Crocodile Gold Intersects Extension to High Grade Mineralized Structure 650 m South of the Existing Resource on the West Lode of Cosmo With First Hole Intersecting 8.6 Meters of 5.14 g/t Au
TORONTO, ONTARIO -- (Marketwire) -- 06/16/11 -- Crocodile Gold Corp. (TSX: CRK)(OTCQX: CROCF)(FRANKFURT: XGC) ('Crocodile Gold' or the 'Company') is pleased to announce a continued high grade intersection from the underground exploration drilling program currently underway at the Cosmo Deeps project located as shown in Figure 1.
Highlight of this drill result from DDH PHP1 includes:
-- 5.14 g/t Au over 8.6 meters including 16.4 g/t Au over 2 meters and 4.7
g/t Au over 1.6 meters in hole PHP1 (see Table 1)
The drill result from PHP 1 extends the Cosmo West Lode mineralization over 650 meters south of the current NI 43-101 mineral resource and approximately 300 meters further south of the last hole containing mineralization CP009W1. In addition, the mineralization was intersected 250 meters below surface.
Chantal Lavoie, the incoming President and CEO of Crocodile Gold commented: 'The development of the Cosmo underground mine is currently Crocodile Gold's highest priority with production steadily increasing through the last half of 2011 as production rates reach full capacity in the first half of 2012 which will increase overall production rates and dramatically decrease cash costs from current levels. We believe there is still significant exploration potential remaining at Cosmo; especially at the West Lodes. A major focus of the current Cosmo optimization study is to incorporate future production rate growth into the infrastructure being put in place underground so that any potential increases to the mineral resource and reserve can be exploited.'
Bill Nielsen, Vice President Exploration of Crocodile Gold commented: 'The results of this initial drilling are very encouraging as they have intersected mineralization in an area with no previous drilling. More work is required to understand this expanded mineralization envelope, as it is now on the footwall side of the dolerite unit. Additional underground drilling is currently being planned. Meanwhile, the surface diamond rig is testing the Western Lodes closer to the known Mineral Resource in an effort to significantly expand resources in this area. If successful in increasing the resources at the Western Lodes, the Company believes it can increase the number of ounces per vertical meter and with this there is a distinct possibility of increasing the production rate from the Cosmo Mine over the intermediate term from the existing planned infrastructure.'
Drilling at the Cosmo Deeps project has recommenced with both surface and underground diamond rigs operational. The first underground hole drilled was collared within the dolerite unit and projected towards the Western Lodes. This hole has intersected mineralization at a depth in excess of 250 meters vertical, approximately 650 meters south of the current resource and 300 meters south of the last known Western Lode intersection in hole CP009W1 (see press release dated September 28, 2010) - Figure 2, 3, 4.
The existing Cosmo Western Lode National Instrument 43-101 ('NI 43-101') resource is currently interpreted to be approximately 350 meters in strike length and around 250 meters in depth. With the encouraging drill results from CP009W1 and PHP 1, management believes that the mineralization strike length of the Western Lodes could potentially be up to 750 meters in strike length, or more than double the current resource. This interpretation is very preliminary and significantly more drilling is required to both definitively establish the continuity of mineralization and establish a NI 43-101 resource.
Table 1 - Drill Result Summary for PHP 1 and CP009W1
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Grid Coordinates Survey Data Interval
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Hole ID True Grade
Local Local From To Interval Width (g/t
Easting Northing Azimuth Dip (m) (m) (m) (m) Au)
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PHP1 5161.5 1221.0 250.8 -32.7 449.4 458.0 8.6 7.7 5.14
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including 449.4 451.0 1.6 1.5 4.7
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and 456.0 458.0 2.0 1.8 16.4
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Below are the previously released results for drillhole CP009W1
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Grid Coordinates Survey Data Interval
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Hole ID True Grade
Local Local From To Interval Width (g/t
Easting Northing Azimuth Dip (m) (m) (m) (m) Au)
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CP009W1 5217 1591 241 -54 207.2 224.9 17.7 12.2 6.85(i)
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and 228.0 230.9 2.9 2.1 2.95
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and 359.9 367.4 7.5 5.6 1.99
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and 371.9 379.4 7.5 5.8 2.02
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and 416.4 418.9 2.5 1.8 2.12
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and 522.4 531.9 9.5 7.4 2.00
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and 617.7 623.0 5.3 3.0 3.64
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and 697.8 701.7 3.9 1.6 3.43
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and 716.8 719.8 3.0 1.0 4.17
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and 722.1 724.2 2.1 0.8 8.38
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The intersection is interpreted to be a southern projection of the Western Lodes (see Figures 2, 3, 4). However, management believes the fact that it is in the footwall of the dolerite sill as opposed to the hanging wall, as seen further to the north and as in the Eastern Lodes, indicates that alternative interpretations are possible. Conceivably, the Western Lodes mineralization has cross-cut the dolerite unit. Further drilling and interpretive work will be required to resolve this issue.
About Crocodile Gold
Crocodile Gold is a Canadian company with operating gold mines in the Northern Territory of Australia and a land package of over 2,700 km2. Crocodile Gold is currently mining from the Howley open pit mine. Crocodile Gold commenced mining in November 2009 and announced its first gold pour in December 2009 at its Union Reefs Mill. The Company is currently developing the Cosmo underground mine. Ore is currently processed at the 2.4 million tonne per year Union Reefs Mill. Crocodile Gold has 3.175 million ounces of NI 43-101 compliant Measured and Indicated mineral resources (51.85 million tonnes at an average grade of 1.9 g/t gold) and 2.14 million ounces of Inferred mineral resources (36.35 million tonnes at an average grade of 1.8 g/t gold) (see Crocodile Gold press release April 26, 2011). The Company has an 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/Howley corridor and the Union Reef project area.
Qualified Person
Mark Edwards, Geology Manager of Crocodile Gold Australia Operations is a 'qualified person' as such term is defined in National Instrument 43-101 and has reviewed and confirmed the technical information and data included in this press release.
Notes:
1. Drill samples were assayed at Northern Australian Laboratories (NAL).
2. Assay results are based on 50g fire assays.
3. All intersections from diamond samples are half-core either NQ or HQ.
4. Diamond sample intervals are determined using lithological controls or 1.0m whichever is larger
5. Mean grades have been calculated on a minimum of 1.5m interval, 0.5 g/t lower cut-off and maximum 3m internal dilution.
6. All intersections are down-hole intervals.
7. All deviations have been verified by down hold camera.
8. Quality Assurance Quality Control ('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.
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 management's assessment 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 figures associated with this press release, please visit the following link: http://media3.marketwire.com/docs/crk_0616_figures.pdf
Contacts:
Crocodile Gold Corp.
Rob Hopkins
Manager, Investor Relations
416-861-5899
info@crocgold.com
www.crocgold.com