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Mutiny Gold Rides Crest With Increase In Deflector Production Inventory

Mutiny Gold (ASX:MYG) has lifted its production inventory at the Deflector Gold-Copper Deposit in Western Australia, as well as announce an update to the JORC ore reserve.

Using the August 2012 updated resource model produced by Widenbar and Associates the increases are significant in taking Mutiny further along the road to production.

The Deflector maiden initial Life of Mine production inventory has increased to 552,000 ounces of gold equivalent; including 442,000 ounces of gold, 21,000 tonnes of copper and 491,000 ounces of silver.

This LOM production inventory includes a JORC reserve of 403,000 ounces of gold equivalent.

Mutiny Gold's Managing Director, John Greeve, said the upgraded Deflector LOM production inventory and Ore Reserve supports the Company's vision of being a significant producer.

"This is another significant milestone along the path to the commercialisation of Deflector, which, in turn, is the first step in Mutiny Gold becoming a major new Australian gold and copper producer.

"The new results have identified a 27% increase in gold reserves, while mine inventory in gold equivalent ounces has jumped by 20%. These reserves are the back-bone of an upsized mine plan which we look forward to releasing to the market shortly."

The August 2012 Deflector analysis contains JORC-compliant mineral resources of 2.87Mt @ 6.41g/t gold, 6.82g/t silver and 0.95% copper for 729,000oz of Equivalent gold; including 591,000oz gold, 628,000oz silver and 27,000t of copper using a 0.5g/t gold cut-off grade.

Open pit

The open pit will be mined using 7 pushbacks. Pushback 1 and 2 will be mined first, establishing a small open pit in the south of the operation, giving access to the proposed underground portal location. On the completion of Pushback 1 and 2, the open pit and underground operations can be mined simultaneously.

Analysis

Today's announcement is value accretive for Mutiny as it reaches another milestone in moving to production at Deflector.

There are still significant milestones ahead and catalysts to lift from the current share price of $0.125. These include the conversion of current resource to greater reserves as well as:

- Increase forecast annual production rate

- Completion of project finance

- Commencement of mine pre-strip and plant construction

The transformation from emerging producer to production is on track. Proactive Investors believes Mutiny Goldremains undervalued despite the recent re-rating. We consider a near term price of $0.15 is achievable.

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