Crocodile Gold Corp.
TSX : CRK

Crocodile Gold Corp.

January 14, 2010 07:45 ET

Crocodile Gold Announces Initial Exploration Results for Howley Project: Resource Increase Likely; Mineralization Extended and Open in All Directions

TORONTO, ONTARIO--(Marketwire - Jan. 14, 2010) - Crocodile Gold Corp. (TSX:CRK) ("Crocodile Gold" or the "Company") is pleased to provide an update on the exploration program currently underway on its Howley project, in the Northern Territory of Australia (refer to Figure 1 below for location map). The project is currently the site of an ongoing 40,000 metre (US$4.4 million) reverse circulation drill program which is part of the previously announced US$8.4 million exploration program being conducted on the Company's extensive landholdings in the Northern Territory (refer to Crocodile Gold press release dated November 12, 2009).

Highlights of the first phase of exploration results are:

- Mineralization has been significantly expanded in the West Zone Area which is to the west of the current open pits, with intersections including 1.10 g/t Au over 54 metres from surface, and 4.28 g/t Au over 6 metres. The Company believes that these results may lead to an increase in resources in this area.

- Infill drilling in the core area of the #2 Pit where mining is initially focused, confirms continuity of mineralization with intersections including 1.75 g/t Au over 25 metres and 5.83 g/t Au over 6 metres. Mineralization was encountered as deep as 175 metres below surface.

- Mineralization was intersected 800 metres south of the #2 Pit with shallow intersections up to 1.03 g/t Au over 15 metres.

- The mineralized system remains open to the north, south, east and west and at depth.

- The Howley area is the southern part of a more than 25 kilometre system within the Company's tenements that hosts certain existing shallow NI 43-101 compliant resources estimates.

- The Company believes that the initial results are sufficiently encouraging to warrant an updated resource estimate that is currently underway, and Crocodile Gold anticipates the drill program to result in increased mineral resource estimates.

Drill results are shown in Table 1 below.

West Zone Area

The West Zone Area of mineralization is estimated to be located up to 200 metres west of the main Howley mineralization but extends closer to it towards the north (refer to Figure 2: Cosmo/Howley Plan View). The West Zone Area is in excess of 100 metres wide but is not currently well defined. The purpose of this exploration program is to better define this area and to investigate the possibility of increasing estimated mineral resources in order to enlarge the #2 Pit.

The initial results are extremely encouraging. Substantial near surface mineralization was encountered in a number of holes. Highlights include 1.10 g/t Au over 54 metres in drill hole CSRC 451 which was mineralized for its entire length from surface (refer to Figure 3: Section 4475N - Resource Model and Current Drilling). Narrower higher grade zones were encountered within the wider intervals of mineralization, including for example, 4.28 g/t Au over 6 metres in drill hole CSRC 451.

Crocodile Gold believes that these results demonstrate excellent continuity of the West Zone Area, and this area is the principal focus of the updated resource estimate which is in progress. Mineralization remains open to the south and at depth. The deepest hole in the current program is only 150 metres below surface.

In addition, this program identified an additional zone of near surface mineralization approximately 100 metres west of the West Zone Area with intersections of up to 0.50 g/t Au over 33 metres in hole CSRC 459. Crocodile Gold believes that this suggests the mineralization remains open to the west and that the mineralized corridor could locally be in excess of 500 metres wide, compared with the previously measured 400 metres width.

Infill Drilling

The initial focus of mining at Howley is planned to be the #2 Pit. Consequently, a key goal for this exploration program was to complete sufficient infill drilling to provide increased confidence in the resources to be mined. Results to date have been very successful in achieving this goal with intersections of wide mineralized zones including 1.75 g/t Au over 25 metres in drill hole CSRC 476 and 1.63 g/t over 28 metres in drill hole CSRC 482. In addition, a number of narrower high grade intersections were encountered including 5.83 g/t Au over 6 metres in drill hole CSRC 482.

The majority of past drilling was less than 100 metres below surface, and one objective of the current program is to test for mineralization as deep as 200 metres below surface. To date mineralization has been encountered as deep as 175 metres below surface with intervals including 1.30 g/t Au over 15 metres in drill hole CSRC 515 and 1.03 g/t Au over 15 metres in drill hole CSRC 517.

Mineralization south of Howley Pits

The two kilometre distance between the Cosmo open pit and the Howley #2 Pit has not previously been tested. Crocodile Gold has completed a number of drill holes on some widely spaced (200 metre) sections in order to test for the potential of additional mineralization in this area.

Drill hole CEX 013 intersected 1.03 g/t Au over 15 metres at a depth of approximately 50 metres below surface, and approximately 800 metres south of the #2 Pit. The Company considers these results to be very significant as it indicates the potential for additional mineralization in the Cosmo/Howley gap.

