Perth, May 4, 2006 (ABN Newswire) - Allied Gold Limited (ASX: ALD), the emerging gold producer with gold and base metal exploration projects located in eastern Papua New Guinea Tabar Islands today announces the completion of the placement of 21,800,000 ordinary shares at A$0.60 per share to raise A$13,080,000 (approximately US$10,000,000) before expenses.

The placement has been made to international institutional clients of UK based Mirabaud Securities Limited. The placement has been made under the Company's 15% placement capacity in terms of ASX LR 7.1. and accordingly no shareholder or regulatory approvals are required under the ASX Rules.

This placement brings the total raised in equity markets since December 2005 to A$64.8 million (approximately GBP27 million).

Wayne Loxton, Allied Gold's Managing Director, commented:
"The funds raised in the placement will be applied to enhancing development of the Simberi Oxide Gold Project into gold production in Q2 2007 as well as providing additional funding for wider exploration in the Tabar Islands. In particular Allied Gold will investigate the outright purchase of key logistical equipment such as a barge for transportation of heavy goods and equipment to and from the Tabar Islands and the mainland, and the purchase of one or more drill rigs. Such purchases of key items of equipment will not only provide operating cost savings, but will enable the Company to schedule critical path logistical movements to suit its own planning, and to plan further ahead for exploration drilling.

"The company is continuing to broaden its international shareholder base which provides global recognition from the investment community for the Company and the Tabar Islands assets .This placement demonstrates the continued investor support for the robust economics of the Simberi Oxide Gold Project together with the significant exploration upside potential in a rising gold market."

The new ordinary shares will when issued rank pari passu with the existing ordinary shares in issue. Application will be made for the new ordinary shares to be admitted to trading on the ASX and AIM, and trading in such shares is expected to become effective on 11 May 2006. The placing is subject to settlement and admission of the new ordinary shares to trading on the ASX and AIM.


Source:
Australian public relations
Kevin Skinner
Field Public Relations
T +618 8234 9555
M 0414 822 631
Email Kevin@fieldpr.com.au