Crocodile Gold Commences Stope Ore Production at Cosmo Mine
TORONTO, ONTARIO–(Marketwire – March 19, 2012) – Crocodile Gold Corp. (TSX:CRK)(OTCQX:CROCF)(FRANKFURT:XGC) ("Crocodile Gold" or the "Company") announces that on the 29th of February 2012, the first stope slot raise was fired which commenced ore production from stopes in Zone A. Since December 2011, underground ore has only been obtained from development activity and the commencement of stope ore production will increase underground ore mining rates significantly.
In February, Crocodile Gold processed 144,000 tonnes of ore at an average grade of 1.10 g/t Au, with a 94% mill recovery, for gold production of 4,700 ounces-up 40% month over month. This is in line with the Company's 2012 guidance of 75,000-85,000 ounces as the Cosmo Mine continues to ramp up to full production. Mill feed was predominately sourced from the West Howley pit, with Cosmo underground ore making up approximately 13% of the ore processed during the month.
|Ore Processed (t)||119,000||144,000||263,000|
|Average Grade (g/t Au)||0.95||1.10||1.00|
|Mill Recovery (%)||90%||94%||93%|
|Gold oz Produced||3,300||4,700||8,000|
|This table is compiled from unaudited production figures. Audited results can have slight variations and will be released as part of the Company's Quarterly Reporting.|
David Keough, Crocodile Gold's Chief Operating Officer, commented, "The commencement of stope ore production from Cosmo's Zone A is another significant milestone for the Company. Zone A is a lower grade ore zone, however this zone is being mined as a trial stoping area to optimize drilling and blasting parameters, establishing over-break and dilution factors and operational practices. We expect that this will be invaluable experience for the underground production teams prior to commencing ore production in the higher grade Eastern Lode."
March development metres at the Cosmo Mine are anticipated to be similar to February and ore production will increase due to stope ore mining from Zone A. Some development ore will be mined from the Eastern Lode later in the month. Tonnes processed at the Union Reefs mill facility should be similar to February's results.
During February, a total of 346 metres of underground development along with 11 metres of vertical development was completed which was a slight increase from January's results. This development included the start of boring for Ventilation Shaft No 3. Refer to Figure 1.0 – 2012 Budget Long Section for development progress. In addition, a total of 10,000 tonnes of development ore grading 2.5 g/t Au was mined from the Zone A area. As more production ore is extracted during the ramp up of the Cosmo Mine the Company expects to see an increase in the ore grade.
Also in February, open pit ore was extracted from both the West Howley and Rising Tide pits. Ore feed to the mill was solely sourced from the lower grade Howley West pit due to the limited wet season access to the Rising Tide operation. Infrastructure (roads and pumping) established at West Howley are constructed to remain operational during monsoonal weather conditions. The ore from the Rising Tide pit is being stockpiled on site for processing when weather conditions improve and the waste is being used to cap an old tailing storage facility as part of the reclamation commitment. The West Howley pit is on target to finish mining in April and ore then will be sourced from the Rising Tide and North Point pits.
Exploration activities for the month consisted of the continuation of diamond drilling at the Company's Prospect and Crosscourse deposits in the Union Reefs area. Current drilling is now focused on close spaced in-fill holes along a 200 metre strike length of the Prospect deposit. For the month, 2,810 metres were drilled with two diamond rigs compared to a forecast of 2,464 metres. Mineral resources for the Prospect deposit will be calculated during March. A revised scoping study to assess the economic viability of underground mining at Union Reefs will commence in the latter part of March for completion by mid-April.
