Golden Star Reports Financial Results for the Fourth Quarter and 2006 Year

    DENVER, March 14 /CNW/ - Golden Star Resources Ltd. (AMEX:  GSS)(TSX:GSC)
today announced its audited results for the full year and fourth quarter 2006.
(All currency is expressed in U.S. dollars, unless otherwise noted).

    2006 RESULTS

    --  Net income of $64.7 million, or $0.31 per share

    --  Increase in revenues of 35% to $128.7 million

    --  Record gold sales of 201,406 ounces from the Bogoso/Prestea and Wassa
mines in Ghana

    --  Average realized gold price of $607 per ounce

    --  Average cash operating cost(1) of $442 per ounce

    --  Sales of certain non-core assets for a total pre-tax capital gain of
$81.1 million

    --  Cash flow from operations of $27.7 million before committing
approximately $22.3 million to increases in ore stockpiles


    --  Net income of $30.7 million, or $0.15 per share

    --  Revenues of $33.2 million

    --  Gold sales of 53,406 ounces at a cash operating cost(1) of $393 per

    2007 OUTLOOK

    --  Expected 2007 production of 390,000 ounces at average cash operating
costs(1) of $389 per ounce

    --  Hwini-Butre and Benso feasibility study release and decision to mine
expected in May

    --  Prestea underground, West Reef, feasibility study expected by

    (1) See note on non-GAAP financial measures at the end of this press


    We had net income of $64.7 million or $0.31 per share on revenues of
$128.7 million for 2006 versus a net loss of $(13.5) million or $(0.09) per
share on revenues of $95.5 million for 2005. Mine operations contributed $7.6
million to 2006 pre-tax income versus a deficit of $(6.7) million in 2005. The
major factor contributing to the $78.2 million improvement in earnings was the
sale of certain of our non-core assets including all of our shareholdings in
Moto Goldmines Limited ("Moto") and the majority of our shareholdings in EURO
Ressources S.A. ("EURO").

    Improved gold prices were the major driver for the improved operating
margins in 2006. Consolidated gold revenue increased by $32.9 million despite
gold sales in 2006 being only marginally increased relative to gold sales in
2005. Gold prices averaged $607 per ounce in 2006 compared to $446 per ounce
in 2005.

    Looking forward, we forecast total gold sales in 2007 of 390,000 ounces
at an average cash operating cost of $389 an ounce, benefiting from a partial
year contribution from the Bogoso Sulfide Expansion Project.


    Year ended December 31
                                                       2006          2005
    Gold sold (ounces)                              201,406       200,968
    Price realized ($ per ounce)                        607           446
    Cash operating cost ($ per ounce) (1)               442           383
        Royalties ($ per ounce)                          18            13
    Total cash cost ($ per ounce) (1)                   460           396
    Revenues (in thousands $)                       128,690        95,465
    Net (loss)/income (in thousands $)               64,689       (13,531)
    Net (loss)/income per share ($)                   0.312        (0.094)
    Net (loss)/income per fully diluted share ($)     0.308        (0.092)
    Average shares outstanding (in millions)          207.5         143.6
    Average fully diluted shares (in millions)        209.7         146.8
    Shares outstanding end of year (in millions)      207.9         206.0

    (1) See note on non-GAAP financial measures at the end of this press

    Fourth Quarter
                                              For the three months ended
                                                      December 31,
                                                       2006          2005
    Gold sold (ounces)                               53,406        54,196
    Price realized ($ per ounce)                        618           486
    Cash operating cost ($ per ounce) (1)               393           430
         Royalties ($ per ounce)                         17            15
    Total cash cost ($ per ounce) (1)                   410           509
    Revenues (in thousands $)                        33,224        27,743
    Net (loss) income (in thousands $)               30,749          (956)
    Net (loss) income per share ($)                   0.148        (0.006)
    Average shares outstanding (in millions)          207.5         146.7
    (1) See note on non-GAAP financial measures at the end of this press


    Year ended December 31
                                       2006                  2005
                                  Bogoso/   Wassa       Bogoso/   Wassa
                               Prestea(2)            Prestea(2)
    Ore mined (thousands of
     tonnes)(2)                    1,364      2,449      1,646      2,060
    Waste mined (thousands of
     tonnes)(2)                    6,014     11,608     10,741      7,848
    Tonnes milled (thousands)      1,494      3,691      1,558      2,692
    Average grade milled (g/t)      3.56       0.90       4.14       0.91
    Mill recovery (%)               60.4       88.8       60.7       88.7
    Gold sold                    103,792     97,614    131,898     69,070
    Cash operating cost ($ per
     ounce) (1)                      412        474        338        468
    Total cash cost ($ per
     ounce) (1)                      430        493        351        482

