Central Sun Corporate Strategy Update
October 20 2008 - 12:44PM
Marketwired
Central Sun Mining Inc. ("Central Sun" or the "Company") (TSX:
CSM)(TSX: CSM.WT)(NYSE-A: SMC) is pleased to provide the following
update with respect to the corporate strategy and vision for the
Company.
Central Sun is a producing gold mining company which currently
operates the cash flow positive Limon Mine in Nicaragua. The
Company also owns the Orosi Mine which is in the final stages of
construction which was expected to be completed and operating at
the end of the first quarter of 2009. To date the Company has spent
approximately US$31million of the required US$47 million to
complete the project.
Central Sun had previously entered into a non-binding term sheet
with an international bank with respect to a US$22.5 million debt
financing to complete the Orosi Mine Expansion Project. Due to the
current global financial situation, the banking institution was
unable to proceed with the debt financing.
In order to react expeditiously to this unexpected situation,
the Company will be implementing the following strategy:
- The company is continuing active discussions with various
other financial institutions with respect to debt financing for the
project including ongoing discussions with our current bridge loan
lenders.
- The Orosi Mine Expansion Project will be temporarily suspended
in order to facilitate a quick reactivation once the required
funding is secured.
- The Company will continue to operate the cash flow positive
Limon Mine in an efficient manner.
- The Company will implement various cost cutting reductions
throughout its activities, where necessary.
Peter Tagliamonte, President and CEO commented, "Central Sun has
unfortunately been negatively impacted by the current financial
situation. We are fortunate to have a cash flow positive Limon mine
that will support the company's normal activities as we temporarily
cease capital expenditures on the Orosi Mine project. We continue
to work diligently to secure the required funding to restart and
complete the Orosi Mine Expansion Project. We are confident that we
will be successful, as the Orosi Mine Project is very advanced with
approximately 6 to 7 months remaining to bring the mine back into
operation at a production rate of 80,000 ounces per year. Central
Sun has had excellent exploration success this year at both the
Limon and Orosi mines and we will be providing a year end
exploration update in the upcoming weeks. The necessity to suspend
the Orosi Project is a disappointing decision that had to be made
but we have a strong and dedicated team that will manage Central
Sun through this challenging period."
About Central Sun Mining Inc.
The Company is a growing gold producer with mining and
exploration activities focused in Nicaragua. The Company operates
the Limon Mine in Nicaragua and is converting the Orosi Mine in
Nicaragua to conventional milling to increase the annual gold
output. It also holds an option to acquire a 100% interest in the
Mestiza gold property which is located 70 kilometres by road east
of the Limon Mine. The Company is focused on efficient and
productive mining practices to establish high quality and cost
effective operations. Central Sun Mining Inc. is committed to
growth by optimizing current operations, expanding mineral reserves
and resources at existing mines, exploring its extensive land
holdings and seeking strategic mergers or acquisitions in the
Americas.
Cautionary Note Regarding Forward-Looking Statements: This news
release contains certain "forward-looking statements", within the
meaning of the United States Private Securities Litigation Reform
Act of 1995, and "forward-looking information" under similar
Canadian legislation, concerning the business, operations and
financial performance and condition of the Company. Forward-looking
statements and risk factors include, but are not limited to,
statements with respect to the implementation of the Company's
strategic plan; the future financial or operating performance of
the Company, its subsidiaries and its projects; the future price of
gold; expectation that the Orosi Mill feasibility study will be
positive; capital requirements for completion of the Orosi Mill
project; successful implementation of the Orosi Mill project; the
estimated Orosi Mill recovery rates; the estimation of mineral
reserves and resources, the realization of mineral reserve
estimates; the timing and amount of estimated future production;
costs of production; operating and exploration expenditures; mining
or processing issues; costs and timing of the development of new
deposits; costs, timing and success of future exploration;
government regulation of mining operations; permitting time lines
and permitting; labour disruptions; environmental risks;
unanticipated reclamation expenses; title disputes or claims;
limitations on insurance coverage; and the timing and possible
outcome of pending litigation and regulatory matters. Generally,
forward-looking statements can be identified by the use of
forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "anticipates" or "believes" or variations of such
words and phrases or statements that certain actions, events or
results "may", "could", "would", "might" or "will be taken",
"occur" or "be achieved".
Forward-looking statements are based on the opinions and
estimates of the Company as of the date such statements are made,
and they are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of the Company to be materially
different from those expressed or implied by such forward-looking
statements, including but not limited to: general business,
economic, competitive, political and social uncertainties; the
actual results of current exploration activities; actual results of
reclamation activities; conclusions of economic evaluations;
changes in project parameters as plans continue to be refined;
future prices of gold; possible variations of ore grade or recovery
rates; failure of plant, equipment or processes to operate as
anticipated; accidents, labour disputes and other risks of the
mining industry; political instability, insurrection or war; delays
in obtaining governmental approvals or required financing or in the
completion of development or construction activities, as well as
those factors discussed in the section entitled "General
Development of the Business - Risks of the Business" in the
Company's annual information form for the year ended December 31,
2007 on file with the securities regulatory authorities in Canada
and the Company's Form 40-F on file with the Securities and
Exchange Commission in Washington, D.C.. Although the Company has
attempted to identify important factors that could cause actual
results to differ materially from those contained in
forward-looking statements, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can
be no assurance that such statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements. The Company
does not undertake to update any forward-looking statements that
are incorporated by reference herein, except in accordance with
applicable securities laws.
Contacts: Central Sun Mining Inc. Peter W. Tagliamonte President
and CEO (416) 860-0919 Central Sun Mining Inc. Denis C. Arsenault
CFO (416) 860-0919 (416) 367-0182 (FAX) Email: ir@centralsun.ca
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