Ann: Production Increased, page-16

*s t o c k h e a d article this morning mentioned KAU

Unlike many junior gold plays, Kaiser Reef has distinguished itself by having already established profitable production from its A1 Mine, selling 3,376oz of gold at an average price of $2,807/oz in the March quarter for $9.48m in revenues versus total costs of $8.09m.

And it is now poised to take production even higher after completing significant debottleneck and infrastructure improvements such as modernising the SAG milling operation to ensure the plant could be operated and maintained more effectively, expanding the underground remote mining fleet, improving ventilation infrastructure and accessing ore bodies developed over the previous quarter.

The company is clearly confident enough in all this activity that it is projecting a doubling in mine output from the current 2,000t to 2,500t per month to between 4,000t and 5,000t.

Recent drilling has also delivered exceptional results including 4.4m @ 118 g/t gold from 25.4m, 1.75m @ 53.8 g/t gold from 40.9m, 15.20m @ 3.01 g/t gold from 51.4m and 0.25m @ 2,006 g/t gold from 66.65m which bodes very well for the ongoing exploration and mine development.

This will go a long way towards ensuring the company has sufficient resources to continue feeding its production operations.