Archipelago?s Toka Tindung produces 8,800 ounces of gold in April-June

London-listed Archipelago Resources Plc, a miner owned by Rajawali Group, said its Toka Tindung gold mine project in Sulawesi Island has produced 8,800 ounces of gold during the period since it commenced production in April until June, 2011.

Of the production, 5,100 ounces sold at an average price of US$1,514 per ounce, resulting in first time operating revenues of $7.7 million in the first six months to June, 2011. Operating costs of the Toka Mine for the period totaled $5.4 million resulting in an operating profit of $1.0 million.

The Toka Tindung cash costs for the six month period to June 2011 were in line with plan and expected to reduce significantly as the project reaches full production.

The unaudited loss for the half year for the group was $2.6 million, compared to $2.2 million in the same period last year.

The group debt position increased to $70 million during the six month period of which $55 million was used to fund the metallurgical plant construction, mine development and ?first fill? start up costs at the Toka Mine.

Cash on hand as at 30 June was $22 million.

Stephen K. Sulistyo, Non Executive Chairman of Archipelago Resources, said that on April 1, 2011, the Toka Tindung mine achieved its first gold pour. The mine has subsequently continued its ?ramp-up? with grades and recoveries that are well within the company?s expectations.

He said the achievement is significant and underpins the quality of the ore body and the ability of both management and the operational staff at the mine to deliver.

?The company is now well placed to take its next step in its strategy of growing its production capacity utilizing the exploration potential at the Toka Tindung Mine, through further Vietnam and Philippines exploration and through corporate activity,? he said.

During the second half of this year the Toka Tindung mine continues to expand production, moving towards the mine's target rate of 160,000 ounces of gold equivalent per annum. ?A strong gold price coupled to our low cost profile can deliver significant value to our shareholders,? he said.

Archipelago also said that the company in August 2011, has appointed Marcus Engelbrecht as Managing Director and as Chief Executive Officer of Archipelago. (roffie)