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First Uranium doubles gold production capacity at Mine Waste Solutions operation in South Africa

Posted on: Friday, 4 September 2009, 11:30 CDT

TORONTO and JOHANNESBURG, Sept. 4 /PRNewswire-FirstCall/ - First Uranium Corporation (TSX:FIU, JSE:FUM) (ISIN:CA33744R1029) ("First Uranium" or "the Company") today announced the startup of the Company's second gold plant (Phase 1B) at its Mine Waste Solutions tailings recovery operation ("MWS") in South Africa. Having met design specifications for throughput and gold recovery rates, the new gold plant has a production life expectancy of 15 years. Over the next 12 months beginning October 1, 2009, the new gold plant is expected to produce approximately 55,000 ounces of gold.

"The additional cash flow from doubling gold production at MWS is expected to partially offset the necessary capital expenditures to complete the expansion of the MWS operation," said Gordon Miller, First Uranium's President and Chief Executive Officer. "We believe that the cash resources of $123 million at June 30, 2009 and the cash forecast to be generated from the sale of gold and uranium, together with the ZAR160 million (approximately $20 million) Simmer and Jack Mines credit facility, will be sufficient to fund the completion of the current capital projects at the Company's two operations. To provide a buffer in the event of a funding shortfall due to volatility in uranium and gold prices, exchange rates or production rates, management is in discussion to advance its long-standing intention to secure a project financing facility for MWS in South Africa."

In the last fiscal quarter, MWS's Phase 1A gold plant produced 11,007 ounces of gold at a Cash Cost(1) of $338 per ounce, placing the MWS operation among the lowest cost gold mines in South Africa.

"We are confident that our Phase 1B uranium plant and the third and final gold plant will be completed on schedule for their planned startups in December 2009 and by June 2010, respectively," said recently appointed MWS Chief Operating Officer Scot Sobey. "The efficiency of gold recovery at our existing Phase 1A gold plant improved by 9 per cent so far this quarter, and is expected to increase again during September. Gold recovery and unit operating costs at both gold plants are expected to improve even further when these plants begin to operate in series with the Phase 1B uranium plant, which we plan to begin operating in December 2009."

Notes: 1. "Cash Costs" are costs directly related to the physical activities of producing gold and include mining, processing and other plant costs; third-party refining and smelting costs; marketing expense, on-site general and administrative costs; royalties; on-mine drilling expenditures that are related to production and other direct costs. Sales of by-product metals are deducted from the above in computing cash costs. Cash costs exclude depreciation, depletion and amortization, corporate general and administrative expense, exploration, interest, and pre-feasibility costs and accruals for mine reclamation. Cash costs are calculated and presented using the "Gold Institute Production Cost Standard" applied consistently for all periods presented. The Gold Institute was a non-profit industry association comprised of leading gold producers, refiners, bullion suppliers and manufacturers. This institute has now been incorporated into the National Mining Association. The guidance was first issued in 1996 and revised in November 1999. Total cash costs per ounce is a non-GAAP measurement and investors are cautioned not to place undue reliance on it and are advised to read all GAAP accounting disclosures presented in the Company's audited consolidated financial statements for FY 2009 and accompanying footnotes thereto.

Cautionary Language Regarding Forward-Looking Information

This news release contains and refers to forward-looking information based on current expectations. All other statements, other than statements of historical fact, included in this news release including, without limitation, statements regarding processing and development plans and future plans and objectives of First Uranium are forward-looking statements (or forward-looking information) that involve various risks and uncertainties. These forward-looking statements are made as of the date hereof and there can be no assurance that such statements will prove to be accurate, such statements are subject to significant risks and uncertainties, and actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements that are included herein, except in accordance with applicable securities law.

About First Uranium Corporation

First Uranium Corporation (TSX:FIU, JSE:FUM) is actively pursuing its goal of becoming a significant low-cost producer of uranium and gold through the expansion of the underground development to feed the new uranium and gold plants at the Ezulwini Mine and through the expansion of the plant capacity of the Mine Waste Solutions tailings recovery facility, both located in South Africa. First Uranium also plans to grow production by pursuing value-enhancing opportunities in South Africa and elsewhere.

To view a picture of "Mine Waste Solutions Phase 1A gold plant, Phase 1B gold plant and flotation plant as of early August 2009" please click on http://files.newswire.ca/589/MineWasteSolutions.doc

SOURCE First Uranium Corporation

Source: PR Newswire

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