    Fourth Quarter
                                 For the three months ended December 31,
                                       2006                  2005
                                  Bogoso/   Wassa     Bogoso/     Wassa
                               Prestea(2)            Prestea(2)
    Ore mined (thousands of
     tonnes) (2)                     240        591        296        679
    Waste mined (thousands of
     tonnes) (2)                     258      2,575      2,477      3,432
    Tonnes milled (thousands)        421        886        391        915
    Average grade milled (g/t)      3.50       1.02       3.21       0.91
    Mill recovery (%)               61.5       88.6       67.4       88.2
    Gold sold                     25,054     28,352     25,053     28,351
    Cash operating cost ($ per
     ounce) (1)                      311        464        396        473
    Total cash cost ($ per
     ounce) (1)                      329        482        410        488
    (1) See note on non-GAAP financial measures at the end of this press
    (2) Excludes pre-stripping of sulfide pits and production from Bogoso
     Sulfide Expansion Project.


    Bogoso/Prestea generated an $8.4 million operating margin for 2006 on
sales of 103,792 ounces of gold, up from a $2.5 million operating margin on
gold sales of 131,898 ounces in 2005. The major factor contributing to 2006's
improved results included a 37% increase in realized gold prices, which was
offset by lower production, as a result of lower ore grades from the
Plant-North pit and lower processing plant through-put due to harder than
anticipated ores from the deeper levels in the Plant-North pit.

    Cash operating costs at Bogoso/Prestea decreased from $46.3 million in
2005 to $44.7 million in 2006 primarily due to reduced stripping rates as the
Plant-North pit neared the end of its life. While the actual spending was
lower in 2006, lower gold production led to an increase in costs per ounce
resulting in a cash operating cost of $412 per ounce compared to $338 per
ounce in 2005.

    Bogoso/Prestea generated a positive operating margin of $4.8 million in
the fourth quarter of 2006 versus an operating margin loss of $(3.9) million
in the fourth quarter of 2005.

    Our financial numbers for 2006 incorporate a review of our ore stockpile
inventory valuation at Bogoso/Prestea for the first three quarters. The impact
on the first three quarters of 2006 is as follows:

                                      First Quarter      Second Quarter
                                   Originally Restated Originally Restated
    Operating margin                    (2.3)    (1.9)       2.0        -
    Cash operating costs                 527      505        413      498
    Operating margin                    (4.4)    (4.0)       2.2      0.2
    Cash operating costs                 505      495        448      498
    Net Income                          19.0     19.3       14.4     13.1
    Earnings per share
    - Basic                            0.092    0.093      0.070    0.063
    - Diluted                          0.091    0.092      0.069    0.063

                                                          Third Quarter
                                                       Originally Restated
    Operating margin                                         7.6      5.5
    Cash operating costs                                     311      390
    Operating margin                                         8.0      5.9
    Cash operating costs                                     373      409
    Net Income                                               3.0      1.5
    Earnings per share
    - Basic                                                0.014    0.007
    - Diluted                                              0.014    0.007


    Wassa operated for twelve months in 2006 versus nine months in 2005 and
therefore operating results are not readily comparable.

    Wassa generated a negative operating margin of $(0.8) million for 2006,
which was improved relative to the higher negative operating margin of $(9.2)
million for the nine months of operation in 2005. Results at Wassa were
improved in the remaining three quarters of 2006 with a positive operating
margin in each of those quarters.

    In the fourth quarter of 2006, Wassa generated an operating margin of
$0.5 versus a negative operating margin of $(3.0) million in the fourth
quarter of 2005.

    Operationally, Wassa is performing well and costs per tonne are at or
around target levels. However, the mined grade has under-performed relative to
the average reserve grade, which has resulted in lower gold production and
higher cash operating costs per ounce. At year-end, Wassa's Mineral Reserves
were re-stated based on a new resource model which better reflects the ore
grades encountered during 2005 and 2006.


    Construction of the Bogoso Sulfide Expansion Project continued throughout
2006 and we commenced commissioning some portions of the project toward the
end of the year. The Project is designed to expand the existing Bogoso
processing capacity by adding a sulfide processing plant with a nominal
capacity of 3.5 million tonnes per year of refractory sulfide ore. The sulfide
processing plant will utilize the BIOX(R) bio-oxidation process. Approximately
82% of the Mineral Reserves at Bogoso/Prestea are refractory sulfide ore,
which cannot be economically processed in the existing oxide plant.

