| January 26, 2009 |
| Central Sun Expands Potential Production Pipeline With the Cerro Quema Property |
TORONTO, ONTARIO--(Marketwire - Jan. 26, 2009) - Central Sun Mining Inc. (TSX:CSM)(NYSE Alternext US:SMC) ("Central Sun" or the "Company") is pleased to announce that it has regained majority control (60%) of the Cerro Quema gold property in Panama.
Peter Tagliamonte, President and Chief Executive Officer of Central Sun, commented: "We are very pleased with the return of the Cerro Quema property. Central Sun intends to immediately review the geological, engineering and construction work that has been completed on the property. The return of a 60% interest in Cerro Quema provides Central Sun with an additional potential future stream of gold development and production opportunity in our operating base of Central America. Once we have completed our review of the current stage of development at the Cerro Quema property, we will provide further updates."
Cerro Quema
Central Sun holds a 60% interest in the Cerro Quema Project located in Panama. A NI 43-101 feasibility study completed in May 2004 for the previous owners, RNC Gold Inc., which is available on www.sedar.com, indicated positive economics.
While previous studies indicated strong potential for Cerro Quema, Central Sun considers these as historical estimates and cautions investors that the project economics need to be updated in light of current economics and gold prices.
The Cerro Quema project area is located on the Azuero Peninsula in Los Santos Province of southwestern Panama, about 45 kilometers southwest of the provincial city of Chitre and about 190 kilometers southwest of Panama City. Central Sun originally acquired the 60% interest in the Cerro Quema Project from Yamana Gold through an equity asset transaction in 2006. Central Sun subsequently sold its interest in the property (see October 1, 2007 press release). The 60% interest in Cerro Quema was returned to Central Sun after the purchaser defaulted on the payment due on December 31, 2008.
Linear Gold Debenture
In conjunction with its previously announced business combination with Linear Gold Inc. ("Linear"), Central Sun is pleased to announce that it has completed a CDN$2.5 million debenture financing with Linear. Amounts outstanding under the debenture will become intra-corporate debt upon the successful completion of the business combination. The debenture shall be repayable within 60 days of any termination of the proposed business combination. In certain circumstances, Central Sun can elect to repay any amount outstanding under the debenture through the issue of Central Sun common shares.
About Central Sun
Central Sun Mining Inc. is a gold producer with mining and exploration activities focused in Nicaragua. Central Sun operates the Limon Mine in Nicaragua and is converting the Orosi Mine in Nicaragua to conventional milling to increase the annual gold output. It also holds a 60% interest in the Cerro Quema Project in Panama, a 100% interest in La India property and an option to acquire a 100% interest in the Mestiza gold property both of which are located 70 kilometres by road east of its operating Limon Mine. The Company is focused on efficient and productive mining practices to establish high quality and cost effective operations. Central Sun is committed to growth by optimizing current operations, expanding mineral reserves and resources at existing mines, exploring its extensive land holdings and seeking strategic mergers or acquisitions in the Americas.
Cautionary Note Regarding Forward-Looking Information This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements regarding the terms of the proposed business combination with Linear Gold and the benefits of such combination, exploration prospects, the identification of mineral reserves and resources, costs of and capital for exploration and development projects, exploration and development expenditures, timing of future exploration and development activities, expected production, requirements for additional capital, government regulation of mining operations, environmental risks, reclamation expenses, title disputes or claims, limitations of insurance coverage and the timing and possible outcome of pending litigation and regulatory matters. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".
Forward-looking information is based on various assumptions and on the best estimates of CSM as of the date hereof, and is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of CSM to be materially different from those expressed or implied by such forward-looking information, including but not limited to: transaction risks; risks relating to the completion of the transaction with Linear Gold and the integration of the two companies following combination; general business, economic, competitive, political and social uncertainties; the actual results of current exploration activities; delay or failure to receive board or regulatory approvals; timing and availability of external financing on acceptable terms; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of mineral prices; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; and, delays in obtaining governmental approvals or required financing or in the completion of activities, and as well as those risks identified under "Risk Factors" disclosure sections in the documents filed under the profile of CSM on SEDAR from time to time. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws. | |