Big boost for Youga

Etruscan Resources has received an offer of debt financing aggregating $33.5 million from the FirstRand Bank Group of South Africa and Macquarie Bank of Australia to complete the construction of the Youga gold mine in Burkina Faso. The project lies some 4 km north of the Ghanaian border and 180 km southwest of Ougadougou, the capital city. Etruscan holds a 90% interest in Youga, with the Government of Burkina Faso holding the remaining 10%. Youga presently has a mineable gold reserve of 6.6 Mt at an average grade of 2.7 g/t. The initial open-pit operation will comprise five pits with the ore being processed through a conventional gravity-CIL (carbon-in-leach) plant with a design capacity of 1 Mt/y over an initial 6.5 year mine life. The total project funding requirements including financing costs are estimated at $44 million and will be funded through a combination of debt and equity financing.

During 2005, Etruscan financed and carried out development work on the project including the upgrading of the 30 km main access road from the town of Zabre to the mine site, terracing and compaction of the plant site, surveying and clearing of the 11-km water pipeline route from the site to the year-round water supply at the Nakambe River, and upgrading of camp and airstrip infrastructure. Certain long-lead items were also purchased or ordered including a Metso Minerals (Allis Chalmers) ball mill from the Louvicourt mine in Val d’Or, Quebec. Etruscan is continuing with engineering and design of the Youga CIL plant and related facilities and construction is now anticipated to be completed in early 2007.

Etruscan’s mine development strategy is to build a centrally located processing facility within a district scale gold belt and it continues to evaluate other near-surface mineralized zones that can provide additional mine reserves.