Current Operations

Gold mineralization in the BMS Gold Mine is predominantly within flat dipping quartz veins that make up approximately 80% of the resource tonnage, with the remainder of the resource occurring within stockworks, situated within metasedimentary rocks centered on a diorite stock and a small amount from tailings. The quartz veins vary in thickness with an average of 1.0m. The veins lie on average 30m apart with the country rock generally unmineralized. The BMS gold deposit was explored in the period 1962 to 1982 by two Cameroonian national companies with Soviet technical assistance. Extensive exploration by diamond drilling was completed over a number of years. The deepest vein intersection is 600m below surface. Production commenced in 1985 and a total of 227,000 tonnes of ore were treated at an average head grade of 13 g/t to produce 81,800 ounces of gold by August 1991 at a recovery of 86%.  The technical and financial resources were withdrawn in 1991 from the BMS Gold Mine with the break-up of the former Soviet Union, and the mine was placed on care and maintenance. After the acquisition by ABU  Gold, in late 2002, the existing plant and infrastructure was upgraded.  A contract was awarded to design and procure the new equipment for the gold plant and underground infrastructure.  Work commenced on site in the first quarter of 2003. The two existing winders were upgraded with larger motors and modern control systems. New underground water pumps were installed on the 100m level. The existing underground power system was replaced with new electrical substations, power cables and distribution systems.  New mining equipment such as locomotives, winches and drilling equipment were purchased and installed. The gold plant crusher and gravity sections were upgraded with a secondary crushing circuit, a Batouri gravity concentrator and gold room equipment. The existing ball mill was refurbished.  All existing electrical equipment was replaced with modern sub stations and distribution systems. The capacity of the existing tailings dam was increased by raising the wall of the facility by 4 metres.  The existing air compressors were replaced with two Atlas Copco units. Mine operation commenced in January 2004 with first gold production in March 2004.   Mining Operations The BMS Gold Mine recommenced production in January 2004. Gold production to date is shown in the following table. BMS Gold Mine Production for 2004 and 2011   Tonnes Milled Grade g/t Recovered Gold ozs Recovery (%) 2004 (1) 35,667 9.4 7,396 69 2005 (2) 34,885 15.5 14,923 86 2006 (3) 27,743 28,16 22,638 90 2007 35,222 24.21 25,359 92 2008 48,262 15.70 21,407 88 2009 49,348 12.08 16,677 87 2010 50,238 7.71 11,233 86 2011 (4) 47,546 7.19 9,290 85 Note: (1) In 2004 4,604 tonnes of coarse sand at 4.7 g/t are included in the total production. (2) In 2005 4,614 tonnes of coarse sand at 4.9 g/t are included in the total production (3) In 2006 3,627 tonnes of coarse sand at 5.8 /t are included in the total production (4) In 2011 an additional 250 ounces was recovered from the mill when the mill liners were replaced. Mine Development The mine is being developed to provide sufficient exposed ore reserves to meet the planned production rate of 60,000 tonnes per annum in 2009. The majority of the ore reserves lie between 100m and 300m below surface. The existing No 1 shaft is operational down to 100m below surface and is being used to hoist ore from stoping areas that are being mined down dip from the 100m level. During 2004 and 2005 some ore reserve blocks above the 100m level were also mined. No 2 shaft is located approximately 300m to the west of No 1 shaft. No 2 shaft was deepened to 195 metres below surface. Haulage development on the 150 and 180 levels will be developed from No 2 shaft to access new ore reserve blocks during 2006 and 2007.  These ore reserve blocks are located 300m north and 250m south of the two shafts. The current mine plan anticipates that in 2008 all the ore from the mine will be hoisted to surface via No 2 shaft and will be trucked to the plant located adjacent to No 1 shaft.  Shaft Infrastructure Access to underground workings is established through two shaft systems (referred to as No 1 Shaft and No 2 Shaft). Both shafts are 3 m in diameter.  No 1 Shaft is developed to 105 Level, a depth of 105 m, with an additional 5 m overrun. A single drum, licensed winder fitted with a 1.5 tonne capacity kibble is used for the transport of men, material and rock. The total rated hoisting capacity of the shaft system is approximately 5,000 tonnes per month. This shaft is not used for rock and men hoisting since 2007  No 2 Shaft is currently the main production shaft. The current shaft bottom is 180 m Level (180 m below surface), There are 2 haulage levels on 150 and 180 from No 2 shaft to the ore veins located north and south of the shaft. The ventilation of the mine workings is currently conducted with No 1 Shaft as a ventilation intake and No 2 Shaft as the exhaust shaft. Underground fans ensure adequate ventilation flow into the relevant workings. No 1 Shaft is located at the plant and hoisted ore is fed directly to the plant feed bin. Ore is hoisted from No 2 Shaft and transported to the gold plant by truck. A