Luna Gold Corp. (fka LGCUF)

[b4atf]

LUNA GOLD ANNOUNCES COMMERCIAL PRODUCTION AT AURIZONA

Feb 9, 2011 08:30:00 (ET)

VANCOUVER, Feb 09, 2011 /PRNewswire via COMTEX/ -- Luna Gold Corp. (TSXV-LGC) ("Luna Gold" or the "Company") is pleased to announce the commencement of commercial production at the Company's Aurizona Gold Mine ("Aurizona"), located in Maranhão State, Brazil.

Aurizona Gold Mine Status Highlights:

Gold Production for November and December 2010 and January 2011, totals 10,905 ounces

Combined 90-day average throughput rate in excess of 3,615 tonnes per day, including peak daily throughputs as high as 5,000 tonnes

Additional plant modifications to be completed in February and March 2011 will increase productive capacity and provide more consistency in production

Full production ramp-up to consistently produce 4,500 tonne-per-day capacity is on schedule from April 2011

On track to meet 2011 gold production guidance of 55,000 to 60,000 ounces

"Over the course of its construction and production ramp-up, Aurizona has overcome significant challenges and achieved an operational milestone today with the commencement of commercial production," said John Blake, President and CEO, of Luna Gold Corp.

"Our operational and exploration teams have demonstrated their skills and expertise to achieve this production milestone. We will apply these skills to our next suite of growth projects, which include the expansion of the Aurizona production capacity, increasing the Aurizona resource base, advancing the Cachoeira development project and fast tracking new discoveries in our highly prospective 170,000 ha land holding in Maranhão State."

Gold is now being routinely produced and sold to customers around the world. As this successful ramp-up continues, the Company will focus on cost reduction and the acceleration of cash flows. Guidance on production and cash operating costs will be provided in the next quarterly report.

Aurizona's feasibility study has a designed processing capacity in year one of 55,000 ounces of Gold, ramping up to 60,000 ounces of gold per year for an 11 year mine life.

The Company continues to advance a number of initiatives to further enhance the economics at Aurizona with the aim to increase production capacity. To provide for this additional capacity, the Company is undertaking major drill programs at Aurizona with the aim of increasing the resource base. There is potential for significant supplemental gold production from satellite deposits identified in the near mine area. The Company also holds an additional 170,000 ha of exploration licenses in the state of Maranhão, where exploration teams have identified several priority targets which are being advanced to drill stage. Additionally, the Company is planning to commence a scoping study based on the recently announced NI 43-101 maiden resource estimate at Cachoeira, in Para state, Brazil.