    We are currently in the final stages of construction and commissioning of
the sulfide processing plant. Overall, progress is substantially in line with
our estimates set forth in our press releases of January and February of this
year. Of note:

    --  Crushing and grinding of sulfide ore commenced on February 22;

    --  BIOX(R) Module 1 started flowing to the washing circuit on February

    --  Washed, bacterially oxidized ore started flowing from the washing
circuit to the Carbon in Leach (CIL) circuit on March 4;

    --  The first gold from the new plant is expected to be poured on or
around March 20;

    --  BIOX(R) Module 2 is expected to be filled in late March; and

    --  The new reagents and elution circuit are expected to be commissioned
in March and until then we will continue to utilize the existing reagents and
elution circuit.

    As of December 31, 2006, we had spent approximately $151.7 million on the
Project compared with an original estimate of $150 million and we anticipate
further expenditures of approximately $15 million before commercial production
commences. The higher costs are largely related to the approximate three month
delay in finalizing the Project which has led to higher pre-stripping costs
being incurred, and to some extension of time costs. Costs to December 31,
2006 included $118.8 million for plant construction, $10.5 million for mining
equipment, and $22.4 million for pre-stripping and stockpile and other
inventories. The costs exclude capitalized interest of $6.2 million and
approximately $7.2 million of costs incurred prior to the completion of the
feasibility study and decision to proceed with the development.


    Power supply in Ghana continues to be a significant risk, and therefore,
in addition to our $10 million investment in the joint power project with
Newmont Mining Corporation, Gold Fields Limited and AngloGold Ashanti Limited,
which is expected to be operational by mid-year, we are considering options to
increase our mine-based back-up power.

    The joint power project is expected to satisfy about 50% of our power
requirements, while our existing back-up diesel generating equipment are
capable of satisfying about 30% of our requirements. This leaves 20% or
approximately 10 megawatts that we will need to draw from the national grid
unless, and until, we increase back-up power.


    During 2006, we progressed the feasibility study for Hwini-Butre and
Benso deposits, south of our Wassa mine, and expect to complete this study in
the next month and to present it to our Board of Directors for a mining
decision in May 2007. Subject to this approval and any permitting
requirements, we expect to be mining and hauling high grade ore from
Hwini-Butre and Benso to Wassa for processing, by mid-2008. The high grade ore
is expected to displace low grade ore that would otherwise have been fed to
the Wassa processing plant. The net impact would be a significant increase in
gold production from Wassa and an improvement in mine life and cash operating
costs per ounce.

    At Bogoso/Prestea we progressed the assessment of the Pampe and Prestea
South projects as satellite sources of feed for the Bogoso oxide processing
plant. Mining at Pampe is expected to commence in the first quarter of 2007
and mining at Prestea South is expected to commence in the second half of
2007. The action by the Ghana Government to remove illegal miners from our
mining concessions in Ghana in November was a pivotal step in the assessment
and development of Prestea South.

    Exploration of the Prestea Underground in 2006 focused on the West Reef,
and as a result sufficient drilling was done to provide sufficient confidence
in the mineral resource for a feasibility study to be commenced. We expect
that the feasibility study would be completed by end-2007.


    Exploration expenditures for 2006 totaled $15.3 million, compared to
$17.1 million in 2005.

    Exploration around our mines focused on converting mineral resources to
mineral reserves, and defining further mineral resources, with special
concentration on upgrading mineral reserves at our Hwini-Butre and Benso
properties. Exploration activities included:

    --  Drilling of the Father Brown, Adiokrom, Subriso East, Subriso West,
and the Benso G & I Zones at the Benso property. Studies to determine the best
development options for these deposits are currently in progress;

    --  Drilling beneath the Plant-North pit and Prestea South deposits at
Prestea to determine their near surface and shallow decline access potential;

    --  Drilling of the Prestea West Reef system between the 17 and 24 Levels
to provide a major upgrade in the resources within the area and commencement
of drilling below the 30 Level to determine the continuity and grade of the
down plunge extensions of the historically mined shoots.

    The Mano River joint venture in Sierra Leone continued its exploration
activities with in-fill soil sampling programs leading to commencement of
diamond drilling late in the year. Additionally, exploration was also
conducted on newly acquired properties in Cote d'Ivoire, Burkina Faso and

    Encouraging results at our Saramacca property in Suriname, South America
resulted in a joint venture being signed with a subsidiary of Newmont Mining
Corporation during the year. Target definition work has commenced and drilling
is expected to start in mid to late 2007.


