TORONTO, ONTARIO--(Marketwired - April 16, 2013) - Crocodile Gold Corp. (TSX:CRK)(OTCQX:CROCF)(FRANKFURT:XGC) ("Crocodile Gold" or the "Company") produced 48,539 ounces of gold in the first quarter of 2013, making a strong start towards achieving the Company's 2013 production goal. Crocodile Gold also unwound its entire hedged gold position and applied the profits of this unwind to pay down the majority of its outstanding credit facility, considerably improving the Company's balance sheet.
| Production Summary | ||
| First Quarter 2013 | Full Year 2012 Production (1) | |
| Ore Processed (t) | 555,286 | 2,002,528 |
| Average Grade (g/t Au) | 3.24 | 2.79 |
| Mill Recovery (%) | 84.8 | 88.0 |
| Gold Ounces Produced | 48,539 | 155,523 |
| Note 1: Includes production from Fosterville and Stawell from May 4, 2012, the acquisition date of the mines | ||
Commenting on these production results and recent events, Chantal Lavoie, President and CEO of the Company, said: "The year is off to an excellent start with all of our assets performing to plan. With the recently completed $34.5 million debenture offering, the Company is in strong position to pursue its growth initiatives, but we are also mindful of the pressure lower gold prices will have on operating margins should the lower prices persist. I am also very pleased that, with the swift support of the Board, the Company has been able to considerably reduce its debt through a full unwind of our gold swaps. The balance sheet is now considerably stronger, and the Company has materially greater flexibility to pursue all its strategic initiatives."
Unwinding of Gold Swap Contracts
As part of the debt financing for the acquisition of Fosterville and Stawell, the Company entered into a series of swaps with Credit Suisse that effectively sold forward 8,000 ounces of gold per month at a fixed price of A$1,540 per ounce. Starting on April 15 th and continuing into April 16 th , the Company fully unwound its remaining hedges at an equivalent US$ spot gold price of approximately $1,350 an ounce. The proceeds from this unwind netted the Company A$57.9 million which was used to reduce the outstanding credit facility from A$69.2 million to A$11.3 million. The remaining balance on the credit facility will be repaid in equal quarterly installments over the next 18 months.
Operational Update-State of Victoria
- The Fosterville Gold Mine (FGM) produced 201,009 tonnes from the Harrier and Phoenix zones during the first quarter at an average grade of 4.58 g/t Au. The operation processed 190,026 tonnes of ore at a grade of 4.74 g/t Au with a recovery rate of 81.4%, resulting in gold production of 23,556 ounces for the quarter. Mine development continued at an average advance rate of 595 metres per month during the quarter.
- The Stawell Gold Mine (SGM) continues to transition from its underground mining activities, completing stoping in the lower areas of the mine and retreating back up the mine to access remnant ounces. During the quarter it mined 154,087 tonnes of underground ore at an average grade of 2.72 g/t Au which it supplemented with surface oxide material for a total of 213,132 tonnes processed at an average grade of 2.06 g/t Au. SGM achieved a recovery rate of 85.6%, which resulted in gold produced of 12,228 ounces. SGM expects to complete underground mining in the third quarter 2013 at which point it will focus on processing surface oxide stockpiles as the Company develops the Big Hill Project.
Operational Update-Northern Territory
- The Cosmo Mine continues to ramp-up its production after declaring commercial production on March 1, 2013, producing 150,955 tonnes of ore during the quarter at an average grade of 3.32 g/t Au out of which approximately 9,000 tonnes was left to be processed as of March 31, 2013. The underground ore fed to the Union Reefs mill was supplemented earlier in the quarter by lower-grade surface stockpiles, resulting in 152,128 tonnes processed during the quarter at an average grade of 3.02 g/t Au. The mill achieved a recovery rate of 86.4% for the quarter, resulting in gold production of 12,755 ounces. The cause of lower recoveries has been determined to be insufficient residence time in the leaching section and appropriate adjustments have been made to the processing circuit with recoveries having returned to normal levels around 90%.
- The Cosmo Mine achieved an average development rate of 520 meters in the quarter, in line with operational requirements for the next few years of production. The continued strong development profile ensures Cosmo is on target to reach its full production rate of approximately 2,100 tonnes per day by the fourth quarter of 2013.
Project Development - Update
In first quarter of 2013, Crocodile Gold took the first steps in the permitting process for the Big Hill Project with the submission of an Environmental Effect Statement (EES) referral document to the State of Victoria, Australia. The Company and SGM have also commenced community initiatives to engage stakeholders in the permitting process. Specialists are being engaged as the Company works towards a feasibility study for the project.
Additional details of the first quarter of 2013 will be provided in the Management Discussion and Analysis report, which will be released in conjunction with the Company's interim financial statements set to be released mid-May.
About Crocodile Gold
Crocodile Gold is a Canadian gold mining and exploration company with three operating mines in the Northern Territory and the State of Victoria, Australia. The Company has a combined land package in excess of 4,000 sq. km. The objective of Crocodile Gold is to continue production from its three operating mines, Cosmo, Stawell and Fosterville, while also advancing development programs to further organic growth. For additional information, please visit our website www.crocgold.com .
Follow us on Twitter @crocgold_crk or Facebook www.facebook.com/CrocodileGoldCorp .
Qualified Person
F. W. Nielsen, P.Geo, V.P. Exploration of Crocodile Gold Corp. is a "qualified person" as such term is defined in National Instrument 43-101 and has reviewed and approved the technical information and data included in this press release.
Cautionary Note
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 licences, 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 that 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.
