TORONTO, ONTARIO--(Marketwire - July 12, 2012) - Crocodile Gold Corp. (TSX:CRK)(OTCQX:CROCF)(FRANKFURT:XGC) ("Crocodile Gold" or the "Company") is pleased to announce it produced 36,117 ounces of gold in the second quarter of 2012 and 46,876 ounces year to date in the period ending June 30, 2012.
|Ore Processed (t)
|Average Grade (g/t Au)
|Mill Recovery (%)
|Gold oz Produced
Note 1: Includes production from Fosterville and Stawell post May 4th acquisition
Note 2: Shown as reference and including Fosterville and Stawell production since January 1st 2012. YTD results through June 30, 2012.
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.
With the completion of the acquisition of the Fosterville ("FGM") and Stawell ("SGM") gold mines on May 4th, the Company significantly increased its gold production, more than tripling its production in the second quarter compared to the company's first quarter 2012 performance. For year over year comparison purposes, when the FGM and SGM mines are included as if they were owned by Crocodile on January 1, 2012, the Company's pro-forma gold production performance year to date through June 30, 2012 was approximately 95,000 ounces.
Commenting on these results, Chantal Lavoie, President and CEO of the Company said, "This year's second quarter has been transformational for our Company with the acquisition of the Fosterville and Stawell mines, the completion of the $75 million debt facility with Credit Suisse AG and the continued progress at our Cosmo project in the Northern Territory. At the operational level, best practices are already being shared and implemented and we have seen positive results at all the sites."
Operational Update-State of Victoria
- The Company successfully completed the acquisition of the FGM and SGM gold mines acquisition on May 4th. Associated with the acquisition, the Company completed a $75 million debt facility with Credit Suisse AG.
- The operating teams of FGM and SGM have been fully integrated into Crocodile Gold and after a transitional period in May, both mines produced more ounces of gold in June than in any other month in 2012.
- The Company completed operational reviews and made the decision to transition the operation of SGM, which will see underground mining activities being completed by the end of 2013. The decision to cease mining activities at SGM after 2013 will result in significantly reduced capital expenditures at SGM starting in the fourth quarter of 2012 and continuing throughout 2013. This should result in material free cash flow generation from SGM in this period during which gold is being produced, but no development capital is being spent.
Operational Update-Northern Territory
- At Cosmo, underground drilling continued and results to date confirm the ore zones are wider than expected in several locations. The wider ore zones should allow for simpler mining techniques, lower dilution and ultimately lower cost production which are all positive, long-term developments for Crocodile Gold.
- In the short-term, the wider ore zones require adjustments to the mining method and sequence. In conjunction with this, development rates have been lower than expected. Remedial plans have been developed with the main contractor, Leighton, and development rates in June reached all-time highs despite continuing labour shortages in the region.
- Trial mining in Zone A has been successful with lower than expected dilution and grades and metallurgical recoveries as per plan.
- The Company continued to progress on permitting the International open pit mine. This includes an amendment made to the project development sequence, in line with comments received from regulators. A production decision is still expected by the fourth quarter of 2012. The Company has not included any production from the International property in its 2012 guidance.
- The Company has successfully re-negotiated the ore haulage contract, which will see a significant reduction in associated costs over the next two years
- Surface mining activities at Rising Tide (Phase 1) were completed and the decision was taken to not proceed with the next phase nor with the remaining mining of the Princess Louise and North Point deposits, given lower than expected grade results and price escalation by the surface mining contractor.
Exploration and Advanced Projects - Update
- The Company completed its Union Reefs drilling program with nearly 11,500 meters drilled. Results will be used to update the mineral resources and mineral reserves model in the third quarter. In June, permits required to initiate the excavation of an exploration decline were received. A decision regarding the next phase of the project will be taken later this year.
- In June, a review was completed by an independent consultant confirming the applicability of BIOX technology, which is currently being utilized at the Fosterville Mine, to the Maud Creek deposit, therefore providing a technical and economical solution for gold recovery.
- On May 16th 2012, the Company signed a binding agreement with Primary Minerals NL of Perth, Australia for the sale of the Mt. Bundy property in the Northern Territory. This agreement remains subject to various conditions subsequent that are expected to be satisfied by the end of 2012.
Additional details of the second quarter will be provided in the Management Discussion and Analysis report, which will be released in conjunction with the Company's financial statements in mid-August.
About Crocodile Gold
Crocodile Gold is a Canadian company with operating gold mines in the Northern Territory of Australia and in the State of Victoria with a land package of over 3,900 square kilometres. Crocodile Gold is currently mining at the Fosterville and Stawell mines in the State of Victoria. In the Northern Territory, the Company continues to develop its Cosmo underground mine and is permitting the International open pit mine. The Northern Territory ore production is processed at the Union Reefs Mill with a capacity of 2.4 million tonnes per year.
At its Northern Territory properties, the Company has 3.175 million ounces of NI 43-101 reported Measured and Indicated mineral resources and 2.14 million ounces of Inferred mineral resources. These resources are inclusive of mineral reserves. At the State of Victoria properties, the Company has an additional 3.732 million ounces of NI 43-101 reported Measured and Indicated mineral resources and 0.622 million ounces of Inferred mineral resources. These are exclusive of mineral reserves which total 0.472 million ounces.
Crocodile Gold has an extensive exploration program in place in the Northern Territory and is exploring 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. In the State of Victoria, the Company has exploration programs in place designed to expand the resource base of each mine property.
For additional information, please visit our website www.crocgold.com. Follow us on Twitter (@crocgold_crk) or Facebook (www.facebook.com/CrocodileGoldCorp).
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.
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 the Company's expectations for future performance based on current drill results and past production, expected gold prices, 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, and 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.