RNS Number:5958I
Highland Gold Mining Limited
12 March 2003

12 March 2003


    Highland Gold announces award of mining licences at Darasun and Teremky

The Board of Highland Gold Mining Limited ("Highland Gold" or the Company) today
announces the award of the long term mining licences at the Darasun and Teremky
deposits. The Darasun, Teremky and Talatuy deposits (together "the Darasun
Project") are located in the Tungokochensky District of the Chita Region in
Eastern Russia approximately 260km from the city of Chita.

It was indicated at the time of the admission of the Company's shares to AIM in
December 2002 that the tender process for the award of these licences was
underway. This process has now been concluded and at the end of February 2003
the Ministry of Natural Resources of the Russian Federation and the
Administration of the Chita Region formally granted the long term licences
expiring in 2023 (with the possibility of further extension) to OOO Darasunsky
Rudnik, a 100% subsidiary of Highland Gold, to use the mineral resources for the
purpose of mining gold and accompanying components at the Darasun and Teremky
deposits. Furthermore, Highland Gold can confirm that all major mining and
surface infrastructure assets have now been registered with the Company.

Darasun has measured, indicated and inferred resources of 1.8 million oz of gold
at an average grade of 15.1g/t and proven and probable reserves of 749,000 oz of
gold at an average grade of 12.5g/t. Teremky has measured, indicated and
inferred resources of 97,000 oz of gold at an average grade of 11.8 g/t and
proven and probable reserves of 32,000 oz of gold at an average grade of 18.5 g/
t. Resources are sufficient to support production for in excess of 18 years
although further development of gold existing in the P category, comprising some
4.5 million oz of gold, should allow production well beyond that.

Both deposits have significant underground development and surface
infrastructure in place. The Company now expects to be able to bring the
deposits into production during the first quarter of 2004, with target full
production of 225,000 tonnes of ore in that year. Target annual production at
the Darasun Project is expected to be approximately 100,000oz of gold per year
with operating costs broadly in line with the Group's current levels.

Lord Daresbury, Executive Chairman of Highland Gold, said:

"This is an extremely important milestone in the development of the Company. At
the time of Admission, we stated that the Company was committed to the expansion
of the Group's production base. The acquisition of the Darasun Project in 2002
and now the successful award of the licences at Darasun and Teremky further
underpin the Group's resource base and underscores the ability of the management
team to secure the ownership of significant development assets.

The award of the licences allows the Group to make significant financial
commitment to the Project, and the Board and management team are now confident
that it can be brought into production during the first quarter of 2004 adding
an estimated 100,000oz of gold to existing annual production and a meaningful
contribution to Group profits."


Enquiries:

Brunswick               Patrick Handley           020 7404 5959


Information about the Darasun Project

The Darasun, Teremky and Talatuy deposits (together "the Darasun Project") are
located in the Tungokochensky District of the Chita Region in Eastern Russia
approximately 260km from the city of Chita. In total, the Darasun Project has
measured, indicated and inferred resources of 3.1 million oz of gold and
probable reserves of 1.1 million oz of gold. Prior to today's announcement, the
Company has already secured the long term licence until 2012 to develop the
Talatuy deposit although additional work is required to enable it to fully
comply with the terms of that licence.

Darasun has been the site of gold mining activity for over 100 years. Shafts
were first sunk in 1905 to exploit near surface oxidised ore zones and
subsequently deepened to explore un-oxidised ore zones. Approximately 3.9
million oz of gold has already been extracted from the Darasun deposits until
2000 when mining activities were halted. Since then the underground
infrastructure has been kept on a care and maintenance basis until its
acquisition by the Company in 2002.

Since acquisition, the Company has invested in the assets and infrastructure at
the Darasun Project, acquiring all the underground mining equipment and the
majority of surface equipment including lifting machinery, maintenance
facilities, infrastructure and buildings, whilst conducting advanced feasibility
studies on the deposits and the design of the infrastructure for economic
extraction.

Russian technical institute Irgiridmet have already conducted feasibility
studies which have indicated that annual production of 375,000 tonnes of ore per
year are feasible from the three deposits with average recovery rates of 89.5%.
The Darasun Project was examined by SRK and included in the scope of their work
as competent person for the purpose of the Company's admission to AIM in
December 2002. The summary of mineral resources and ore reserves at the Darasun
Project included below are extracted from that report.

Darasun                Tonnage (kt)         Au Grade (g/t)     Au Content (koz)
B (Measured)                    170                   13.0                   71
C1 (Indicated)                2,080                   14.5                  966
Sub-Total                     2,250                   14.3                1,037
C2 (Inferred)                 1,490                   16.3                  780
Total                         3,740                   15.1                1,817


Teremky                Tonnage (kt)         Au Grade (g/t)     Au Content (koz)
B (Measured)                      -                      -                    -
C1 (Indicated)                   98                   15.1                   48
Sub-Total                        98                   15.1                   48
C2 (Inferred)                   158                    9.7                   49
Total                           256                   11.8                   97


Darasun                Tonnage (kt)         Au Grade (g/t)     Au Content (koz)
B (Proved)                        -                      -                    -
C1 (Probable)                 1,820                   12.8                  749
Total                         1,820                   12.8                  749


Teremky                Tonnage (kt)         Au Grade (g/t)     Au Content (koz)
B (Proved)                        -                      -                    -
C1 (Probable)                    54                   18.5                   32
Total                            54                   18.5                   32


Talatuy, the third deposit at the Darasun Project, has both open pit and
underground development and has further measured, indicated and inferred
resources of 1.2 million oz and proven and probable reserves of 289,000 oz of
gold. The Company continues to address compliance issues relating to the mining
license before being able to bring the deposit into full production. Further
details will be provided on this in due course.

In addition, a total of 4.5 million oz of gold exist in the P category in all
three deposits which is not sufficiently explored to be considered a mineral
resource under the JORC code but nevertheless provides an indication of the
exploration potential of the deposit.

Information on Highland Gold Mining Limited

Highland Gold was incorporated on 23 May 2002 for the purposes of acquiring,
consolidating and developing a portfolio of gold mining projects in the Russian
Federation with good growth potential. Highland Gold owns and operates the
Mnogovershinnoe mine, Russia's fourth largest gold producing mine in 2001,
situated in the Far East of the Russian Federation. It also owns two development
projects - Darasun and Novoshirokinskoye - in the Chita Region of Eastern
Russia.

Highland Gold produced 178,000oz of gold in 2002 and has an aggregate resource
base of 8.0 million oz, comprising 7.2 million oz of gold and 0.8 million oz of
gold equivalents, upon the successful resolution of outstanding issues relating
to the Talatuy and Novoshirokinskoye projects.

It's shares trade on the Alternative Investment Market of London Stock Exchange
plc and has a market capitalisation of approximately US$390 million.


                      This information is provided by RNS
            The company news service from the London Stock Exchange

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