GLOBAL GOLD TO INVEST $7.1 MLN IN ARMENIAN GOLD DEPOSIT IN 2006-2007

Interfax News Agency
Russia & CIS Business and Financial Newswire
April 25, 2006 Tuesday 12:47 PM MSK

Global Gold Mining will invest $7.1 million in the Tukhmanuk gold
deposit in northern Armenia in 2006-2007, the U.S. company’s regional
director, Ashot Pogosian told Interfax.

The company will invest $3.8 million in operations and $3.3 million in
exploration, he said. The deposit will be open-cast mined for the first
two years, and then the company will switch to deep mining, he said.

He also said the project must undergo an environmental impact study
and technical assessment.

Pogosian said that a contract will hopefully be signed in May and
operations at the deposit will begin. The deposit will only be mined in
summer due to the harsh local climate, and ore will then be processed
at a nearby beneficiation plant for the rest of the year.

Tukhmanuk has proven reserves of 8 tonnes of gold and is potentially
the country’s second largest gold deposit after the Sotk field, said
Global Gold chief geologist Genrikh Mkrtchian, who is also a member
of the State Mineral Reserves Commission.

The company plans to mine about 150,000 tonnes of ore over two years
and produce about 800 kg of gold and 2,400 kg of silver, he said.

The open-cast mine will employ about 90 people, and the beneficiation
plant will have about the same number of workers.

The plant will use gravitation technology, without chemical substances,
so it will have minimal environmental impact, Mkrtchian said. This
deposit was operated on a trial basis two years ago, when about 930
tonnes of ore were mined with average gold content of 6.61 grams
per tonne.