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Galantas Gold to Increase Production at Omagh Property in County Tyrone

Galantas Gold Corporation's (TSX VENTURE:GAL)(AIM:GAL) wholly owned subsidiary, Omagh Minerals Ltd, has embarked on an investment programme designed to upgrade the processing plant, leading to a capacity expansion to 360 tonnes per day (126,000 tonnes per year) at the Company's gold mine at Omagh, County Tyrone.

The first step is the installation of a larger, semi-automatic concentrate filter press. The filter press, built by Micronics, has been installed in the processing plant at the open pit mine to enable increased production of gold-silver-lead concentrate for sale under the existing supply contract with Xstrata Corporation. The new press replaces a smaller, manually operated, Perrins model which will be refurbished and held as stand-by equipment. The new press has been commissioned and is operating satisfactorily.

A 3ft diameter, Symonds/Nordberg, cone crusher, in standard configuration, is to be refurbished. When complete, it will be installed in closed circuit with a smaller, 2ft diameter, Symonds / Nordberg unit, in short-head configuration. This unit is undergoing refurbishment prior to being replaced in the circuit. Both units are to be installed within closed circuit screening arrangements and these are expected to reduce the grinding requirement of the ball mill by delivering to it a finer feed. Temporary crushing arrangements have been organised which are expected to supply the plant with a restricted feed during part of the re-organisation sequence. With other scheduled improvements, the reorganisation is expected to lead to an increase in processing throughput up to approximately 15 tonnes per hour. Originally designed to handle 6.5 tonnes per hour, plant throughput was increased to a maximum of 10 tonnes per hour last year.

The processing plant upgrade will be completed in stages, with the crusher arrangement anticipated to be complete by the end of 2010. A used rod / ball mill is undergoing refurbishment by local contractors. This unit is in addition to the main ball mill and regrind ball mill currently in use. The rod mill will be brought into use early in 2011 to cover planned downtime on the main ball mill, whilst its end bearings are recoated. After this use, it will be placed in circuit for a further production enhancement.

Site power is provided by a single 1000kVA, diesel-powered generator. A second generator (800kVa) is expected to arrive by the end of November, to provide servicing and breakdown cover. The 1000kVA generator is currently a single line component. The provision is part of a program to reduce reliance on single line components and will permit enhanced servicing schedules. This is expected to improve efficiency, fuel consumption and extend the life of the prime unit.

Many of the costs of operating the processing plant are fixed and not directly dependent upon the quantity of ore processed. These costs include power generation and processing plant labour. The larger capacity plant is expected to reduce the cost of processing per tonne of ore. A reduction in processing cost per tonne permits a lower grade ore to be profitably worked (cut-off grade) and increases the quantity of ore available from the deposit for processing.

Extra improvements in capacity are anticipated once certain planning permits have been received respecting modifications to the mine plan on the Omagh property and further detail regarding the planning applications will be released shortly.

This release has been prepared under the supervision of Richard Crew (General Manager), a qualified person under the meaning of N.I 43-101, who is responsible for the technical information in this disclosure.

Source:

Galantas Gold Corporation

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