Mineralization on East Limb of Anticline

The majority of historical exploration has focused on the west limb of the anticlinal structure which hosts the Cosmo/Howley corridor mineralization. The east limb has received little attention. The next phase of the current program will test this area with a number of drill holes to a vertical depth of approximately 200 metres. Crocodile Gold considers this target area to be a high priority area. In the area to the east of the Howley #4 Pit several significant historic high grade intersections have been obtained (Figure 2). In many cases the holes were incompletely sampled. Examples of some of these intersections include 58.1 g/t Au over 2 metres and 18.26 g/t Au over 7 metres in drill hole CH063 at a depth of only 50 metres below surface.

Summary

In releasing this information, President and CEO, Mike Hoffman, stated, "The results of the program to date have been very encouraging. We believe that the infill drilling has confirmed the validity of the resource model and has provided greater confidence in our mining plans. We anticipate increasing our estimated mineral resources in the near future. In addition, our drilling has confirmed that mineralization does continue at depth.

We believe that the results support our belief that the Howley mineralization is part of a larger system. We have identified mineralization within a corridor which is up to 500 metres wide over a strike length of more than 3.5 kilometres, which remains open to the north, south, east, west and at depth. The area is part of a larger mineralized geological trend which extends for more than 25 kilometres to the north, on ground held by Crocodile Gold and which already hosts near surface NI 43-101 compliant in inferred resources of approximately 240,000 ounces.

We are also looking forward to testing the potential for mineralization on the east limb of the anticline to follow up some encouraging historic results.

We look forward to providing a resource update for the Howley Project in the near future.

Crocodile Gold is on track to meet its production target of more than 100,000 ounces of gold in 2010 from the Howley #2 Pit and the Brocks Creek Underground Mine."



Table 1: Howley Project - Phase 1 RC drill results (partial list)

----------------------------------------------------------------------------
Hole No. Easting Northing From (m) To (m) Interval Grade
(m) (Au g/t)
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CEX 013 5141 3598 53 68 15 1.03
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CSRC 442 5114 4370 26 97 71 0.51
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including 26 63 37 0.66
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CSRC 443 5140 4370 1 57 57 0.82
----------------------------------------------------------------------------
including 3 18 15 1.53
----------------------------------------------------------------------------
and 3 26 23 1.20
----------------------------------------------------------------------------
CSRC 444 5146 4395 13 64 51 0.43
----------------------------------------------------------------------------
including 15 19 4 1.06
----------------------------------------------------------------------------
and 53 56 3 1.19
----------------------------------------------------------------------------
CSRC 445 5163 4400 0 47 47 0.54
----------------------------------------------------------------------------
including 48 56 8 1.44
----------------------------------------------------------------------------
and 92 96 4 2.51
----------------------------------------------------------------------------
CSRC 446 5130 4400 30 79 49 0.67
----------------------------------------------------------------------------
including 39 46 7 1.55
----------------------------------------------------------------------------
and 67 79 12 1.00
----------------------------------------------------------------------------
CSRC 447 5110 4400 47 96 49 0.76
----------------------------------------------------------------------------
including 48 56 8 1.44
----------------------------------------------------------------------------
and 92 96 4 2.51
----------------------------------------------------------------------------
CSRC 448 5066 4400 20 48 28 0.75
----------------------------------------------------------------------------
including 37 47 10 1.12
----------------------------------------------------------------------------
CSRC 451 5180 4480 0 54 54 1.10
----------------------------------------------------------------------------
including 28 34 6 4.28
----------------------------------------------------------------------------
CSRC 455 5240 4560 76 90 14 0.86
----------------------------------------------------------------------------
including 76 84 8 1.26
----------------------------------------------------------------------------
CSRC 456 5200 4560 5 51 46 0.50
----------------------------------------------------------------------------
CSRC 459 5100 4560 30 63 33 0.50
----------------------------------------------------------------------------
CSRC 463 5260 4580 24 72 48 0.49
----------------------------------------------------------------------------
CSRC 465 5220 4580 17 32 15 0.91
----------------------------------------------------------------------------
including 24 32 8 1.55
----------------------------------------------------------------------------
CSRC 470 5134 4600 11 28 17 0.69
----------------------------------------------------------------------------
including 13 17 4 1.04
----------------------------------------------------------------------------
CSRC 471 5361 4601 55 59 4 5.89
----------------------------------------------------------------------------
CSRC 472 5300 4640 13 47 34 0.80
----------------------------------------------------------------------------
including 28 38 10 1.34
----------------------------------------------------------------------------
CSRC 473 5280 4640 49 78 29 0.78
----------------------------------------------------------------------------
CSRC 474 5260 4640 89 102 13 0.81
----------------------------------------------------------------------------
including 90 96 6
----------------------------------------------------------------------------
CSRC 476 5390 4725 73 98 25 1.75
----------------------------------------------------------------------------
including 73 91 18 2.18
----------------------------------------------------------------------------
and 73 78 5 3.82
----------------------------------------------------------------------------
CSRC 478 5381 4738 82 111 29 1.20
----------------------------------------------------------------------------
CSRC 482 5457 4880 106 134 28 1.63
----------------------------------------------------------------------------
including 106 112 6 5.83
----------------------------------------------------------------------------
CSRC 485 5340 4886 45 82 37 1.08
----------------------------------------------------------------------------
including 48 51 3 5.75
----------------------------------------------------------------------------
CSRC 486 5360 4910 54 68 14 1.51
----------------------------------------------------------------------------
CSRC 487 5388 4910 3 47 43 0.76
----------------------------------------------------------------------------
including 34 47 13 0.99
----------------------------------------------------------------------------
CSRC 489 5468 4910 125 166 41 1.36
----------------------------------------------------------------------------
including 125 137 12 2.13
----------------------------------------------------------------------------
CSRC 491 5373 4920 25 55 30 1.00
----------------------------------------------------------------------------
including 49 55 6 2.05
----------------------------------------------------------------------------
CSRC 497 5420 5208 32 70 38 0.77
----------------------------------------------------------------------------
including 43 59 16 1.34
----------------------------------------------------------------------------
CSRC 501 5393 5230 72 77 5 2.02
----------------------------------------------------------------------------
and 94 144 50 0.50
----------------------------------------------------------------------------
including 133 144 11 1.13
----------------------------------------------------------------------------
CSRC 502 5415 5250 64 71 7 1.41
----------------------------------------------------------------------------
CSRC 515 5347 4820 131 146 15 1.30
----------------------------------------------------------------------------
and 174 198 24 0.63
----------------------------------------------------------------------------
Including 174 186 12 0.90
----------------------------------------------------------------------------
CSRC 516 5410 4840 90 117 27 1.69
----------------------------------------------------------------------------
including 90 96 6 5.51
----------------------------------------------------------------------------
CSRC 517 5359 4869 186 201 15 1.03
----------------------------------------------------------------------------
HSRC 008 5275 4550 152 165 13 0.90
----------------------------------------------------------------------------
HSRC 012 5360 5450 27 77 50 0.77
----------------------------------------------------------------------------
including 45 74 29 0.90
----------------------------------------------------------------------------
and 61 77 16 1.02
----------------------------------------------------------------------------
HSRC 041 5290 4700 164 166 2 6.72
----------------------------------------------------------------------------
BHRC 025 5380 7480 3 5 2 3.97
----------------------------------------------------------------------------
and 97 104 7 1.52
----------------------------------------------------------------------------


