Republic Gold Limited (ASX:RAU) Increases Amayapampa Gold Resource By 19.4% To 1.3 Million Ounces

Brisbane, Feb 15, 2010 AEST (ABN Newswire) - Republic Gold Limited (ASX:RAU) today announced that the Company has completed its upgrade of the geological block model at the Amayapampa Gold Project ("Amayapampa" or "Project") in Bolivia. The mineral resource has been increased by 19.4% from 1,084,000 ounces to 1,294,000 ounces.

Republic's Technical Director; Neb Zurkic, said: "This new geological model and subsequent mineral resource estimate provides the Company with a strong platform for the completion of the BFS. Republic is increasingly confident as we continue to confirm the potential at Amayapampa, and advance towards ascertaining the development potential of what the company expects to be a world-class gold mine in the highly prospective country of Bolivia.

"Substantial amounts of new data have been included in this estimate, including diamond drilling, surface sampling, topographical and mapping data. The Company is now more confident that this new yet conservative geological model will prove to be robust in the open pit optimisation stage and subsequent mining and development stage. The latest resource modelling has provided Republic with a comfortable degree of upside as we move towards developing the Amayapampa Project."

All the Company's 2009 drilling, trenching and shaft sampling data has been included in this new mineral resource estimate, as well as the new surface topography.

Comments on the New Model

The new model is more selective than those estimates announced by Republic to-date, with less tonnage at a higher grade than the previous model. The average grade added to the sampling over the past 18 months was lower than the average grade accounted for under the previous model, and the Company expects that the conservative approach to the latest model will increase the density and scope of the overall data on-hand. Republic has taken the necessary steps to ensure that the latest modelling has been as thorough as possible, which has resulted in a delay of the mineral resource upgrade due to topographical model difficulties, but was a prudent step in quantifying this result.

The 20% (or 80% near the surface) addition of new data to the database comprises 1,229 diamond core samples, 1,224 surface trench samples and 1,114 surface shaft samples. Although the global mean grade of the Company's additional samples were slightly lower in grade to the then-existing dataset, the combination of elements that constituted this geological block model update resulted in an increase of approximately 100,000 ounces. Given that the drilling, trenching and shafting undertaken by the Company was aimed at closing gaps in existing database and/or cross checking existing high grade data, the magnitude of the increase in global ounces is an endorsement of the Company's approach to determining the previous dataset and the current geological outlook.

The increased confidence in the new geological block model has allowed for the grade top cuts to be changed. The old model used a global top cut of 15.5 g/t Au. The new model uses a top cut of 20 g/t Au in the primary mineralisation, 10 g/t Au in the transitional mineralisation and 5 g/t Au in the surface oxide mineralisation. The 20 g/t Au top cut in the primary mineralisation is now more in line with previous consultants' work and the more severe top cuts in the surface mineralisation forms part of the Company's more conservative approach to accounting for high variance in the grade of the trench sampling which may be caused by the presence of coarse gold.

The presence of this coarse gold will mean it is likely that preliminary mining will result in significantly higher grades through the treatment plant in respective areas. Once the initial volumes of ore have been processed through the treatment plant and a the Company has a more comprehensive handle on the potential for very high grades within the oxide mineralisation, the current oxide top cut may be relaxed.

The modelling work will continue, with environmental and metallurgical estimations and risk assessments to be completed prior to the handover of the model for pit optimisation, design, planning and scheduling.

The only outstanding sampling that remains is the collection and calculation of additional bulk density data. This will be completed in the current Quarter. The existing bulk density database needs to better represent oxidation types and the mineralisation spatially to ensure tonnage estimates remain robust.

Structural Geology
The report following the site visit in September 2009 by the Company's consulting structural geologist, Dr Steve King's will be finalised shortly. Dr King's mapping was effectively utilised to provide detail on the control of the ore blocks in what is a complicated geological structural setting. This new resource estimate has also used the original interpretation of the mineralisation. Both this historical interpretation and Dr King's interpretation tie in very well with the geostatistics generated for this new geological block model.

This has resulted in better estimation of local grades and a better understanding of the overall potential at Amayapampa.

Dr King has also made some preliminary findings available to the Company. The principal finding relates to the structural setting at Amayapampa, with two major bounding faults on the east and west side of the current deposit producing a 1-kilometre wide zone, which are extremely positive for the discovery of much larger and separate deposits on either of these bounding faults. Dr King has also indicated that the existing deposit has good potential for extension to the north and some potential for extension at depth.

The intersection of two faults truncates the deposit to the south.

Cut-Off Grade Analysis

As announced in the December 2009 Quarterly Report, Gekko Systems recently completed a scoping study on the proposed treatment plant. Gekko Systems sourced treatment plant operating costs from the Company's Bolivian staff which indicated that at the current gold price a cut-off grade of 0.3 g/t Au is appropriate for the mineral resource and future ore reserve. However, Republic determined it prudent to incorporate a cut-off grade of 0.4 g/t Au which has been used for the new mineral resource estimate.

The Company's electrical engineering consultant in Bolivia has indicated that the electricity price used in the Gekko scoping study of US$0.06/kWh has the potential for considerable reduction once negotiations with power supply entities in Bolivia are progressed by the consultant.

Treatment Plant Site

Sterilisation sampling has commenced on the site chosen for the treatment plant.

Implications of the New Geological Block Model for Mine Planning and Scheduling.

The new geological block model has reinforced the Company's confidence in some very deep and high grade analysis results. Previously these had been eliminated from the mineral resource estimate. The inclusion of these results offers the potential to lead to a deeper open pit scenario. The new geological block model has improved the confidence levels of mineralisation along various margins of the model, meaning that these zones can now be taken into account in ore reserve calculations.

Internal Company pit optimisation studies using the previous geological block model indicated that at a gold price of US$825 per ounce accounting for previously estimated but lower metallurgical recoveries, that a substantial portion of the old mineral resource of 1,084,000 ounces had the potential to be mined.

The significant increase in the Measured and Indicated mineral resource to 990,000 ounces, higher metallurgical recoveries due to recently completed testwork and the higher gold price regime, bodes very well as the Company advances towards a significant ore reserve estimate at Amayapampa.

For the complete Republic Gold ASX Announcement please click the link below:

http://www.abnnewswire.net/media/en/docs/62273-ASX-RAU-332199.pdf

Contact

John Kelly Managing Director Republic Gold Limited Tel: +61-7-4092-2594 Mob: +61-418-577-759