Highland Gold Starts Third Mine in Russia

09.11.2010

Highland Gold Mining Limited ("Highland Gold", or the "Company") announces the commencement of mining at its Belaya Gora open pit operations. Select oxide ores will be hauled to and processed as planned at the Mnogovershinnoye ("MNV") plant. This marks the initial production at Highland Gold's third producing mine just 12 months after commissioning its second producing asset (Novoshirokinskoye) with its joint venture partner in October 2009.

To maximise efficiencies the MNV processing plant gravity circuit is undergoing upgrades that include the incorporation of additional concentrators and in-line leach reactor technology. These upgrades will improve gold recovery levels benefiting both operations.

The Belaya Gora mine is situated 66 kilometres south of MNV and is accessible via an all weather road. In July 2009 the Russian Regulatory Authority (GKZ) approved 820,000 ounces of C1 + C2 reserves and today's announcement is a major milestone for advancing from greenfield exploration into production just five years after the property was purchased at an auction in October 2005.

Design for a stand-alone processing facility at the Belaya Gora mine site is underway with completion of construction scheduled for mid-2012. The plant will process the Belaya Gora ore stockwork in addition to potential ore from nearby satellite deposits at Blagodatnoye and Belaya Gora Flanks, both of which were acquired by the Company earlier this year.

For further information please contact:

Highland Gold Dmitry Yakushkin, Head of Communications + 7 495 424 95 21
  Duncan Baxter, Chairman + 44 (0) 1534 814 202
Matrix Robin Henshall, Partner +44 (0) 20 3206 7172
(Nominated Adviser and broker) Alastair Stratton, Partner +44 (0)20 3206 7204
Fin Public Relations Alex Glover + 44 (0) 20 7608 2280