Crocodile Gold Corp.

Crocodile Gold Corp.

February 19, 2015 07:30 ET

Crocodile Gold Achieves Exploration Success on High-Grade Drill Results Reported at Stawell Gold Mines

High-Grade Drill Results Provide Upside for Potential Extension of Underground Operations at Stawell

TORONTO, ONTARIO--(Marketwired - Feb. 19, 2015) - Crocodile Gold Corp. (TSX:CRK)(OTCQX:CROCF)(FRANKFURT:XGC) ("Crocodile Gold" or the "Company") is pleased to announce positive results from Stawell Gold Mines' ("Stawell") multi-targeted underground drilling exploration program, undertaken throughout 2014, which focused on the upper levels of the mine between 180m and 705m levels below the surface. Results from underground diamond drilling include 14 high-grade intercepts from 33 drill holes, totaling 4,261 metres ("m"), completed during the course of a US$525,600 drill program. Drilling concentrated on exploring three main target areas, Federal-Albion South, U1 and Mariners. The target areas are located in the middle to upper portion of the Magdala system, a strongly mineralized system where underground mining is currently in progress. Current and extensive historical mining of Magdala would also allow target areas to be readily accessed in the future. Today's reported drill results are positive as they identify areas for potential resource growth and also provide upside for potential extension of the life of Stawell's underground operations.

2014 Key Highlights

  • High-grade drill intercepts for the Federal-Albion South Target on two mineralized lodes: the Extended lode (15.75(1) g/t Au over 2.70m [ETW 1.50m]) and Central Lode (5.66 g/t Au over 9.20m [ETW 7.60m]).
  • High-grade intercepts for the U1 Target on three mineralized lodes: the Dukes lode
    (9.29(1) g/t Au over 2.40m [ETW 1.70m]), Stockworks #1 lode (9.00 g/t Au over 7.55m [ETW 7.1m]) and Central Lode (5.74 g/t Au over 3.75m [ETW 1.8m]).
  • New high-grade drill intercept ending in mineralization above the Mariners Target area
    (13.15(2) g/t Au over 0.40m [ETW 0.3m]).
  • Confirmation of continuous gold mineralization in the Mariners Target area where five parallel lodes extend down-plunge from previous Mariners underground mining.

1) Visible gold present in drill intercept, 2) End of hole drill intercept, ETW - Estimated true width

Rodney Lamond, President and Chief Executive Officer, Crocodile Gold, commented: "We are very encouraged by the positive results from the 2014 exploration program at Stawell where underground drilling targeted growth of mineral resources outside previously reported models. During this period, mining at Stawell has also transitioned from deep in the mine to upper levels of the mine, where the extraction of remnant and other ore materials is currently in progress. After more than 30 years of continuous operation, and over 2.2 million ounces of gold production at Stawell, we believe that there is still strong potential for finding additional underground mineral resources. The 2014 drill results further support Crocodile Gold's confidence in the geological models while also providing the potential to add mineral resources and extend the life of underground mining at Stawell. We look forward to providing further updates to our mineral resources and reserves by the end of the first quarter of 2015."

Key Intercepts and Results Reported Include:

Federal-Albion South Target

The Federal-Albion South target area is comprised of two main lodes, the Extended and Central lodes, located in the upper levels of the mine approximately 180m to 325m below the surface. The target area is readily accessed from existing development and there is historical mining above, below and to the north of the target area. Drill results from the 2014 drill program, below, for the Federal-Albion South are important as they demonstrate high gold grades on two moderately west-dipping lode structures. The intercept grades are higher than those currently being mined and the estimated true widths, although variable, at times far exceed the widths required for mining.

