Trading Update for the Second Half of 2007

07.02.2008

Highland Gold Mining Ltd Announces Second Half 2007 Trading Update

HIGHLIGHTS

  • Millhouse LLC completes the purchase of 130,100,000 new ordinary shares at a price of 151 pence per share providing approximately US$400 million in new equity capital
  • MNV production of 156,490oz Au - within the forecasted range for the year
  • Strong Q4 production results at MNV with 67,143oz Au recovered underline the efficiencies gained from the initiatives implemented
  • At Novoshirokinskoye, construction is well underway at the processing plant, and the majority of infrastructure facilities have been built and commissioned
  • Draft Feasibility Study completed at Mayskoye, presently under internal review and will be finalised during Q1 2008
  • Steady progress made at all exploration sites in the Highland Gold portfolio

Commenting on today’s announcement, Henry Horne, Managing Director, said:

"We have continued to upgrade the operations at MNV successfully and as a result the mine finished 2007 with a total production of 156,490oz Au, which was within the forecasted range. We have concluded an important agreement with Millhouse LLC who is now our largest shareholder. We have achieved steady progress on all of our development and exploration projects and we also have successfully divested Darasun. The Group is now well positioned and we are looking with confidence to the future".

CONFERENCE CALL

Highland Gold will hold a conference call hosted by Henry Horne, Managing Director, John McDonough, COO, Chris Bostwick, Director Capital Projects and Werner Klemens, Director Exploration to discuss this trading update. The conference call will take place at 14:00 UK time (17:00 Moscow) on Thursday, 7 February 2008. To participate in the conference call, please dial one of the following numbers:

+44 (0) 1452 555 566 International dial in number
   
8108 0020 972 044 Russia free call
   
0800 6940 257 U.K. free call
1866 966 9439 USA free call

Participants will be asked of their full name and Conference ID which is 34403428.

A replay of the conference will be available after the call’s completion for a period of one week by calling one of the numbers below and quoting replay access number 34403428#:

+44 (0) 1452 55 00 00 International dial in
   
0800 953 1533 U.K. free call dial in
   
1866 247 4222 USA free call dial in

A Wav file of the recorded conference call will be available at www.highlandgold.com.

For further information please contact:
Highland Gold Mining Henry Horne, Managing Director, Moscow - +7 495 777 5529
Dmitry Yakushkin, Director of Communications - +7 495 777 3155
Duncan Baxter, Corporate Affairs Director - +44 (0)1534 814 202
Dominic Palmer-Tomkinson - +44 (0) 207 239 0149
JPMorgan Cazenove
(Nominated Adviser)
Michael Wentworth-Stanley, Managing Director
Sam Critchlow - +44 (0) 207 588 2828
Fin Public Relations Alex Glover - +44 (0) 207 608 2280

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