DENVER, COLORADO--(Marketwire - Feb. 23, 2011) - Golden Star Resources Ltd. (News - Market indicators)(NYSE Amex:GSS)(GSE:GSR) ("Golden Star" or the "Company") is pleased to announce significant increases in its Proven and Probable Mineral Reserves (collectively "Mineral Reserves") and Mineral Resources as at December 31, 2010.
Mineral Reserves, net of mining depletion, increased by 882,000 ounces or 24% by reaching a tonnage of 65.3 million grading 2.20 grams per tonne (g/t) for contained gold of 4.62 million ounces at year end. The increase was the result of successful exploration efforts (38%) and an increased gold price (55%). The remainder of the increase (7%) was due to geologic modeling, data interpretation, resource block modeling and changes in engineering parameters. Mining depletion totaled 460,000 ounces of gold and therefore the total reserve addition before depletion was 1.35 million ounces of gold, equivalent to a 36% increase over the Mineral Reserves at December 31, 2009.
Measured and Indicated Mineral Resources increased 63% over 2009 to 54.9 million tonnes grading 1.99 g/t gold. Inferred Mineral Resources increased 20% over 2009 to 16.5 million tonnes grading 3.66 g/t gold.
Tom Mair, President and CEO, said, "We are very pleased to report that our focus on organic growth through exploration has delivered results in 2010. In 2011, we will increase our exploration budget by $10 million to $30 million. Approximately 80% of this 2011 budget will be spent within haul distance of our existing processing plants. This year's results demonstrate the potential of our district-scale property holdings around both mine sites."
Mitchel Wasel, Vice President of Exploration added, "Based on this year's success, by mid-year, we will have nine drill rigs turning in Ghana in proximity to our processing plants. Our goal is to continue replacing and adding to our reserves and resources in the coming year. Our historical practice of using optimized pit shells for constraining resources has resulted in a high conversion of resources to reserves of approximately 70%."
The Mineral Reserve and Mineral Resource estimates have been estimated by our technical personnel in accordance with definitions and guidelines set out in the Definition Standards for Mineral Resources and Mineral Reserves published by the Canadian Institute of Mining, Metallurgy, and Petroleum and as required by Canada's National Instrument 43-101.
Reconciliation of Mineral Reserves
NON-RESERVE—MEASURED AND INDICATED MINERAL RESOURCES
Cautionary Note to US Investors concerning estimates of Measured and Indicated Mineral Resources
This section uses the terms "Measured Mineral Resources" and "Indicated Mineral Resources". We advise US investors that while these terms are recognized and required by Canadian regulations, the US Securities and Exchange Commission does not recognize them. US investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into mineral reserves.
Our Measured and Indicated Mineral Resources reported below are exclusive of the Proven and Probable Mineral Reserves as shown above and have been estimated in compliance with definitions set out in Canada's National Instrument 43-101.
Except as otherwise provided, the total Measured and Indicated Mineral Resources for all properties have been estimated at an economic cut-off grade based on a gold price of $1,300 per ounce for December 31, 2010 and $1,000 per ounce for December 31, 2009 and on economic parameters deemed realistic. The economic cut-off grades for Mineral Resources are lower than those for Mineral Reserves and are indicative of the fact that the Mineral Resource estimates include material that may become economic under more favorable conditions including increases in gold price.
The following table summarizes our estimated non-reserves – Measured and Indicated Mineral Resources as of December 31, 2010 as compared to the totals for December 31, 2009:
NON-RESERVES – INFERRED MINERAL RESOURCES
Cautionary Note to US Investors concerning estimates of Inferred Mineral Resources
This section uses the term "Inferred Mineral Resources." We advise US investors that while this term is recognized and required by NI 43-101, the US Securities and Exchange Commission does not recognize it. "Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of Inferred Mineral Resources will ever be upgraded to a higher category. In accordance with Canadian rules, estimates of Inferred Mineral Resources cannot form the basis of feasibility or other economic studies. US investors are cautioned not to assume that any part or all of the Inferred Mineral Resource exists, or is economically or legally mineable.
Our Inferred Mineral Resources have been estimated in compliance with definitions defined by NI 43-101.
Golden Star holds a 90% equity interest in Golden Star (Bogoso/Prestea) Limited and Golden Star (Wassa) Limited, which respectively own the Bogoso/Prestea and Wassa/HBB open-pit gold mines in Ghana. In addition, Golden Star has an 81% interest in the currently inactive Prestea Underground mine in Ghana, as well as gold exploration interests elsewhere in Ghana, in other parts of West Africa and in Brazil in South America. Golden Star has approximately 258 million shares outstanding.
Statements Regarding Forward-Looking Information: Some statements contained in this news release are forward- looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include our expectations regarding reserves and resources increases for 2011, our 2011 exploration activities and the number of drill rigs conducting such exploration, and our plans for processing refractory ore and non-refractory ore. Investors are cautioned that forward-looking statements are inherently uncertain and involve risks and uncertainties that could cause actual facts to differ materially. There can be no assurance that future developments affecting the Company will be those anticipated by management. Please refer to the discussion of these and other factors in our Form 10-K for 2009. The forecasts contained in this press release constitute management's current estimates, as of the date of this press release, with respect to the matters covered thereby. We expect that these estimates will change as new information is received. While we may elect to update these estimates at any time, we do not undertake any estimate at any particular time or in response to any particular event.