Kimberley Metals Limited (ASX:KBL) Commenced Mineral Hill Mine Production

Sydney, Australia (ABN Newswire) - Kimberley Metals Limited (ASX:KBL) ('Kimberley', 'the Company') is pleased to report that both Mills are fully operational at Mineral Hill Mine, located 65 kilometres north of Condobolin in central-western News South Wales.

Mineral Hill Plant

Mill No.1 completed commissioning on 20 July 2011 and Mill No.2 completed commissioning on 20 August 2011. Mill No.1 has a capacity of 10 tonnes per hour, whilst Mill No.2 has a capacity of 20 tonnes per hour.

Currently the plant is operating at 20 tonnes per hour utilising the current 4 metre thickener. The installation of an 8 metre thickener into the circuit over the next fortnight will enable production to increase to a combined mill feed rate of 30 tonnes per hour or 262,800 tonnes per annum. Kimberley expects that the mills will operate sustainably at an annual rate of 250,000 tonnes per annum.

Following the commissioning of Mill No.1, an additional bank of floatation cells was brought into production to meet the increased mill feed from 10 tonnes per hour to 30 tonnes per hour.

Copper concentrates are now being bagged ready for transportation to Port Botany by road and rail. The first shipment of approximately 1,000 tonnes is now expected to be despatched in September 2011. Copper concentrate shipments for the next six months will be sent to Yunnan Copper, China's third largest copper smelter, as part of an agreement announced on 28 July 2011.

Parkers Hill Underground Mine

Ore development at Parkers Hill underground mine has now been established in five drives from mining on the refurbished 1205 level and the new 1225 level.

Ongoing rehabilitation on a third (1190) level will allow further high grade ore development options. The mine plan is aimed at establishing flexibility and consistent high grades of ore supply from multiple sources in the mine. Two production jumbos are now in operation, up from one in July, delivering 600-1,000 tonnes per day of ore feed to the plant.

The first high grade production stope remains on schedule for September to add approximately 700 tonnes per day to the ore feed to the plant, bringing monthly ore mined to between 26,000 tonnes to 34,000 tonnes at approximately 2.1% copper.

For the complete Kimberley Metals Limited announcement including figures, please view:
http://media.abnnewswire.net/media/en/docs/ASX-KBL-554166.pdf

About Kimberley Metals Limited:

Kimberley Metals Limited (ASX:KBL) became an independent entity in May 2008 when the shareholders of CBH Resources Limited agreed to the distribution of its 100% shareholding in Kimberley to CBH shareholders and was listed on ASX in February 2010. Kimberley’s aim is to quickly become an established precious and base metal producer and has assembled a balanced portfolio of assets to achieve this goal.

The Mineral Hill Mine is located in the northern part of the Lachlan Fold Belt in central-western New South Wales. Base metal mineralisation was discovered in the Mineral Hill area in 1908, with limited mining and prospecting occurring until the 1950s. Modern mining operations at Mineral Hill Mine were commenced in 1989 by Triako which operated a 200,000 tpa concentrator/CIL plant producing gold in copper concentrate and gold bullion. Mining ceased in late 2005 after producing in excess of 360,000 ounces of gold from at least five different ore zones. Kimberley has a substantial, wholly-owned, tenement holding at Mineral Hill, totalling 49 km2.

Since establishment, Kimberley has focused its efforts on identifying sufficient resources to support a re-start of operations at Mineral Hill. Exploration work to date has resulted in the discovery of high grade gold mineralisation at Pearse plus the evaluation and upgrade of the Parkers Hill Cu-Pb-Zn-Ag resource. Many additional near mine exploration targets with the potential to provide ore feed to the Mineral Hill process plant have been identified.

The Company (75%) and Henan Yuguang Gold & Lead Co. Ltd (HYG&L) (25%) own the Sorby Hills silver-lead-zinc deposit in the Kimberley region of Western Australia, which is one of the world’s largest near surface undeveloped lead deposits, close to port infrastructure and a short distance from Asian markets. Sorby Hills was discovered in 1971 and consists of 13 separate but adjacent carbonate hosted, near surface lead-silver-zinc deposits.

Source:

Kimberley Metals Limited

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