Straits reports Q2 C.Kalimantan gold output, exploration

The following is an excerpt from Straits Asia Resources on Central Kalimantan gold project, taken from the quarterly report ended June 30, 2009 released on Wednesday.

The Mt Muro operation produced 8,597 ounces of gold and 55,776 ounces of silver, during the Jane 2009 Quarter (10,180 oz Au & 54,185 oz Ag in the March 2009 quarter). As a result of the reduced production performance brought about by a range of operating bottlenecks, cash costs increased for the quarter to US$1,106 per ounce.

Extensive planning and re-evaluation has recently been completed and commitment has been made to a production plan at the Mt Muro operation based around the development of the Serujan open pit, the Berinjin and Merindu elluvial mines and the Soan deposit which is forecast to deliver 320,000 recovered gold equivalent ounces over a minimum five year time frame. Integral to the plan is the decision to recapitalise the mining and transport fleet and moving to an owner operate strategy during the second half of 2009.

Under this plan, it is expected that in excess of 68,000 gold equivalent ounces will be produced in FY09/10 at an average cash operating cost of US$620 per ounces and reducing thereafter.

QUARTERLY PRODUCTION STATISTICS
	Units	June Qtr 2009	March Qtr 2009	12 month to June 2009
Ore Milled	tonnes	136,804	138,185	652,048
Gold grade	g/t	2.04	2.59	2.61
Silver grade	g/t	16	17	25
Gold recovery	%	94.1%	85.8%	90.0%
Silver recovery	%	80.2%	64.5%	60.4%
Production (Gold)*	oz	8,597	10,180	48,846
Silver	oz	55,776	54,185	304,357
Gold Sold	oz	9,034	9,612	48,367
* Production reported is gold poured

Mt Muro (IMK), Central Kalimantan
Straits ? 100%

Exploration activities at Mt Muro have continued with the evaluation of historical targets within the Indo Muro Kencana, (contract of Work (IMKCoW). Newly discovered targets at the Lahung and Untu prospects have been elevated to the level of drill testing.

With the arrival on the site of a track mounted reverse circulation (RC) drill-rig a number of high priority targets are to be drill tested in the coming quarter. The IMK CoW offers excellent exposure to an extremely favourable geological setting containing exceptionally fertile gold bearing structures likely to contain additional high grade low sulphidation epithermal vein systems Total production from the field is now approaching two million gold equivalent ounces. (end of excerpt)