Castle Gold Corporation

Castle Gold Corporation

September 27, 2007 10:02 ET

Castle Gold Sells First El Castillo Gold at US $715 Per Ounce

TORONTO, ONTARIO--(Marketwire - Sept. 27, 2007) - Castle Gold Corporation ("Castle Gold" or the "Company") (TSX VENTURE:CSG) announces the first gold sale from its 100% owned El Castillo mine in Durango, Mexico. The Company capitalized on the recent increase in the price of gold by selling 450 ounces at an average realized price of US$715 per ounce. This first sale of El Castillo gold represents production from the first month-and-a-half of pre-production leaching that began in July.

Production at El Castillo is ramping up to the initial operating rate of 200,000 tonnes of ore and waste per month. Ore is currently being placed on the leach pad at a rate of 75,000 tonnes per month and will increase to 100,000 tonnes per month over the next two months as the pit is developed. Further increases to Castillo's production rate are planned for 2008.

The El Castillo mine is expected to be producing at a rate of 15,000 ounces of gold per year by year end. The gold production rate is forecast to increase to 30,000 ounces per year during 2008. Consideration will also be given to expanding the production rates beyond 30,000 ounces of gold per year through one or two additional expansions.

"I am very pleased that our mine building team has successfully built a second mine in less than two years," stated Christopher Babcock, President and CEO of Castle Gold. "This tremendous achievement epitomizes our mining objectives of focusing on the fundamentals, enhancing efficiencies, growing production rates, and thereby profitability, at our two producing gold mines. We could not be more excited about the timing of these events with the price of gold extending to new highs coincident with the ramp-up of the gold production at El Castillo."

Darren Koningen (P. Eng.), Vice-President - Operations, is the Qualified Person under National Instrument 43-101 for the El Castillo Mine.

Castle Gold is a growth oriented gold producer focused on expanding gold production within the Americas. Castle Gold owns a 100% interest in the El Castillo gold mine in Mexico and a 50% interest in the El Sastre gold mine in Guatemala. Castle Gold is also advancing exploration and development work at its La Fortuna gold project in Mexico and at its El Sastre, Bridge and Lupita projects in Guatemala.

Current issued and outstanding share capital: 70,195,647


The information referred to referred to above contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the future price of metals, timing of exploration activities, mine life, economic viability and estimated internal rate of return, estimation of mineral resources, the results of drilling, estimated future capital and operating costs, future stripping ratios, projected mineral recovery rates and plans for developing, the projects. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "can", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the companies to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the exploration and potential development of the projects, risks related to international operations, the actual results of current exploration activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of metals. Although the companies have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The companies do not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy of this news release.

Contact Information

  • Castle Gold Corporation
    Court Babcock
    Investor Relations
    (778) 928-5006 or Toll Free 1-866-646-3274
    Coal Harbour Communications Inc.
    (604) 662-4505 or Toll Free 1-877-642-6200