AuRico Gold Announces Increased Consolidated Production and Reduced Cash Cost Guidance

TORONTO, July 21, 2011 /CNW/ --
Expansion Programs Underway at the El Chanate and El Cubo Mines

TORONTO, July 21, 2011 /CNW/ - AuRico Gold Inc. (TSX:AUQ) (NYSE:AUQ), ('AuRico' or 'the Company') is pleased to announce a positive revision
to its consolidated operational outlook for 2011 that includes an
increase in production and a reduction in cash cost estimates for 2011.
The Company is also providing a status update on progress at the El
Chanate and El Cubo mines.

Our improved operational outlook is supported by the robust performance
continuing to be reported from the flagship Ocampo mine, the expansion
program that has been implemented at the El Chanate mine and the
resumption of commercial production at the El Cubo mine on July 11(th). AuRico has revised its consolidated operational outlook for 2011,
including the reduction in cash cost estimates for Ocampo as announced
on July 12th, as follows:

 __________________________________________________________________
|                2011 Consolidated Operational Outlook Update      |
|                    (Ocampo, El Cubo and El Chanate(3))           |
|__________________________________________________________________|
|                    |      Previous Outlook|       Revised Outlook|
|____________________|______________________|______________________|
|Gold Production     |    167,000 to 189,000|    175,000 to 195,000|
|(ounces)            |                      |                      |
|____________________|______________________|______________________|
|Silver Production   |4,840,000 to 5,555,000|4,950,000 to 5,500,000|
|(ounces)            |                      |                      |
|____________________|______________________|______________________|
|Gold Eq. Production |    255,000 to 290,000|    265,000 to 295,000|
|(ounces)(1)         |                      |                      |
|____________________|______________________|______________________|
|Total Cash Costs per|             $455-$485|             $445-$475|
|Gold Eq. Ounce(1,2) |                      |                      |
|____________________|______________________|______________________|

1.     Assumes a gold equivalency ratio of 55:1


2.     Assumes a foreign exchange rate of 12.0 Mexican pesos to 1 U.S.
dollar


3.     Attributable production

The Company anticipates that a further update may be provided in
September when the preliminary impact of the expansion programs
launched at El Chanate and El Cubo begin to be realized.

'Throughout the first half of the year Ocampo continued to deliver
strong production results at cash costs below the industry average and
this robust performance has been further augmented by our growing and
diversified production profile. Production from the El Chanate mine
contributed to our operating results for the first time in Q2 and with
the commencement of commercial production at El Cubo in mid-July, we
look forward to record results in the coming quarters,' stated Rene
Marion, President and Chief Executive Officer. 'Ongoing productivity
initiatives will be further enhanced in the coming quarters as we gain
traction from our multi-phased expansion program at El Chanate, the
introduction of long-hole mining methods at El Cubo and further
productivity improvements at Ocampo. Over the past eighteen months, the
Company has undergone a considerable transformation and is now one of
the fastest growing mid-tier precious metal producers, with a solid
track record of delivering results.'

El Chanate Expansion Program Overview

The Company has already made significant progress through implementing
the first phase of a potential 5-phase strategic expansion program that
was launched immediately upon acquiring the El Chanate operation on
April 8(th). The 5-phase program targets up to an 86% increase in the crushing and
stacking rate from the 2010 average of 14,000 tonnes per day to 26,000
tonnes per day. Initially, the Company will implement Phases 1 and 2
that target a cumulative 50% increase in the crushing and stacking
rates to 21,000 tonnes per day by mid-2012. At current spot metal
prices the Phase 1 and 2 expansions are anticipated to yield an
internal rate of return of over 1,300%. The decision to proceed with
any, or all, of the remaining phases will be made following the
completion of the 2011 year-end El Chanate reserve update that will
incorporate the 213 holes drilled to June 30th that are not included in
the previous reserve and the planned 20,000 metres expected to be
drilled in the second half of 2011. With a new reserve anticipated to
be issued in late Q1 2012, together with an updated mine design, a
decision will be made on how many of the remaining Phases will be
completed to reach optimal capacity.

Phase 1 (Target: 18,000 tonnes per day)


As of the end of Q2, Phase 1 of the expansion program had already
delivered a 79% increase (116% month to date in July) in material moved
and a 30% increase in the crushing and stacking rate to approximately
18,000 tonnes per day. This improvement in tonnage was attained through
an increase in the crush size to 0.38 inches, from 0.16 inches, as
internal reviews indicate that leach recovery is not sensitive to crush
size in that range, but rather to solution levels. Other initiatives
include an initial upgrade to the conveyor and stacking systems, an
additional stacker, an additional track dozer and the conversion to a
cascaded leach operation. Phase 1 is expected to be completed by the
end of the third quarter.