    We broadened and strengthened our management team in 2006 and 2007, of

    --  Tom Mair was employed as Chief Financial officer in February 2007.
Previously he held a number of senior finance roles with Newmont Mining
Corporation over a thirteen year period;

    --  Colin Belshaw was employed as Vice President Operations in June 2006.
Previously he held a number of senior operational and technical roles with
Kinross Gold Corporation;

    --  Daniel Owiredu, a Ghanaian engineer, was employed as Vice President
Ghana in September 2006. Previously Daniel held a number of senior operational
roles with Anglogold Ashanti Limited.

    In addition, we employed Dr. Mark Thorpe as Vice President
Sustainability, Peter Bourke as Vice President Technical Services and Ted
Strickler as Vice President Human Resources and Administration.


    In March 2006, we exercised our remaining warrants to purchase 1.0
million shares of Moto, bringing our total ownership in Moto to six million
common shares. Immediately after such exercise of warrants, we sold all six
million common shares in a bought-deal transaction in Canada for Cdn$7.50 per
share. The sale of the six million shares resulted in net proceeds to Golden
Star of $39.0 million (Cdn$45.0 million). The sale realized approximately
$30.2 million of pre-tax capital gain for Golden Star, which was recognized in
income in the first quarter of 2006. A $4.9 million non-cash tax expense was
recognized on the gain.

    At March 31, 2006 we owned 53% of EURO's outstanding common shares and as
such consolidated EURO's financial results with our own. During the second
quarter of 2006 we sold 362,029 of our EURO shares in open market transactions
realizing approximately $0.7 million of cash. On June 19, 2006 we sold an
additional four million EURO shares in a private transaction receiving $2.5
million of cash. The purchasers of the four million shares have agreed to pay
additional consideration to Golden Star if they sell the shares at a gain.
Since our investment in EURO shares was carried at zero basis, a gain was
recognized on sale of the shares in an amount essentially equal to the cash
proceeds received.

    In the fourth quarter of 2006, we sold an additional 18.0 million of our
EURO common shares in a series of public and private transactions, bringing
our EURO ownership position down to approximately 6% by December 31, 2006. Net
proceeds of the sale totaled approximately $30.0 million. Since our carrying
basis in the EURO shares was nil, the gain on share sale was equal to the
$30.0 million of cash received. Following this sale Golden Star owned
approximately 3.0 million of EURO's common shares as of December 31, 2006,
most of which were sold in open market transactions in the first quarter of
2007. We continue to hold a right to receive from EURO a portion of EURO's
future royalties from IAMGold's Rosebel Mine in Suriname on production
exceeding two million but less than seven million ounces.

    The sale of EURO shares was in line with the goals and objectives
originally envisaged in the 2004 EURO restructuring plan. The goal of the
restructuring plan was to establish EURO as an independent and economically
viable entity that would not be dependent on Golden Star for funding and that
would concurrently bring liquidity to Golden Star's investment.


    Cash flow from operations was $27.7 million during 2006 before committing
approximately $22.3 million to increases in ore stockpiles. This compares to
$1.1 million of cash flow from operations in 2005. The increase is mostly
related to improved gold prices.

    Financing activities provided net cash of $24.1 million during 2006. A
total of $12.4 million of additional equipment financing was drawn during 2006
to cover the cost of new mining equipment. In October 2006, a $15.0 million
medium term bank loan was drawn down by our subsidiary which owns
Bogoso/Prestea. Option exercises contributed an additional $3.5 million in
2006. Debt repayment mostly related to the equipment financing facility
consumed $6.6 million of cash in the year mostly related to the equipment
financing facility.

    Capital assets and capital projects including deferred exploration, new
mining equipment and our major development projects used $170.7 million during
the year of which approximately $127.0 million was spent on the Bogoso Sulfide
Expansion Project. Additionally, approximately $35.1 million was spent on
replacement equipment and mine development at Bogoso/Prestea and Wassa
including mine-site drilling projects and $8.6 million was spent on deferred
exploration projects in West Africa and in South America. Sales of our share
holdings in Moto and EURO yielded $72 million of cash during 2006.

    Our cash and cash equivalent balance stood at $27.1 million at December
31, 2006, down from $89.7 million at the end of 2005. Most of the reduction in
cash balance was related to construction and development spending on the
Bogoso Sulfide Expansion Project not offset by operating cash flow. At
December 31, 2006, working capital was $21.4 million, versus $92.0 million at
the end of 2005.


