Frontier Mining confident all is in place to turn Benkala deposit into company-transforming asset

Kazakhstan focused Frontier Mining Ltd (AIM: FML) said that with sufficient financing in place and cash flow from its Naimanjal gold and silver assets, it is confident everything is in place to turn its flagship Benkala copper-molybdenum-gold deposit into the company transforming asset Frontier believes it to be.

In its interim results sstatement, it said the final quarter of 2009 will be a busy one for Frontier as it pushes forward with production at Naimanjal, development and construction at the Koskuduk gold-silver-lead-zinc discovery and the progression of regulatory approvals.

The group widened its pretax loss to US$1.9 million in the first half to June 30 2009 from US$1.42 million a year earlier.

Benkala remains the key driver in bringing the company into significant revenue streams in the short to medium term. The management of KazCopper, the 50 percent held joint venture that owns the Benkala project, is focused on progressing towards full feasibility, production and near term-cash flow in 2011. Frontier continues to explore funding options to accelerate the development of this site which could enable production within a shorter time scale.

An additional 39 holes totalling approximately 5,000 metres remain to be completed for the JORC resource statement. The resultant JORC compliant resource statement is anticipated to be completed early in the second quarter of 2010.

Mining operations at Naimanjal restarted in June and to date 109,004 tonnes of ore with an average grade of 1.2 grams per ton has been stacked on the leach pads. Production has commenced and 1,499 ounces of gold and 4,886 ounces of silver have been produced generating US$1,570,000 revenue to date. Frontier now anticipates that an additional 2,000 ounces of gold will be produced in 2009.

Frontier has received local authority confirmation of both the extension of its pilot production license at the Naimanjal complex and of approval to start pilot production at Koskuduk, Beschoku and Yubileiny with formal ministry approval expected in October.

As previously stated the company has submitted its application for full commercial production at Naimanjal and this remains on track. It expects news on its application by the end of 2009.

With production restarted at Naimanjal, management will focus on bringing the Koskuduk deposit into production. Frontier is planning to prepare it over the 2009/2010 winter period in order for production to commence in the second quarter of 2010.

A crushing operation, leach pads and a production facility will be built on location with initial construction to begin in October 2009. Construction will continue through the winter period allowing a planned production start-up in April 2010.

Frontier added it continues to review options for the Beschoku deposit, to finalise processing technology with the goal of bringing it into production in late 2010/2011.

Chairman and CEO Erlan Sagadiev commented: “The company's financing activities in the first six months of 2009 have laid a firm foundation for Frontier to concentrate on progressing development at its Benkala joint venture and continue further developing the company's income generating assets at Naimanjal. I am confident that the company's plans will continue to build significant shareholder value in the short to medium term and beyond.”