conveyor has been installed to feed the ore from No 2 Shaft into the existing plant crusher system. Mine Layout and Design Level development is established from the shafts to access the ore bodies. Drives are developed within the ore body to expose the mineralisation on strike. Raises and winzes are then developed to expose the dip extent of the mining blocks. Each block of ground, delineated by the planned production from a single raiseline, is referred to as a stope. Individual panels are established from the raiseline  and mined on strike to the mid point between raiselines. Systematic pillars will be left to provide roof support leading to a loss of approximately 20% when converting resources into reserves. Approximately 60% of the ore reserve to be mined in the current mine plan is located to the north of the existing underground infrastructure and between the 105 and 300 Levels. The ore between 105 and 180 Level will be accessed from No 2 Shaft. The shaft is be deepened and two additional levels (150 and 180) will be established.   Mining Method Stoping operations are conducted with conventional pneumatic handheld rock drills with airless. Blasted rock is scraped (with a 35 kW face winch) from the working face into strike gullies located at the bottom of each panel. A larger, 55 kW gully winch it then used to scrape the ore along the gullies. This ore is scraped directly into the hoppers via a chute arrangement, referred to as a‘chinaman chute’ or into a rock pass down to the haulage. The 1.2 tonne hoppers are trammed with 3 tonne battery locomotives to the shaft. Production blasts produce a 0.9 m to 1.2 m face advance. Level development is conducted with a similar system as the stoping. The planned advance is 1.5 m per blast. Blasted rock is loaded using pneumatic overhead loaders (LM36-type) which load directly into the same hoppers and trammed to the shaft. All level transport is rail bound. The hoppers are guided to the shaft and manually tipped to discharge directly into rock passes and then into the shaft loading box for hoisting to surface. A skip with a 2.5t payload is installed  in bo No 2 shaft Geotechnical Design Based on previous and more recent underground observations, the base of oxidation appears to vary between 100 and 70 Level. No underground mining operations are planned above 70 Level. Ground conditions generally appear good below the weathered zones, with competent ground and limited need for systematic support in development ends. Large exposed spans underground will require systematic support. In-stope support generally consists of wedged timber props. The use of in-stope pillars forms part of a detailed geotechnical investigation, following which SOMIKA reported that it has implemented the design recommendations. Drives developed in the ore body require stability pillars up dip and down dip until stoping has been completed. Subsequent extraction of these pillars is possible (at least in part) but has not been planned. Utilities Power Power is supplied to the mine via the national grid through a 5 MVA line. The average demand of the mine is currently 1.6 MVA and expected to increase with the commissioning of No 2 Shaft and increased pumping requirements with depth. The supply of power is reported to be generally reliable with interruptions being short. BMS reports the cost of electricity to be $0.15 per kWh. BAMISSING does have standby power generation capacity via a number of old Russian generators rated at 6.3 kV, 3 phase, 50 hz: two 1,000 kVA unit; and one 790 kVA unit. The mine reports that these units are operational and have been used during the course of 2004 during planned power stoppages and outages. These units will be retained as a back-up supply only, as the units have insufficient capacity to supply the entire operation. The Malian Government developed this electricity supply infrastructure specifically for the BAMISSING Gold Mine in connection with its solicitation for tenders in the Privatization process. ABU Cameroon, a subsidiary of ABU Gold, has entered into a supply contract with EDM for the BMS old Mine. Management is of the view that this electricity source is among the most reliable in Cameroon and has encountered limited outages to date. Water The mine itself generates sufficient water from underground for all operations, i.e. mining, plant and personal consumption (potable). Excess water is discharged into water courses. No outside water source is required. Water is currently being intersected by underground development. Pump facilities are established at No 2 Shaft on the 180 Levels. Water will either be pumped to surface or to the 100 Level pump station at No 1 Shaft. The No 2 Shaft pumping capacity is 160 litres per second. With the above installations, the mine will have the capacity to pump approximately double the current maximum quantity of water. Compressed air Three 200 kW air compressors have been installed on the mine. The total rated capacity of these units is approximately 2,500 cfm. Bamissing has indicated that currently, only two units are required, while the other is a standby unit. This capacity is expected to be more than sufficient for the planned underground long-term production requirements of 5,000 tonnes ROM monthly.