tam increases resources

WESTERN TANAMI RESOURCE INCREASES 31% TO 554,700 OUNCES
Total Resource for Tanami Operations now over 1.61Million Ounces

Australian gold producer Tanami Gold NL (ASX: TAM1) is pleased to announce an updated Mineral Resource estimate for its Western Tanami Gold Operations (Western Tanami), has leapt by 31 per cent to 554,700 ounces.

The upgraded figure comprises 3.12 million tonnes grading 5.5g/t (see Table 1) and represents a 31% increase on the previous estimate at 30 June 2009 (see Table 2) after taking into account the record 47,960 ounces produced for the year ended 30 June 2010.

The 132,700 ounce increase in Resource resulted from a successful campaign of diamond and reverse circulation drilling at key deposits within the project area.

The Company now has total Measured, Indicated and Inferred Resources at its Western and Central Tanami projects of 14,796,000 tonnes grading 3.4g/t for 1.616 million ounces.
Underground diamond core drilling at the Coyote Mine has delineated additional high grade mineralisation at Bommie and South Zone which has contributed significantly to the Coyote Resource.

Coyote total Measured, Indicated and Inferred Resources increased by 66,000 ounces after mining depletion of 39,000 ounces.

In addition, surface diamond core drilling at the Sandpiper deposit has delineated a further 65,000 ounces of Indicated and Inferred Resources by extending mineralisation over 400 metres down-plunge from the base of the Sandpiper open pit with mineralisation remaining open at depth.

The discovery cost of the additional Resource is approximately $24 per ounce.
Western and Central Tanami Exploration
Ongoing surface reverse circulation and diamond core exploration drilling at the Companys Western and Central

Tanami project areas continues to deliver encouraging results.
At Western Tanami, recent assays received from drill hole HFRC1 at the Hutchs Find prospect, located 22 kilometres southwest of the Coyote treatment plant, include:-
2m @ 3.7g/t Au from 64 to 66 metres
19m @ 2.3g/t Au from 98 to 117 metres
10m @ 5.4g/t Au from 123 to 133 metres (including 5m @ 9.6g/t from 123 metres)
Refer Figure 1 and Table 4.

This mineralisation is related to abundant quartz stringer veins hosted within foliated micaceous sandstone and siltstone. Follow-up drilling is planned for this prospect.
Tanami Gold NL 2

Underground diamond drilling is expected to resume at Coyote during the December 2010 Quarter to test a number of high grade targets adjacent to existing mineralisation. Resource definition drilling programs will also be undertaken within the Coyote system.

At Central Tanami, reverse circulation and diamond core exploration drilling continues at a high level of activity with prospective structure and alteration intersected in many of the holes completed to date. A large number of assays are pending with assay turn-around time steadily improving. An update on the Central Tanami drilling campaign is expected to be released shortly.