Jabal Sayid Exploitation (Mining) Licence Granted 24 May 2010 Citadel Resource Group Limited is pleased to announce that the Exploitation (mining) Licence for the Jabal Sayid copper and gold project has been granted. Jabal Sayid is located in the Kingdom of Saudi Arabia and is owned by Citadels Saudi joint venture company Bariq Mining Ltd. Citadels Managing Director, Ins Scotland said, This is a critical milestone for the Company. Completing the technical, commercial and administrative activities required to qualify for an exploitation licence demonstrates our ability to effectively operate in the region. Importantly, it means the development of Saudi Arabias first base metals mine, Jabal Sayid, can begin immediately. We have already completed a significant amount of the early engineering and key contracts have been negotiated for long lead items, underground mining, EPCM and power. This is not only an important step in Citadels growth, but it is a significant move by the Kingdom of Saudi Arabia in furthering the development of a regional mining industry. Granting of Exploitation (Mining) Licence Under the Mining Investment Law, the Exploitation (mining) Licence issued by the Deputy Ministry of Mineral Resources in Saudi, has a 30 year term (renewable) and includes copper, zinc, gold, silver and other metals. There are no mineral royalties payable and the corporate tax rate is 20%. The surface rental is SAR 10,000 per sqkm per annum (approximately A$3,200 on current exchange rates). The Licence was granted to Bariq Mining Ltd of which Citadel owns 50%, with the other 50% owned by Consolidated Mining Company Investments. Page 2 Jabal Sayid Project The Jabal Sayid copper and gold project is located in Saudi Arabia in the Arabian Shield, a highly prospective area larger than the Yilgarn in Western Australia. Jabal Sayid is 350km northeast of Jeddah and is connected to Jeddah and the Red Sea port of Yanbu by multilane sealed highways. The key elements of the Jabal Sayid project as announced on 14 December are: Resource: 31Mt at 2.3% Cu, 0.3g/t Au, 10g/t Ag (Lodes 2 & 4 only, using a 0.8% copper cut-off) Pre-production Capital Cost: US$280M ($222M capital, $38M contingency, $20M owners costs) Cash Cost (1): Payable US$0.97/lb (after precious metals credits), Produced US$0.94/lb Mining Method: Sub level open stopes mining 2.6Mtpa of ore over a 10 year initial mine life Concentrate: Average 250,000 WMT per annum concentrate containing 57,000tpa copper plus payable gold and silver Note (1): Based on a TC/RC of US$70/US$0.07 and credits calculated at a gold price of US$850/oz and silver at US$12.00/oz. More detail is available from the ASX Release dated 14 December 2009. Citadel appreciates the diligence of the Minister and staff of the Ministry of Petroleum and Mineral Resources of Saudi Arabia and the Deputy Ministry of Mineral Resources in progressing and finalising the Exploitation Licence Application and for their ongoing support for the Jabal Sayid Project. Citadel also wishes to thank our Joint Venture partners, the staff of the Australian Embassy in Riyadh, our engineers, SNC-Lavalin and our many service providers within Saudi Arabia and internationally for their support. For further information please contact: Ins Scotland (CEO & MD) (who is currently in Saudi Arabia); or Peter Lester (Executive Director) Citadel Resource Group Limited
CGG Price at posting:
29.6¢ Sentiment: Hold Disclosure: Held