    Golden Star has made significant progress in 2006; improving the
performance of our existing mines; substantially completing our Bogoso Sulfide
Expansion Project; broadening and strengthening our management team; advancing
the Hwini-Butre and Benso feasibility study; and putting in place sound
programs, in Ghana, to strengthen our relationships with stakeholders.

    Based on our expected gold sales in 2007 and with the benefit of the
stronger balance sheet as a result of our recent successful public offering,
we expect to have sufficient funding to finance our 2007 development programs.

    In 2007, we expect to meet the following targets:

    --  Gold sales of about 390,000 ounces at a cash operating cost of about
$389 per ounce;

    --  Commercial production from the Bogoso sulfide processing plant in the
second quarter with full production achieved by the end of the third quarter

    --  Development of new open pits at Pampe and Prestea South to provide
oxide ore to the Bogoso CIL processing plant;

    --  Completion of a feasibility study and decision to mine, by May 2007,
on the Hwini-Butre and Benso projects, as a source of high grade ore for our
Wassa processing plant, by May 2007;

    --  Completion of a feasibility study on the Prestea Underground, West
Reef, deposit by year end 2007; and

    --  Completion of a power project, with three other companies, by
mid-2007 to supplement our power requirements in the second half of 2007.

    Capital expenditure requirements in 2007, excluding the development of
Hwini-Butre and Benso, are expected to be about $73 million. These
expenditures include:

    --  Final costs for the Bogoso Sulfide Expansion Project of $15 million;

    --  Acquisition and development costs for Pampe of $0.6 million;

    --  Development costs for Prestea South of $2.8 million;

    --  Sustaining capital expenditure at Mampon of $0.2 million;

    --  Exploration expense and deferred exploration of $14.6 million;

    --  Contribution to mining consortium powerhouse project of $10 million;

    --  Hwini-Butre and Benso feasibility study costs of $0.6 million;

    --  Sustaining capital expenditure at Bogoso/Prestea of $19.6 million;

    --  Sustaining capital expenditure at Wassa of $6.2 million; and

    --  Assessment feasibility costs for Prestea Underground of $5.8 million.


    The following information is summarized and excerpted from the Company's
audited consolidated financial statements:

    Condensed Consolidated Balance Sheets as of December 31
    ($ in thousands)                                     2006      2005
    Cash and short term investments                     $27,108   $89,709
    Other current assets                                 63,426    43,080
    Property, plant and equipment                        93,058    84,527
    Deferred exploration                                167,983   167,532
    Mine properties                                     136,775   118,088
    Construction-in-progress                            165,155    36,707
    Other long term assets                               10,269    24,960
    Total assets                                       $663,774  $564,603

    Current liabilities                                 $69,151   $40,815
    Long term debt                                       66,911    64,298
    Asset retirement obligations                         16,034     8,286
    Deferred income tax payable                          42,154    45,072
    Fair value of derivatives                                 -     7,263
    Minority interest                                     7,424     6,629
    Shareholders' equity                                462,100   392,240
    Total liabilities and shareholders' equity         $663,774  $564,603

    Condensed Consolidated Statements of Operations for the year ended
     December 31
    ($ in thousands, except per share amounts)             2006      2005
    Revenues                                           $128,690   $95,465
    Mining operations expense                            92,730    79,609
    Depreciation, depletion and amortization             21,460    15,983
    Accretion of asset retirement obligation                835       752
    General and administrative expenses                  10,873     8,631
    Foreign exchange gain                                (2,330)      574
    Interest expense                                      1,846     2,416
    Derivative loss                                       9,589    11,820
    Gain on partial sale of investment in EURO          (50,903)     (977)
    Gain on sale of investment in Moto                  (30,240)        -
    Other expenses                                        3,309     2,841
    Net (loss)/income before minority interest           71,521   (26,184)
    Minority interest                                      (794)     (277)
    Income tax expense/(recovery)                        (6,038)   12,930
    Net (loss)/income                                   $64,689  $(13,531)
    Earning/(loss) per share - basic                     $0.312   $(0.094)
    Earnings/(loss) per share - diluted                  $0.308   $(0.092)

    Condensed Consolidated Statements of Cash Flows for the year ended
     December 31
    ($ in thousands)                                        2006     2005
    Cash (used in)/provided by operations                 $5,398   $1,060
    Cash used in investing activities                    (92,122) (67,489)
    Cash provided by financing activities                 24,123  143,261
    Increase/(decrease) in cash and cash equivalents     (62,601)  76,832
    Cash and cash equivalents at end of year             $27,108  $89,709


    Golden Star holds a 90% equity interest in the Bogoso/Prestea and Wassa
open-pit gold mines in Ghana. In addition, Golden Star has an 81% interest in
the currently inactive Prestea Underground mine and various other property
interests in Ghana, as well as gold exploration interests elsewhere in West
Africa and in the Guiana Shield of South America. Golden Star has
approximately 232 million common shares outstanding.

