Centerra Gold Updates Reserves and Resources Total Gold Reserves 8.1 million Contained Ounces

Centerra Gold Inc. (TSX:CG) today issued updated estimates for the Company’s reserves and resources based on its successful 2011 exploration program.

• Replaced reserves mined in Kumtor Central Pit.
• Measured and Indicated resource base increased 36% or 1.8 million contained ounces of gold to 6.7 million contained ounces of gold.
• Added 393,000 ounces of contained gold to the high-grade inferred SB Underground resource.
• Initial Measured and Indicated resource of 824,000 ounces of contained gold at the ATO project in Mongolia.
• New gold resource of 289,000 contained ounces Indicated and 211,000 contained ounces Inferred on the Kara Beldyr project in Russia.
• Opportunity for resources at Ortaçam North in Turkey.

During 2011, Centerra’s Proven and Probable gold reserves increased 694,000 contained ounces (before accounting for 2011 production) to 8.1 million ounces of contained gold, compared to 8.2 million ounces as of December 31, 2010. This represents an increase of 9% before accounting for 793,000 contained ounces processed at Kumtor and Boroo during 2011. All 2011 year-end reserves were estimated using a gold price of $1,200 per ounce compared to $1,000 per ounce at December 31, 2010.

At the Kumtor mine, in the Kyrgyz Republic, an estimated 704,000 ounces of contained gold have been added to reserves, representing an increase of 11%, before accounting for 2011 production. After accounting for processing of approximately 709,000 ounces of contained gold in 2011, Kumtor’s proven and probable mineral reserves remain at 6.3 million ounces of contained gold as of December 31, 2011.

In Mongolia, at the Boroo mine, after accounting for processing of approximately 84,000 ounces of contained gold in 2011, proven and probable reserves total 298,000 ounces of contained gold. At the reserve gold price assumption, the Boroo operation could potentially continue to feed the mill for over two years utilizing existing low-grade stockpiles. At the Gatsuurt project, proven and probable reserves remain unchanged at 1.5 million ounces of contained gold.

Steve Lang, President and CEO of Centerra Gold said: “2011 was another successful exploration year for Centerra. We replaced reserves mined at Kumtor, generated initial resources at ATO and Kara Beldyr, and brought more than 2.4 million new ounces of gold into reserves plus resources and an additional 600,000 ounces of gold into inferred resources at an average cost of less than $15 per ounce. We entered our first joint venture in China, added a second joint venture in Russia and our strong drill results at Ortaçam North in Turkey should produce an initial resource statement by the end of 2012.”

Year-end Reserves and Resources

Reserves

As of December 31, 2011, Centerra’s proven and probable reserves increased 694,000 contained ounces (before accounting for 2011 production) to 8.1 million ounces of contained gold, compared to 8.2 million ounces as of December 31, 2010. This represents an increase of 9% before accounting for 793,000 contained ounces processed at Kumtor and Boroo during 2011. All 2011 year-end reserves were estimated using a gold price of $1,200 per ounce compared to $1,000 per ounce at December 31, 2010.

At Kumtor, before accounting for the processing of 709,000 contained ounces during 2011, proven and probable reserves increased by 704,000 contained ounces of gold replacing reserves mined during the year. All of the increase in the Central Pit open pit reserves is a result of additional exploration drilling primarily on the Southwest Extension of the SB Zone. This drilling has continued to outline a new zone of mineralization that lies immediately to the northwest of the Southwest Extension of the SB Zone. The drilling has also increased the average reserve grade for the Central Pit to 3.7 g/t Au, compared to 3.4 g/t Au in 2010. There has been no change in cut-off grades used for reserve estimation.

At Boroo, after accounting for the processing of 84,000 contained ounces during 2011, proven and probable reserves total 298,000 contained ounces of gold. At the reserve gold price assumption, the Boroo operation could potentially continue to feed the mill for over two years utilizing existing low-grade stockpiles.

At Gatsuurt, proven and probable reserves remain unchanged at 1.5 million contained ounces of gold.

Resources

As of December 31, 2011, Centerra’s measured and indicated resources increased by 36% or 1.8 million ounces over the December 31, 2010 figures to total 6.7 million ounces of contained gold, compared to 4.9 million contained ounces as of December 31, 2010. The increase from the 2010 year-end measured and indicated resources is attributable to an increase in resources at Kumtor together with the addition of new resources for both the ATO project in Mongolia and the Kara Beldyr joint venture project in Russia.

The Company’s inferred resources also increased by 570,000 contained ounces of gold year-over-year. At Kumtor, the inferred resources in the high-grade underground SB Zone increased by 393,000 contained ounces to 1.8 million contained ounces of gold with an average grade of 13.6 g/t. This increase is primarily a result of exploration drilling that has extended the strike length of the high-grade underground resources along strike to the northeast and southwest. The cut-off grade was lowered to 6 g/t Au, from the 7 g/t Au used in previous estimates, which reflects updated cost estimates for mining, however, this has only a minimal impact of the resource estimation. Inferred open pit resources decreased by 65,000 contained ounces of gold in the Central Pit. In addition, exploration drilling in 2011 at the Northeast Prospect resulted in the addition of 150,000 contained ounces of gold to the inferred open pit resources to 278,000 ounces of contained gold with an improvement of grade to 2.1 g/t Au.

The initial resource estimate for the ATO project in Mongolia has a measured and indicated resource of 824,000 ounces of contained gold together with significant silver, lead and zinc and an inferred resource of 26,000 ounces of contained gold together with silver, lead and zinc.

The resource estimate on a 100% basis for the Gord Zone on the Kara Beldyr property in Russia has an indicated resource of 289,000 ounces of contained gold and an inferred resource of 211,000 ounces of contained gold. At the time of the news release Centerra holds a 70% equity interest in the property.

Read the full news release