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Angel Mining PLC: Operational Update

Contributed by Fox-Davies Capital

Angel Mining has announced that a mechanical breakdown on Polaroil's fuel oil delivery tanker led to the late delivery of fuel oil at Nalunaq and as a result production was stopped on 26 September for 5 days. The fuel oil was subsequently delivered on 1 October and production recommenced immediately. The processing circuit has since been re-charged with new ore and carbon stripping recommenced on 14 October. As a consequence of the delayed fuel oil delivery the plant will only achieve a single gold pour in October and this will be for a lower quantity of gold than had previously been anticipated for the monthly production total.

The key issue here is that the shortfall in gold production has placed further pressure on the Company's limited financial resources and, as a result, the Company today announces that it has extended its loan arrangements with Cyrus Capital Partners LP ("Cyrus") by an additional US$2.OM. In addition to Cyrus making available this further short term loan, they have agreed to the extension of the repayment date of the existing outstanding loans made available by Cyrus pursuant to the facilities agreement entered into on 6 June 2007 (as amended and varied from time to time) from 31 December 2012 to 15 February 2013 . The aggregate amount now repayable by the Company to Cyrus on 15 February 2013 is US$30.4M plus accrued interest (such amount, the "Cyrus Outstandings").

The Company will be seeking a more long-term solution to its financing arrangements during the next few months, including raising further equity. The Company recognises the challenges that raising equity are present whilst the current debt structure is in place and as such we are pleased to report that Cyrus have confirmed their intention to participate in a discussion about the Company's capital structure before the end of November. Further announcements will be made in respect of any agreed restructuring in due course.

In order to facilitate this process and to avoid any conflict of interests, Daniel Bordessa has resigned as a Director of the Company with immediate effect. The structure and composition of the Board is under review and the Company expects to announce further details in this respect before 31 December 2012. This will coincide with a broader strategic review the Company intends to undertake within the same period.