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Asanko Provides Construction Update on Phase 1 of Ghana Asanko Gold Mine Project

Asanko Gold Inc. is pleased to provide a construction update on the fully funded Phase 1 of the Asanko Gold Mine in Ghana. Phase 1 will be a low cost, long life mine producing 190,000 ounces of gold per annum at steady state, with the first gold pour on track for Q1 2016.

Project construction remains on schedule with 60% of the overall project complete and around 2,443 employees and contractors on site, as at the end of June 2015. Concrete civils are 66% complete and steel, mechanical and platework 54% complete. All critical path items are in hand and on time. Procurement is practically complete with US$286 million committed out of the total capital budget of US$295 million. US$138 million has been spent up to June 30, 2015. The latest videos and photographs are available at http://www.asanko.com/projects/photo-gallery.

Peter Breese, President and CEO, commented: "Construction of Phase 1 continues to advance according to plan and budget, which is very encouraging. Mining operations have hit their stride with the entire PW mining fleet fully mobilized and current mining levels exceeding the plan. The plant site construction is progressing very well and with the Project now nearing 2/3rds completion, we remain confident that we will be able to deliver this project on time and within the capital budget of US$295 million."

Construction Update

The primary crusher foundations were completed in June and the structural, mechanical and platework installation has commenced. The installation of the Jaw crusher is expected to be completed by the end of July. The concrete work for the run-of-mine tip wall at the primary crusher, as well as the reinforced earth wall is still under construction and due for completion by the end of Q3 2015. The primary tip bin erection has commenced and will be completed in parallel.

Earthworks for the overland conveyor from the primary crusher to the stockpile tunnel were completed in June and the concrete precast sleeper foundations are being placed. The conveyor installation is expected to commence this month. Concrete work on the stockpile tunnel has been completed and installation of the apron feeder and other mechanical equipment is scheduled to commence in mid-July.

The foundations for the SAG and Ball Mills were completed in early June and installation of the mills has commenced with a planned completion date of November. Both the SAG and Ball Mills are on site, along with all the major ancillary pieces of equipment.

All seven CIL tanks and the cyanide detoxification tank have been fully erected, painted and welded. Interconnecting steel and platework is underway and due for completion by the end of Q3 2015. The mechanical installation of the agitators and inter-stage carbon screens will follow. Access to Electrical and Instrumentation ("E&I") and Piping contractors to this area is expected to be given at the end of July.

Steelwork on the pre-leach thickener has been completed and welding and platework are in the final stages, with completion expected in the next few weeks. The thickener bridge is scheduled to arrive on site mid-July and erection planned to take place in August.

The reagents building and store room are progressing well, all the steel work is erected and most of the tanks have been installed. Platework is over 90% complete and installation of the pipe and cable racks has commenced. The sheeting for the buildings is expected to arrive on site in July and be installed at that time.

The Gold Room platework is over half way towards completion and is expected to be fully complete in October.

The Tailings Storage Facility ("TSF") continues to progress well, with over 67% of earthworks complete and over 60% of the HDPE liner installed. The northern portion is complete and work is now focusing on the southern portion of the facility. The TSF is on track for completion during Q4 2015. The tailings pipeline trench construction is expected to commence in early August and is scheduled to be completed in November.

The E&I work has commenced in the Reagents area and on the pipe gantries. All remaining major equipment, such as elution heating, emergency generator, transformers, medium voltage switchgear, gravity concentrator and remaining structural steel is expected to arrive by mid-August, ahead of the final stages of installation. Terracing, drains and buried services for the entire plant site, including the footprint for the Phase 2 expansion project, are scheduled to be completed by the end of July. All other ancillary services, such as change house, workshop, raw water dam and pollution control dam, are on schedule.

Power

Bush clearing for the 161kV line has now been completed. Foundation work for the 82 towers along the 30km long power line is underway, with 65 tower foundations excavated and 55 tower foundations completed. 12 towers have already been erected and the remaining tower erection is due for completion in October. The medium voltage substation is well advanced and nearing completion.

In June 2015 Asanko signed a life of mine power purchase agreement with the independent power producer Genser Energy Ghana Limited ("Genser") which has considerably de-risked the supply of long term power to the mine. Genser will build and operate a 19.2 megawatts ("MW") liquid fuel power plant adjacent to the AGM site and supply 17MW of nominal power to Phase 1 on a fixed-price, life-of-mine contract. Until the on-site power plant is completed, which is expected by April 2016, Genser will provide interim power via temporary generating facilities. Bush clearing for the Genser power plant has been completed and construction of the terrace is underway and due for completion by the end of Q3 2015.

Mining

Pre-stripping of the Nkran Pit, the main mineral resource for Phase 1 continues to advance according to schedule. PW Ghana have now mobilized the entire mining fleet, consisting of four production shovels, 18 CAT 777, 8 CAT 773 trucks as well as seven drill rigs in readiness for drill and blast operations, which are due to commence during Q3 2015. Mining activities are operating 24 hours a day and production levels have reached 100,000 tonnes per day, which is approximately 10% above the planned mining rates.

The contractor has mined 7.9 million tonnes ("Mt") from the pit as at the end of June, representing 36% of the planned pre-strip. Approximately 20,803 tonnes of ore at a grade of 1.87 g/t have been mined during the pre-strip and have been placed on the run-of-mine pad. Prior to milling operations commencing in Q1 2016, it is planned to have 423,000 tonnes of ore grading 2.09 g/t on the stockpiles.

Pit dewatering has continued to advance ahead of the mining operations with 3.36 million cubic metres of the expected 6 million cubic metres of water now pumped from the Nkran pit (approximately 56%). Since the start of dewatering in December 2014, the water level has dropped by approximately 24.3 metres.

Health and Safety

Following the recent fatal accident within the pit all employees and contractors have undergone health and safety re-inductions. In addition, Asanko has investigated the accident and completed a full review of all of its safety and health procedures and processes. Appropriate remedial action plans have been fully implemented.

Procurement

Procurement is practically complete with approximately US$286 million committed to orders and contracts, of which US$138 million has been spent as at June 30 2015. All remaining equipment and materials deliveries, none of which are on the project critical path, are on schedule.

Partial Relocation of Nkran Village

The partial relocation of the Nkran village (88 building structures) continues to progress on schedule. Local contractors are undertaking the construction of the new buildings, with around 450 local villagers being employed on the project. The construction of the housing terraces is complete and 51 house structures have already been built, with 80% of these houses currently being fitted with plumbing and electrics. An additional 37 houses are between foundation and lintel level. Asanko is also building a community center, a school and a football field. The relocation remains on track for completion by the end of Q3 2015.

Source: http://www.asanko.com/

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