Sumatra Cooper & Gold: Company annual accounts and project update

(March 31, 2014) -- Sumatra Cooper & Gold Plc is pleased to provide an update on its activities at the Tembang Project in conjunction with the release of its annual financial statements for year ended 31 December 2013.

Progress on Update Mine Plan for Tembang
In December 2013 the Company halted construction activities at Tembang and commenced a three month ?Phase 3? drill program with the objective of defining additional Measured and Indicated Resources at the Project in accordance with the JORC Code 2012 which became mandatory for all ASX-listed companies on 1 December 2013. The Company announced the completion of the Phase 3 drill program on 10 March 2014.

On 19 March 2014 the Company announced a Mineral Resource estimate update and on 25 March 2014 publish an updates Ore Reserve estimate. Following the completion of these activities the Company is finalizing its updated Feasibility Study for Tembang which it plans to release in early April 2014.

Funding
The Company has appointed an Independent Technical Advisor to review the Company?s updated (?Independent Review?). The Independent Review is well advanced and is expected to be completed in mid-April 2014. It will provide the basis for final credit committee approval to be sought for debt funding for Tembang. The Company is in advanced negotiations to secure debt funding of up to US$30 million and acticipates obtaining credit approval and recommencing construction in Quarter 2, 2014.

The Tembang Project is fully permitted with the final material permit, the Pinjam Pakai or ?Borrow and Use? Forestry permit, being granted on the 27th April 2013. The Tembang Project was granted a 20 year mining lease to the Company?s 100% Indonesian Subsidiary, PT Dwined Nusa Sejahtera, in early 2012. Tembang will produce a gold silver dore which will be refined to LBMA certified gold and silver at the Logan Mulia Refinery in Jakarta. The three largest shareholders of the company, who collectively own in excess of 51% of the shares in the Company, are all Indonesian owned entities. Sumatra Cooper and Gold plc is therefore well positioned to avoid both major issues that have been effecting Indonesian mining companies, namely the value-add of products in Indonesia? and the 51% Indonesian ownership issue.

The Company has appointed Patersons Securities Limited to act as Lead Manager on a ?best endeavours? basis to assist the Company to raise equity as part of the total Project funding package. The quantum, price and timing of the proposed equity raise are yet to be determined. The Company?s major shareholders are expected to support the equity raise.

Further updates in regards to the Project funding will be provided in due course.

Financial Results
Due to the substantial decline in gold and silver prices during calendar year 2013, and the Company?s subsequent decision to use a significantly lower gold price to optimize its mine plan, the Company has booked a non-cash impairment charge of US$8.6 million relating to historical exploration expenditure at Tembang. The Company considers the decision to charge an impairment to be prudent in the context of th current market environment and believes that significant additional longer term value will be derived from both the development of Tembang and exploration upside. (ends)