Allied Gold Mining PLC: Simberi Update

QUEENSLAND, AUSTRALIA -- (Marketwire) -- 10/25/11 --

THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR
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25 October 2011



SIMBERI GOLD MINE - PAPUA NEW GUINEA

Production restarts at Simberi as Mine pours 250,000TH ounce

Ball Mill Repair Complete, 3 weeks of lost production

Fuel initiatives to Reduce costs by $50/oz expected by mid 2012

Expansion to 100,000 ozpa rate expected from qtr 3 2012



Allied Gold Mining plc's Simberi Gold Mine in Papua New Guinea this
week celebrated the pouring of its 250,000th ounce of gold since
commercial production first commenced in 2008.

The mine which began with a modest eight year outlook is now putting in
place expansion and efficiency initiatives for mid-2012 that should see
it produce a minimum 100,000 ozpa over the next ten years from its
oxide open pit operations. A sulphide processing circuit could further
lift Simberi's annual production rate to more than 250,000 ozpa from
2015.

Processing at Simberi, 45 kilometres from Lihir Island in the New
Ireland province of PNG, has recommenced following a shutdown due to
repairs to the 2.4 mtpa ball mill.

Due to the three week mill shutdown, Simberi is expected to produce in
the December quarter between 12,000 and 14,000 ounces, compared to a
steady state run rate of 18,000 ounces a quarter.

Full year production from Simberi in 2011 is expected to be
approximately 58,000 ounces with expansion and fuel cost saving
initiatives aimed at lifting production to approximately 100,000 ozpa
and reducing costs to a targeted US$850-US$900/oz to take effect during
2012.

Recently ordered heavy fuel oil generator sets will be delivered and
progressively installed during the June quarter of 2012. When fully
operational, the switch from diesel generators to heavy fuel oil will
reduce Simberi's operating cost by approximately US$50/oz.

The expansion of the Simberi processing plant from 2.4 Mtpa to 3.5 Mtpa
is scheduled for between June and September 2012. A number of key long
lead equipment items, such as the SAG mill, are already at site and
awaiting fabrication or installation in 2012. The key long lead items
awaiting delivery in the June quarter 2012 include the tailings
thickener and the ore reclaimer.

Allied Gold Managing Director and CEO Mr Frank Terranova comments:
'From Simberi's modest beginnings it is apparent the oxide and sulphide
resources provide opportunity for production well into next decade.
The focus of much of 2011 has been to prepare for the expansion in 2012.
 There have been some challenges at Simberi during 2011 and
production for calendar year 2011 is now expected to be approximately
58,000 ounces compared to the 70,000 ounces originally forecast. The
lower production has seen our average cash costs increase. This means
the cash costs for the year will be in the order of US$1000 per ounce
compared to the US$850/oz it would otherwise have been. We
anticipate that the production rate of 70,000 ozpa will be reflected in
the March quarter and then a lift in production during 2012 towards
100,000 ozpa. Higher throughput will reduce costs and the investments
we are making with heavy fuel oil generators should also push costs
down further.'

Drilling continues at Simberi on the oxide and sulphide potential of
various pits. The bankable feasibility study for a 150,000 ozpa
sulphide circuit to lift Simberi production towards 250,000 ozpa by mid
decade is scheduled for release in mid-2012.The Group continues
exploration operations to further build on the resource base in Papua
New Guinea and the Solomon Islands.

Allied Gold Mining plc will release its September quarterly activities
report and Management Discussion & Analysis at the end of this month.

ABOUT ALLIED GOLD MINING PLC

Allied Gold is a Pacific Rim gold producer, developer and exploration
company. It is a FTSE250 constituent and listed on the London Stock
Exchange's Main Market (ALD), Toronto Stock Exchange (ALD) and the
Australian Securities Exchange (ALD). It owns 100% of the Simberi gold
project, located on Simberi Island, the northern most island of the
Tabar Islands Group, in the New Ireland Province of eastern PNG, and
has a 100% interest Gold Ridge gold project, located on Guadalcanal
Island in the Solomon Islands. Allied Gold has resources of 8.6Moz
inclusive of 3.4Moz of reserves and an extensive exploration programme
is underway. The Company is rapidly ramping up production and
targeting a run rate of 200,000ozpa during 2012.

For further information:



Allied Gold Mining PLC  RBC Capital Markets (Joint Corporate Broker)
(Investor and Media)    Stephen Foss / Matthew Coakes / Daniel Conti
Simon Jemison            44 (0) 207 653 4000
 61 418 853 922

Buchanan (Financial PR  Oriel Securities (Joint Corporate Broker)
Advisor)                Jonathan Walker / Michael Shaw
Bobby Morse /            44 (0) 207 710 7600
James Strong
 44 (0) 207 466 5000



Forward-Looking Statements

This press release contains forward-looking statements concerning the
projects owned by Allied Gold. Statements concerning mineral reserves
and resources may also be deemed to be forward-looking statements in
that they involve estimates, based on certain assumptions, of the
mineralisation that will be found if and when a deposit is developed
and mined. Forward-looking statements are not statements of historical
fact, and actual events or results may differ materially from those
described in the forward-looking statements, as the result of a variety
of risks, uncertainties and other factors, involved in the mining
industry generally and the particular properties in which Allied has an
interest, such as fluctuation in gold prices; uncertainties involved in
interpreting drilling results and other tests; the uncertainty of
financial projections and cost estimates; the possibility of cost
overruns, accidents, strikes, delays and other problems in development
projects, the uncertain availability of financing and uncertainties as
to terms of any financings completed; uncertainties relating to
environmental risks and government approvals, and possible political
instability or changes in government policy in jurisdictions in which
properties are located. Forward-looking statements are based on
management's beliefs, opinions and estimates as of the date they are
made, and no obligation is assumed to update forward-looking statements
if these beliefs, opinions or estimates should change or to reflect
other future developments.



Not an offer of securities or solicitation of a proxy

This communication is not a solicitation of a proxy from any security
holder of Allied Gold, nor is this communication an offer to purchase
or a solicitation to sell securities. Any offer will be made only
through an information circular or proxy statement or similar
document. Investors and security holders are strongly advised to read
such document regarding the proposed business combination referred to
in this communication, if and when such document is filed and becomes
available, because it will contain important information. Any such
document would be filed by Allied Gold with the Australian Securities
and Investments Commission, the Australian Stock Exchange and with the
U.S. Securities and Exchange Commission (SEC).

Competent Person

The information in this announcement that relates to Mineral Resources,
Project Financial modelling, Mining, Exploration and Metallurgical
results, together with any related assessments and interpretations, has
been approved for release by Mr C R Hastings, MSc, BSc, M.Aus.I.M.M., a
qualified geologist and full-time employee of the Company. Mr Hastings
has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the
activity which he is undertaking to qualify as a Competent Person as
defined in the 2004 Edition of the 'Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves'. Mr Hastings
consents to the inclusion of the information contained in this ASX
release in the form and context in which it appears.



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