ALLIED GOLD (AGLD) – Debt Reduction Accelerated

ALLIED GOLD (AGLD) – Debt Reduction Accelerated

Allied Gold has today announced a further USD$3.3M reduction in its corporate debt position. The reduction is a direct result of the Company proactively managing its hedge book in light of its ongoing financial risk management as outlined in previous quarterly reports.

Total debt repaid over the period from June 2008 - October 2008 is now USD$10.6M with the residual debt position remaining at USD$3.4M.  As a result of the completed transaction, the next scheduled debt repayment is not due until June 2009.

Mirabaud Securities say: Allied Gold has effectively paid its 31 Dec 08 and 31 March 09 quarterly debt repayments early.  The company has this morning announced an accelerated payment of US$3.3m.  The company paid US$4.1m on 30 Sep 2008 and was due to pay five further instalments at the end of the next five quarters.  This early repayment leaves just US$3.4m to be repaid – the next repayment will not now be required until 30 June 2009.  This gives Allied a great deal more financial flexibility with no need to have debt service reserves and additional cash on call at the end of the next two quarters.

The company’s hedge exposure has also been reduced slightly - removing the FY2012  bought put options.  The sold call position remains unchanged.  The hedge book covers approximately 80% of our forecast production in FY09 (end-June), 66% in FY10, 64% in FY11 and 12% in FY12.  Of the hedged production, 60% is guaranteed at US$700/oz or better and the remaining 40% is exposed to spot prices.

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