Centerra
Gold Inc. has increased its 2011 exploration budget by 18 per cent to $40
million, with a portion of that additional money going towards its
“significant” gold and silver discovery in Mongolia. The company has said
about $4 million of the funds will be dedicated to further drilling at the
property.

To
date, Centerra has spent $6.5 million on the on the Altan Tsagaan Ovoo property
since acquiring it in May 2010 from Cogegobi, a wholly-owned subsidiary of
Areva. From May 2010 to May 2011, Centerra drilled 124 holes for a total of
21,753 meters. This work identified four closely spaced breccia pipes, three of
which carry significant precious and base metal mineralization.

Gold
grades in upper and lower parts of the pipes are similar with grades ranging
from 0.1 grams per tonne of gold to as high as 160 g/t gold. Silver contents
generally are 10 to 30 g/t, but range as high as 500 g/t silver. The deposits
also have lead and zinc mineralization.

“We
are very excited about this new discovery in what we view as a new emerging
mineral district,” said Steve Lang, Centerra”s president and chief
executive.

“In
the past thirteen months, our exploration group has identified initial targets,
drilled those targets with very strong results and identified other potential
targets within our license package. Our board of directors has recognized the
potential of this project and has expanded our 2011 exploration budget to
continue the rapid advancement.”

The
ATO property is 60 kilometres east-northeast of Ulaanbaatar.