Trading Update for the First Half of 2008

12.08.2008

Highland Gold Mining Limited (“Highland Gold”, or the “Company”) provides its trading update for the half year ended 30 June 2008. Full financial results for this period will be released on 25 September 2008.

View the full announcement (PDF - 206 Kb)

HIGHLIGHTS

  • Mnogovershinnoye produced 68,813 oz of gold, an 18% increase compared toH1 2007 and on course to achieve target range of 155,000 to 165,000 oz for 2008
  • Novoshirokinskoye on schedule for commissioning at the end of 2008 and due to enhance Company cash flows in 2009 from an additional 30,000 gold-equivalent ozwith an estimated 50,000 oz on average per annum thereafter
  • Construction works at the Company’s flagship development project Mayskoye to start in September 2008 leading to production from 2011 with estimated 250,000 + oz on average per annum
  • Taseevskoye - technical studies underway to prepare feasibility study and license requirements for start-up extended to 2013 allowing for a more favorable development programme

Duncan Baxter, recently appointed Chairman said: “In the first half of 2008 we have achieved the two important goals of bringing more structure to our development programme and maintaining our production profile. We have also restructured our Board which now has additional depth of experience of both the mining industry and of Russia. I wish to thank the previous board members for their contribution throughout this period. I look forward to working closely with the new board and the executive management team.”

Commenting on today’s announcement Henry Horne, Chief Executive Officer said: “We have made strong progress with production performance at Mnogovershinnoye and have increased output whilst continuing to take steps to improve these further. The commissioning of Novoshirokinskoye towards the end of this year is a significant milestone making it our second producing mine and one that will make a contribution to revenues early next year. The start of construction works in September at Mayskoye, one of Russia’s largest undeveloped gold resources, is of equal importance to the future of Highland Gold.”

For further information please contact:

Highland Gold –
Henry Horne, Chief Executive Officer, Moscow - +7 495 777 5529
Dmitry Yakushkin, Head of Communications - +7 495 777 3155

Fin Public Relations –
Alex Glover - +44 (0) 207 608 2280

Smith’s –
Dominic Palmer-Tomkinson - +44 (0) 207 239 0140

JPMorgan Cazenove (Nominated Adviser) -
Michael Wentworth-Stanley, Managing Director
Sam Critchlow - +44 (0) 207 588 2828