are that the Tulawaka mine life would be extended beyond 2011, based on underground and surface resources. Main West Zone Extensions & Mojamoja Prospect At Tulawaka, reverse circulation drilling at the Mojamoja
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