    --  Capital estimate: $1.8-2.3 million
    --  Payback: 3 months

Phase 2 (Target: 21,000 tonnes per day)


Phase 2 targets a cumulative 50% increase in the crushing and stacking
rate to 21,000 tonnes per day  that will be achieved through a further
expansion of the conveyor system, the deployment of additional mobile
equipment, two new grasshoppers, upgrades to the carbon recovery plant
and a further optimization of the agglomeration system. The eight month
program is anticipated to be launched in early Q4 and completed in
mid-2012.

    --  Capital estimate: $1.6-2.1 million
    --  Payback: 2 months

Phase 3 (Target: 23,000 tonnes per day)


The third phase of the expansion program would include further
operational enhancements including an upgrade to the primary crushing
system, installation of a dust collection system and further expansion
of the conveyor and stacking systems. If implemented, the anticipated
completion date of the third phase would be in the second half of 2012.

    --  Capital estimate: $1.8-2.3 million
    --  Payback: 4 months

Phase 4 (Target: 26,000 tonnes per day)


The fourth phase of the expansion program would include construction of
a second stacker line, installation of a new stacker and new
grasshoppers to realize further enhancements to the conveyor and
stacking systems. If implemented, the anticipated completion date of
the fourth phase would be Q3 2012.

    --  Capital estimate: $2.0-2.5 million
    --  Payback: 3 months

Phase 5 (Process Optimization)


The final phase of the expansion program would focus on process
optimization and improving agglomeration including the installation of
a third agglomeration drum and a new foundry induction furnace. If
implemented, the anticipated completion date of the fifth phase would
be Q3 2012.

    --  Capital estimate: $1.4-1.9 million

Exploration Update


The 2011 exploration program launched in April at the El Chanate mine
continues to deliver encouraging results. A second exploration drill is
expected to be mobilized on site by the end of July with 20,000 metres
of drilling in 90 holes planned during the second half of the year with
one reverse circulation ('RC') and one diamond drill, at a projected
cost of $2.4 million. The objective of the program is to increase
in-pit reserves, add new reserves outside of the existing ultimate pit
limit and identify new targets for follow-on drilling.

El Cubo Operational Ramp-up

Commercial production resumed at the El Cubo mine on July 11(th) led by a new mine management team under a new modern collective
agreement. The new team has launched a strategic operational
enhancement program and we expect to realize ongoing productivity
enhancements to be reported from El Cubo going forward.

When commercial production resumed at the Los Torres mill there were
more than 75,000 tonnes stockpiled ahead of the mill for processing.
Since restarting, the mill has been processing at a rate in excess of
1,650 tonnes per day. Mining rates have increased to average 1,100
tonnes per day and continue to ramp up to the targeted rate of 1,800
tonnes per day more quickly than the planned timeline of mid-2012.

Underground Operations and Conversion to Long-hole Mining


With the goal of replicating the success of the conversion to long-hole
mining achieved at the Ocampo underground, long-hole stope drilling
commenced in June and drilling rates will be further increased in
late-July with the delivery of the first of two new production drill
rigs. Long-hole stoping conversion is expected to lead to greater
productivity, lower dilution and decreased unit costs. During the
period Q4 2008 to Q4 2010, underground tonnes per day at Ocampo
increased by over 125%, with a corresponding 25% decrease in unit
mining costs while mining dilution decreased significantly. These
improvements are primarily due to the changeover to long-hole stoping.
It is anticipated that with the introduction of long-hole stoping at El
Cubo, manpower productivity should increase to a level such that
cut-and-fill crews could be redeployed towards exploration drifting on
targets identified from surface drilling. A planned capital investment
of $1.5 million has been allocated to purchase two Stopemate long hole
drills, three scoop trams and the conversion of an additional three
scoop trams to remote mucking. It is anticipated that 30% of ore mining
will be long-hole by the end of year and that productivity in the
initial areas selected for long-hole mining will be higher than if they
were to be mined using the cut-and-fill method.

Dolores - Capulin Target


Dedicated jumbo development toward the Dolores-Capulin resource
discovery commenced May 1(st) and has advanced 110 metres to date. It is expected that development
will have advanced sufficiently by Q2 2012 to allow stoping activities
to begin. Concurrently, additional surface drilling is planned to
further delineate the extent of the ore zone. The current resource at
Dolores-Capulin stands at 47,755 Measured and Indicated gold equivalent
ounces, using a gold equivalency rate of 55:1.