Significant assay results from the Company's Iron Blow base and precious metal massive sulphide deposit were recently released and include:
- 2.72g/t Au and 88.95g/t Ag, (Au eq 4.3 g/t*) over 142.05 meters in hole IBDH007 including 5.9 g/t Au, 481.6g/t Ag, (Au eq 14.7 g/t), 0.61% Cu and 17% combined Pb /Zn over 20.3 metres and 24.0 g/t Au over 3.0m
- 6.6 g/t Au, 306.6 g/t Ag, (Au eq 12 g/t), 0.34% Cu, and 11.4 % Pb/Zn over 4.05m in hole IBDH021
- 2.97 g/t Au, 121.3 g/t Ag, (Au eq 4.97 g/t), 0.51% Cu, and 8.5% combined Pb/Zn over 6.35 metres in hole IBDH021
- 2.28 g/t Au, 454.52 g/t Ag, (Au eq 10.5 g/t) 0.19% Cu, and 13.54% combined Pb/Zn over 5.45 metres in hole IBDH015
- 0.68g/t Au, 53.3 g/t Ag, (Au eq 1.65 g/t), 0.16% Cu, and 9.69% combined Pb/Zn over 13.97 metres in hole IBDH015
*Au eq = gold equivalents: calculated on the ration of 55 g silver = 1 g gold
The Company is very encouraged by these results and a revised resource statement is expected to be finalized in 2012.
As of this release, Crocodile Gold confirms that the private placement financing has closed on March 15, 2012 and gross proceeds of $34.5 million were raised. The company intends to use these funds to further advance exploration at the company's Union Reefs project as have been detailed in the exploration section of this release. As well, preliminary exploration efforts will continue at the Company's Maud Creek project.
About Crocodile Gold
Crocodile Gold is a Canadian company with operating gold mines in the Northern Territory of Australia with a land package of over 3,300 km2. Crocodile Gold is currently mining a number of open pits in the Howley Corridor. The Company is also developing the Cosmo underground mine. Ore is processed at the Union Reefs Mill with a capacity of 2.4 million tonnes per year. Crocodile Gold has 3.175 million ounces of NI 43-101 compliant Measured and Indicated mineral resources and 2.14 million ounces of Inferred mineral resources (see the NI 43-101 compliant technical report entitled "Report on the Mineral Resources and Mineral Reserves of the northern Territory Gold and Base Metals Properties for Crocodile Gold Corp." by Fleur Muller, Mark Edwards and Heath Gerritsen dated April 4, 2011, filed under the Company's profile on SEDAR for the details regarding these mineral resource estimates). The Company has an extensive exploration program in place and is drilling on several key properties on its expansive land package. Crocodile Gold's main focus is on the Cosmo Mine, the Union Reefs and Maud Creek project areas.
David Keough F.AusIMM of Crocodile Gold Inc is a "qualified person" as such term is defined in National Instrument 43-101 and has reviewed and approved the scientific technical information and data included in this press release. Quality Assurance and
1. Drill samples were assayed at NTEL in Darwin
2. Gold Assay results are based on 50g fire assays, base metal analysis are from ICPMS (Inductively Coupled Plasma Mass Spectrometry)
3. All intersections from diamond samples are either NQ or HQ half-core.
4. Diamond sample intervals are determined using lithological controls or 1.0m whichever is larger
5. Mean gold grades have been calculated on a minimum of 1.0m interval, 0.5 g/t lower cut-off and maximum 3m internal dilution. No upper cut has been applied
6. All intersections are down-hole intervals.
7. All deviations have been verified by down hold camera.
8. QAQC for these holes has been checked and verified through blind standards, field duplicates, lab repeats and barren flushes. QAQC results are within expected limits
Certain information set forth in this press release contains "forward-looking statements", and "forward-looking information" under applicable securities laws. Except for statements of historical fact, certain information contained herein constitutes forward-looking statements which include management's production projections and cash costs, of Crocodile Gold's future plans, operations and mineral resource estimates and are based on Crocodile Gold's current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. Some of the forward-looking statements may be identified by words such as "expects" "anticipates", "believes", "projects", "plans", and similar expressions. These statements are not guarantees of future performance and undue reliance should not be placed on them. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Crocodile Gold's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to: liabilities inherent in mine development and production; geological, mining and processing technical problems; Crocodile Gold's inability to obtain required mine licenses, mine permits and regulatory approvals required in connection with mining and mineral processing operations; competition for, among other things, capital, acquisitions of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in commodity prices and exchange rates; currency and interest rate fluctuations; various events which could disrupt operations and/or the transportation of mineral products, including labour stoppages and severe weather conditions; the demand for and availability of rail, port and other transportation services; the ability to secure adequate financing and management's ability to anticipate and manage the foregoing factors and risks. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Crocodile Gold undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.
To view the figure associated with this press release, please visit the following link: http://media3.marketwire.com/docs/CrocFig.pdf