Kimberley Metals Limited Mineral Hill Mine Progress Towards Mid-2011 Production Target

10:17 AEST Mar 29, 2011 ABN Newswire (C) 2004-2011 Asia Business News PL. All Rights Reserved.

Sydney, Australia (ABN Newswire) - Kimberley Metals Limited (ASX: KBL) is pleased to report on progress in the refurbishment of the Mineral Hill Mine, located 65 kilometres north of Condobolin in centralwestern New South Wales.

The Company has been engaged in refurbishing the processing plant at Mineral Hill, which operated under previous owners from 1989 to 2005, since August 2010 in preparation for a recommencement of production from the mine with first production targeted for mid-2011.

Kimberley\'s development plan for Mineral Hill contemplates the development of both the Parkers Hill underground copper-lead-zinc mine and the Pearse open-cut gold-silver mine. The Mineral Hill plant has two process trains, allowing the treatment of gold-dominant ores through a carbon-in-leach circuit and base metal ores through a flotation circuit.

The current focus of work at Mineral Hill is to achieve first production of copper concentrates from Parkers Hill, for which operating approvals are in place, from mid-2011. In parallel, permitting processes for the Pearse development are at an advanced stage.


Parkers Hill Underground Mine

Kimberley has appointed mining contractor Pybar to provide underground mining services at Parkers Hill, with the Pybar team on site since early December 2010.


Key works completed to date are:

- Establishment of primary ventilation, power and air services to the underground mine

- With water levels in the decline now below the access level to the Parkers Hill development, dewatering activities are now focussed to further lower water levels to access deeper areas of the mine for exploration and assessment

- Jumbo mobilised to site in readiness for mine level development

- All ground support installed to the explosives magazine in the Jacks Hut Decline

- All remedial road works and the commencement of remedial ground support in the decline to the Parkers Hill access drive on 190 level

- Completion of rehabilitation of the Portal .

The following works remain to be completed prior to initial ore production, which is anticipated at midyear.

- Completion of minor ground support by bolting and meshing in selected areas of the decline drive to 190 level as identified by external geotechnical advice. The first development cut is expected to be achieved in three weeks;

- Completion at the 225 level of a new, 185 metre long, drive (5x5 metres) to connect to the ventilation fan raise to provide fresh airway for the new stopes.

- Development works associated with the first stope to be established between the 180 and 225 metre levels.


Processing Plant


Key works completed to date are:

- Refurbishment of the crusher feed bin

- Refurbishment of all feed chutes, the primary crusher, and secondary crusher

- Installed new soft starter and completed electrical upgrade for the crushing plant

- Reconditioned and installed primary crusher motor

- Rebuild of the interstage screen and feed chutes

- Installed structural steel to conveyors

- New conveyor belt installed on CV-03 to the fine ore bins

- New working platform atop the fine ore bins

- Full refurbishment of steel structures around the mills

- 20 new flotation cells built

- New bearings ordered for Mill 1 and on-schedule for delivery end April

- New girth gear and pinion bearing for Ball Mill 2 - casting completed and fabrication in progress - on target for delivery and installation in May 2011

- New gridmesh walkways, handrailing, and guarding for the crushers, interstage screen, and flotation area completed to current Australian Standards


The following works remain to be completed prior to commissioning, which is anticipated to commence at mid-year:

- Fine Ore Bins & Mills

- Upgrade the feeder system for both fine ore bins;

- Replace bearings on Ball Mill 1 and replace girth gear and pinion bearing on Ball Mill 2;

- Internal refurbishment and lining of both mills;

- Install new cyclones;

- Re-belt conveyors and replace motors, rollers;

- Guarding and electrical upgrades to bring to current Australian Standards;

- Acquisition of ROM mobile loader.

- Flotation

- Add structural beam to complement support structures;

- Install the newly fabricated 20 float cells including mechanisms, piping, motors and pumps;

- Construction of reagent storage and mixing area;

- Install and commission bagging plant.

- Processing

- Install in-line analyser across the plant;


Complete installation of new process control system (PLC);

- Finalise sales agency arrangements and export logistics including Material Data Safety

Sheet;

- Establish safe operating policies and procedures for operations.

- Recruitment

- Recruit remainder of operations workforce to fill some 40 positions.

- Assisted by technical and specialist support from local steel fabricators and construction groups, a plant refurbishment team of experienced fitters boilermakers and maintenance workers has been employed by Kimberley since August 2010. The majority of work completed -to-date has been achieved by this team which, on plant start up, will transfer to plant maintenance and production

The refurbished mill is expected to have a capacity of 250,000 tonnes per annum when completed, up from the previous 200,000 tonnes per annum capacity.


Pearse Open Cut

The Environmental Impact Statement for the development of the open cut mine and associated activities at the high grade Pearse gold-silver deposit is being finalised and will now be submitted to the Lachlan Shire Council and authorities mid-April. Once development approvals are in place, a program will be developed to co-ordinate the stripping of the open cut and upgrading of the carbon-in-leach circuit at the Mineral Hill plant.

Kimberley Executive Chairman, Jim Wall, commented that \'it is extremely pleasing to see rapid progress at Mineral Hill. The team is coming together well and we remain on track for our target of mid-2011 production.\'

Kimberley will provide regular updates on progress towards completion of these items progressively during the period prior to commissioning.


About Kimberley Metals Limited:

Kimberley Metals Limited (ASX: KBL) is an Australia-based company and primarily involved in mineral exploration and resource investment. The Company's operations include Mineral Hill Mine, Pearse Gold Project, Parkers Hill, Sorby Hills Project and Constance Range Iron Ore Project.



Contact:

Jim Wall
Executive Chairman
Kimberley Metals Limited
Tel: +61-2-9927-2005

Stuart Mathews
Chief Operating Officer
Kimberley Metals Limited
Tel: +61-2-9927-2003
http://www.kimberleymetals.com.au