· Phase One 2007 drilling completed:
- Significant widths of higher-grade mineralisation at Jinxi (51m @ 4.01g/t)
- Yelmand infill drilling confirms grade continuity and extensions to the west
· Phase Two 2007 drilling commenced:
- Definition drilling at Jinxi high grade zone
- Yelmand western extensions to be evaluated further
- Ongoing regional targets to be followed up and drill tested
· Pre Feasibility Studies on-going to advance development of the Gold Mountain Project
· Tianshan Goldfields Limited currently trading at $US27.3 per attributable combined resource ounce
2007 Field Programme
The first phase of drilling has confirmed significant widths of higher grade mineralisation in the southeast and west of the Jinxi deposit. Final assays received for Yelmand infill drilling have confirmed grade continuity within the resource envelope and extensions to mineralisation to the west.
The second phase of the 2007 programme will focus on further infill drilling at Jinxi to evaluate continuity of higher grade mineralisation to the southeast and recently confirmed western extensions to Yelmand will be evaluated further.
The second phase of the program includes a budgeted regional programme of approximately 5,000 metres of diamond core drilling. Regional targets include Kezele, located 5km south of the Yelmand deposit, where significant mineralisation was intersected during the first phase. Other regional targets planned for drilling include Chart, Awuliya and Linchang.
Pre-feasibility studies aim to advance development of the Gold Mountain Project
The 2.8moz1 Gold Mountain Project in north west China (“Gold Mountain”) (Tianshan Goldfields Ltd 90%) consists of large tonnage, disseminated style gold deposits in near surface breccia blankets, potentially associated with high grade feeder breccias and veins. These styles of deposits are typically developed as low cost open pit mining operations, with gold recovery by low capital intensity heap leaching methods.
Work commenced at the beginning of 2007 on pre-feasibility studies for a potential open pit and heap leach mining operation on three deposits within the current resource estimate of the Gold Mountain Project including Yelmand, Mayituobi and Jinxi.
This work has included ongoing metallurgical studies and column leach tests, and infill and extensional resource drilling to increase confidence of the known deposits for mine planning. Studies were also commenced during the year to gather base line environmental, social, surface and ground water data and preliminary work on acid rock drainage and heap leach pad location and design. The completion of these studies is required for mining licence application and mine development proposal. Results to date have allowed the board to consider mining and processing strategies at Gold Mountain which, along with metallurgical results, will be released to the market shortly.
Ordinary shares in issue 187,192,597
Share price (approx.) 19p/AUD$0.44*
Market capitalisation AUD$82.4 million
Cash AUD$6 million
Enterprise value per oz (2.8moz1-90%) US$27.3 attributable per oz
*1GBP = AUD$2.31
Shareholder options2 34.5 million
Employee options2 4.6 million
MSX preference share3 1
1. Combined indicated and inferred resource as announced to the market on 19 December 2006.
2. The options can be exercised at a fixed price (between AUD$0.175-$0.40 depending on the individual option term) and can be exercised any time up to 31 December 2008.
3. Preference share converts to 26 million TGF ordinary shares upon confirmation of 2 million gold resource ounces (including 1 million indicated) to JORC standard. The conditions of this preference share have been met. The holder may elect to convert at anytime.
Mr SL Allnutt (AusIMM, MAIG), Chief Geologist of Tianshan Goldfields Limited, compiled the technical aspects of this report relating to the Gold Mountain Project. Mr Allnutt has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that is being reported on to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Mineral Resources and Ore Reserves. Mr Allnutt consents to the inclusion in the report of the matters in the form and context in which it appears.
For Further Information, Please Contact:
Tianshan Goldfields Limited
Level 22, Allendale Square
77 St Georges Terrace
Perth WA 6000
Telephone: +61 8 9221 7729
Fax: +61 8 9221 7866
Keith Liddell - Chairman
Jason Bontempo - Chief Financial Officer
WH Ireland Limited
11 St James’s Square
Telephone: +44 161 8322174
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