    Statements Regarding Forward-Looking Information: Some statements
contained in this news release are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Investors are
cautioned that forward-looking statements are inherently uncertain and involve
risks and uncertainties that could cause actual results to differ materially.
Such statements include comments regarding the total capital cost of the
Bogoso Sulfide Expansion Project and the estimated commencement of commercial
production, our 2007 and 2008 production estimates, including production
estimates for the new Bogoso Sulfide Expansion Project once completed, the
establishment and estimates of mineral reserves and non-reserve mineral
resources, the recovery of any mineral reserves, planned operations, including
the potential mining of Hwini-Butre and Benso properties and the potential
processing of such ore at Wassa, anticipated funding, construction cost
estimates, construction completion dates, equipment requirements, production,
production commencement dates, grade, processing capacity, recoveries,
potential mine life, results of feasibility and technical studies, timing of
the completion of the feasibility studies for the Hwini-Butre and Benso
properties and for the Prestea Underground, development, costs, expenditures,
mine re-opening and exploration. Factors that could cause actual results to
differ materially include timing of and unexpected events during construction,
expansion and start-up; variations in ore grade, tonnes mined, crushed or
milled; variations in relative amounts of refractory, non-refractory and
transition ores; delay or failure to receive board or government approvals;
timing and availability of external financing on acceptable terms; technical,
permitting, mining or processing issues, and fluctuations in gold price and
costs. There can be no assurance that future developments affecting the
Company will be those anticipated by management. Please refer to the
discussion of these and other factors in our Form 10-K for 2006. The forecasts
contained in this press release constitute management's current estimates, as
of the date of this press release, with respect to the matters covered
thereby. We expect that these estimates will change as new information is
received and that actual results will vary from these estimates, possibly by
material amounts. While we may elect to update these estimates at any time, we
do not undertake to update any estimate at any particular time or in response
to any particular event. Investors and others should not assume that any
forecasts in this press release represent management's estimate as of any date
other than the date of this press release.

    Non-GAAP Financial Measures: In this news release, we use the terms
"total production cost per ounce", "total cash cost per ounce" and "cash
operating cost per ounce." Total cash cost per ounce is equal to total
production costs less depreciation, depletion, amortization and asset
retirement obligation accretion divided by the number of ounces of gold sold
during the period. Cash operating cost per ounce is equal to total cash costs
less production royalties and production taxes, divided by the number of
ounces of gold sold during the period. We use total cash cost per ounce and
cash operating cost per ounce as key operating indicators. We monitor these
measures monthly, comparing each month's values to prior period's values to
detect trends that may indicate increases or decreases in operating
efficiencies. These measures are also compared against budget to alert
management to trends that may cause actual results to deviate from planned
operational results. We provide these measures to our investors to allow them
to also monitor operational efficiencies of our mines. We calculate these
measures for both individual operating units and on a consolidated basis.
Total cash cost per ounce and cash operating cost per ounce should be
considered as Non-GAAP Financial Measures as defined in SEC Regulation S-K
Item 10 and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with GAAP. There are material
limitations associated with the use of such non-GAAP measures. Since these
measures do not incorporate revenues, changes in working capital and
non-operating cash costs, they are not necessarily indicative of operating
profit or cash flow from operations as determined under GAAP. Changes in
numerous factors including, but not limited to, mining rates, milling rates,
gold grade, gold recovery, and the costs of labor, consumables and mine site
general and administrative activities can cause these measures to increase or
decrease. We believe that these measures are the same or similar to the
measures of other gold mining companies, but may not be comparable to
similarly titled measures in every instance.

For further information:

For further information: GOLDEN STAR RESOURCES LTD. Tom Mair,
+1-800-553-8436 Chief Financial Officer Bruce Higson-Smith, +1-800-553-8436
Vice President Corporate Development Anne Hite, +1-800-553-8436 Investor
Relations Manager

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