Exploration Update


The surface exploration program at El Cubo is being re-started with one
diamond drill rig being mobilized by the end of July. The planned
12,000 metre, 36 hole, $1.8 million program will initially focus on the
Dolores-Capulin and Puertecito discoveries made in early 2010.

The contents of this press release have been reviewed and approved by
Chris Bostwick, Senior Vice President - Technical Services, who is a
'Qualified Person' for the purposes of NI 43-101.

About AuRico Gold


AuRico Gold is a leading intermediate Canadian gold and silver producer
with a diversified portfolio of high quality mines and projects in
Mexico. The Company's three wholly-owned operating properties include
the Ocampo mine in Chihuahua State, the El Chanate mine in Sonora State
and the El Cubo mine in Guanajuato State. AuRico's strong pipeline of
development and exploration stage projects include the Guadalupe y
Calvo advanced development property in Chihuahua State and the Orion
advanced development property in Nayarit State, along with six
exploration properties throughout Mexico. AuRico's head office is
located in Toronto, Ontario, Canada.

Cautionary Statement

Cautionary Note to US Investors - The United States Securities and
Exchange Commission permits US mining companies, in their filings with
the SEC, to disclose only those mineral deposits that a company can
economically and legally extract or produce. This press release uses
certain terms, such as 'measured', 'indicated' and 'inferred'
'resources,‛ that the SEC guidelines strictly prohibit US registered
companies from including in their filings with the SEC. US Investors
are urged to consider closely the disclosure in AuRico Gold's Annual
Report on Form 40-F, which may be secured from AuRico Gold, or from the
SEC's website at http://www.sec.gov/edgar.shtml.

No stock exchange, securities commission or other regulatory authority
has approved or disapproved the information contained herein.

Certain statements included herein, including information as to the
future financial or operating performance of the Company, its
subsidiaries and its projects, constitute forward-looking statements.
The words ''believe'', ''expect'', ''anticipate'', ''target'',
''continue'', ''estimate'', ''may'', and similar expressions identify
forward-looking statements. Forward-looking statements include, among
other things, statements regarding the grades of additional underground
and surface drilling programs at El Chanate, the ability to delineate
additional measured and indicated resources or reserves as a result,
the suitability of targets for future open pit mining at El Chanate,
anticipated future financial and operational performance, the future
price of gold and silver, the timing of re-commissioning and
re-commencement of production at El Cubo, the de-risking of operations,
future exploration results of its exploration and development program
at El Chanate and the success of the Company's exploration approach,
the Company's ability to delineate additional resources and reserves as
a result of such program, and the company's ability to mine such
targets by mid-2011, statements regarding its financial exposure to
litigation, targets, estimates and assumptions in respect of gold and
silver production and prices, operating costs, results and capital
expenditures, mineral reserves and mineral resources and anticipated
grades, recovery rates, future financial or operating performance,
margins, operating and exploration expenditures, costs and timing of
completion of the Ocampo expansion program and improvements to the heap
leach pad, costs and timing of the development and commencement of
production of new deposits, costs and timing of construction, costs and
timing of future exploration and reclamation expenses including,
anticipated 2011 and 2012 results, operating performance projections
for 2011 and 2012, our ability to fully fund our business model
internally, 2011 and 2012 gold and silver production and the cash and
operating costs associated therewith, the ability to achieve
productivity and operational efficiencies, and the timing of each
thereof. Forward-looking statements are necessarily based upon a number
of estimates and assumptions that, while considered reasonable by the
Company, are inherently subject to significant business, economic,
competitive, political and social uncertainties and contingencies. Many
factors could cause the Company's actual results to differ materially
from those expressed or implied in any forward-looking statements made
by, or on behalf of, the Company. Such factors include, among others,
known and unknown uncertainties and risks relating to additional
funding requirements, reserve and resource estimates, commodity prices,
hedging activities, exploration, development and operating risks,
illegal miners, political and foreign risk, uninsurable risks,
competition, limited mining operations, production risks, environmental
regulation and liability, government regulation, currency fluctuations,
recent losses and write-downs, restrictions in the Company's loan
facility, dependence on key employees, possible variations of ore grade
or recovery rates, failure of plant, equipment or process to operate as
anticipated, accidents and labour disputes. Investors are cautioned
that forward-looking statements are not guarantees of future
performance and, accordingly, investors are cautioned not to put undue
reliance on forward-looking statements due to the inherent uncertainty
therein.

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