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Allied Nevada Gold Corp

Allied Nevada Gold cash costs come in well ahead of expectations

Allied Nevada Gold ("Allied Nevada”) (TSX, NYSE Amex: ANV) delivered a pleasant surprise to shareholders this morning, confirming that its 2009 cash costs had come in well below previous guidance, thanks to a combination of higher grades, the addition of silver credits and lower than expected input prices.

Cost of sales per ounce of gold sold is now expected to be around US$385, compared to previous guidance of $460 to $480.  During the 12 month period ended 31 December 2009, Allied Nevada Gold mined 24.5 million tonnes of material and placed approximately 214,000 ounces of gold and 2.16 million ounces of silver on its leach pad, which also ahead of expectations thanks to higher than budgeted grades.

It was not all positive news from the junior gold producer however; in 2009 the company sold 42,358 ounces of gold, of which 14,395 ounces were sold in the fourth quarter – this was below expectations, though Allied Nevada said it had no resolved a number of challenges related to its leach pad performance.  Post year end, the company produced 8,200 ounces of gold and 17,000 ounces of silver in January, suggesting the mine was now on the path to targeted production rates.

“Current production from the new areas of pad under leach is performing as expected with recoveries and gold release within planned levels,” the company stated. “Management believes past commissioning challenges have been resolved and we are on track to meet our 2010 gold sales guidance of 100,000 ounces.”

The Hycroft Mine currently hosts a measured and indicated resource of 5.9 million ounces of gold and 117.5 million ounces of silver. An updated reserve statement is expected in the second quarter of 2010.

"With the planned crusher expansion, analysis of an optimal mining rate for oxide material, the anticipated resource update in Q2 and ongoing drilling, we believe 2010 will be an exciting and productive year," comments Scott Caldwell, President & CEO. "While we did run into some operational challenges in our start-up year, our performance in December 2009 and January 2010 indicates that these issues have been resolved. The mine is operating at planned production rates and we are on track to meet targeted production levels for 2010. Looking forward, we are shifting our focus to near and long-term expansion opportunities such as an accelerated oxide mining rate, sulphide resource development and follow-up drilling on the newly discovered silver high-grade zones."