Qualified Person

Alfred John Gillman of Odessa Resources Pty Ltd 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.

Drill core was assayed at Northern Australian Laboratories (NAL).

Results are based on 50g fire assays.

Face sampling reverse circulation drilling (1m intervals).

All intersections are downhole intervals.

Downhole surveying by downhole camera.

Collar co-ordinates confirmed by survey pick-up.

Quality control procedures included blasts of compressed air to clean jaw and roll crushers between samples, a barren flush of river sand to clean bowls in between samples, laboratory duplicate samples undertaken at a rate of 1 in 10 and the insertion of NAL internal standards to monitor performance.

About Crocodile Gold

Crocodile Gold is a Canadian company that has completed the acquisition of recent past producing gold assets in the Northern Territory of Australia. The assets comprise an area greater than 3,500 square kilometres and are located approximately 90 to 285 kilometres south of the capital city, Darwin, and include the Burnside Project, Tom's Gully Project and Maud Creek Project. The property contains 3.0 million ounces of NI 43-101 compliant measured and indicated resources (40.9 million tonnes at an average grade of 2.3 g/t gold), and 1.8 million ounces of inferred resources (25.9 million tonnes at an average grade of 2.3 g/t gold) (See Management Information Circular dated October 5, 2009 and Crocodile Gold Press Release dated September 8, 2009). The Burnside Project includes the Brocks Creek underground mine, the Howley open pit mine and several additional deposits along the Cosmo/Howley corridor, including the undeveloped Cosmo underground deposit. The Tom's Gully Project includes the Tom's Gully underground mine and the former Mt Bundy (Rustler's Roost) Mine. Crocodile Gold owns the 8,000 tpd Union Reefs mill and the 800 tpd Tom's Gully mill. Crocodile Gold trades under the symbol CRK on the Toronto Stock Exchange.

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.

Figure 1: Crocodile Gold Northern Territory Location Map is available at the following link: http://media3.marketwire.com/docs/crk0114fig1.pdf.

Figure 2: Cosmo/Howley Plan View is available at the following link: http://media3.marketwire.com/docs/crk0114fig2.pdf.

Figure 3: Section 4475N - Resource Model and Current Drilling is available at the following link: http://media3.marketwire.com/docs/crk0114fig3.pdf.

Contact Information

  • Crocodile Gold Corp.
    Michael Hoffman
    President and CEO
    416-861-2964
    or
    Crocodile Gold Corp.
    Ashleigh Clelland
    Manager, Investor Relations
    416-861-5899
    info@crocgold.com