The new Bibiani gold mine in Ghana – originally scheduled to produce 40 000 ounces from tailings this year – is expected to increase its 2007 production by 25%, reaching an annualised total of 50 000 ounces.

Confirming this in its latest shareholder update, Central African Gold (CAG) – a four-year-old AIM-listed gold mining and exploration company concentrating on African gold prospects – re-iterates that underground stoping production is expected to reach an annualised rate of an additional 110 000 oz in Q3 of 2008, enabling Bibiani to achieve an annualised production rate of 150 000 ounces at that time.

“Our main emphasis,” the update states, “has been the underground project at Bibiani, while at the same time producing from tailings. We are well on track to exceed our 40 000 ounce prediction with targeted production in FY2007 now being in the region of 50 000 oz of gold from both surface and underground sources” it adds. “We are well on track to achieve this.”

A large component of the CAG mining fleet for the Bibiani gold mine underground project has arrived on site, and is being commissioned by the teams of local and ex-patriot underground bulk mining specialists hired to manage the project. The first trial underground blast and development on ventilation raises has started, and additional general mine development work has been initiated ahead of schedule. Stoping and the build up of underground production is also underway.

The CAG surface drilling programme, while not complete, is showing signs of yielding good results, confirming the continuity of the ore body and supporting the confidence the company has always displayed in the Bibiani gold mine, and the region as a whole.

The shareholder update also reveals that it may be possible to access some areas for mining from the conveyor decline that is planned from the runof- mine pad to below current planned underground mining infrastructure. “Importantly, this could provide an additional unplanned source of ore,” the update continues, “and we look forward to announcing a detailed release on Bibiani in the near future, which will include a revised reserve and resource statement.

The company has increased its measured and indicated gold resources by 26% from 733 000 oz Au contained in 20 533 000 tonnes grading 1.11g/t Au, to 925 000 oz Au contained in 22 871 000 tonnes grading 1.26 g/t Au.

Underground measured and indicated resources are up more than 50% from 359 000 oz Au contained in 2 556 000 tonnes grading 4.37 g/t Au, to 546 000 oz Au contained in 4 288 000 tonnes grading 3.96 g/t.