Extended Lode

  • 15.75(1) g/t Au over 2.70m (ETW 1.50m) in hole MD6290A
  • 8.16 g/t Au over 7.70m (ETW 2.40m) in hole MD6296
  • 7.76 g/t Au over 6.00m (ETW 2.50m) in hole MD6295
  • 5.32 g/t Au over 11.40m (ETW 3.20m) in hole MD6297

Central Lode

  • 6.72 g/t Au over 5.00m (ETW 4.50m) in hole MD6294
  • 5.66 g/t Au over 9.20m (ETW 7.60m) in hole MD6285
  • 3.92 g/t Au over 10.70m (ETW 6.80m) in hole MD6284

U1 Target

The U1 target is located in the mid-levels of the Stawell mine, between the 615m and 705m levels below the surface of the Stawell mine where underground mining has occurred previously and also down-plunge to the north. The U1 target is comprised of four steep west-dipping lodes and drilling in 2014 has returned high-grade gold drill intercepts for three of the lodes, as highlighted below. The high-grade intercepts for the Dukes, Stockworks #1 and Central lodes are higher than current mining grades. These high-grades and the moderate drill intercept widths of Stockworks #2 lode will be important during mineral resource estimation and reserve studies.

Dukes Lode

  • 9.29(1) g/t Au over 2.40m (ETW 1.70m) in hole MD6273
  • 7.01 g/t Au over 2.85m (ETW 1.80m) in hole MD6277
  • 4.26 g/t Au over 5.55m (ETW 3.50m) in hole MD6275

Stockworks #1 Lode

  • 9.00 g/t Au over 7.55m (ETW 7.1m) in hole MD6275
  • 5.97(1) g/t Au over 15.10m (ETW 10.5m) in hole MD6277
  • 5.79 g/t Au over 6.60m (ETW 4.40m) in hole MD6276

Stockworks #2 Lode

  • 3.71 g/t Au over 5.40m (ETW 4.5m) in hole MD6280
  • 2.96(1) g/t Au over 13.55m (ETW 7.3m) in hole MD6279

Central Lode

  • 5.74 g/t Au over 3.75m (ETW 1.80m) in hole MD6281
  • 7.56 g/t Au over 1.20m (ETW 0.80m) in hole MD6280

Mariners Target

The Mariners target is located between the 250m to 460m level, below surface, in the upper part of the Stawell mine. The target is comprised of five moderately east dipping parallel-lodes extending northwards down-plunge from the Mariners mined area. The 2014 drilling identified the continuity of generally low-grade gold mineralization in the target area. However, of importance is an "end of hole" high-grade drill intercept, which tests above the Mariners target structures.

Quartz vein Lode

  • 13.15(2) g/t Au over 0.40m (ETW 0.30m) in hole MD6300

1) Visible gold present in drill intercept, 2) End of hole drill intercept, ETW - Estimated true width

2014 Stawell Underground Drilling Program

The Company's 2014 underground drilling campaign at Stawell Gold Mine has focused on three areas; Federal-Albion South, U1 and Mariners, all within the upper parts of the underground mine. All three areas occur above the South Fault, within the Magdala mineralized system, where extensive underground mining has occurred in the past and where current mining is in progress. Drilling at Federal-Albion South and U1 target areas has located significant basalt flank mineralization and quartz lode (Central lode) style gold mineralization. Both styles of mineralization are traditionally mined in the Magdala system. Drilling at Mariners intersected gold mineralization associated with five parallel quartz shears (Figures 1 and 2). Importantly, one hole in the Mariners program also located high-grade quartz vein lode mineralization above the Mariners target structures.

Federal-Albion South Target

The Federal-Albion South target is located in the upper southern part of the Magdala mineralized System where a large area of basalt flank, measuring 300m in strike and in 150m dip extent, remains unmined (Figures 2, 3 & 4). Geological interpretation for the area supports sub-vertical Central lode and basalt contact lode (Extended lode) gold mineralization targets, which in the south portion are sub-parallel to one another.

In 2014, a program of 15 diamond holes for 2,267m was successfully completed at the Federal-Albion South target, immediately south of historical underground mining. Initial holes in the program confirmed the presence of gold mineralization and further drilling reducing drill spacing to approximately 40m to support mineral resource studies (Figures 3 & 4).

The drilling has returned significant assay results for the Federal-Albion Central and Extended lodes as highlighted above and reported in full in Table 1.

The area south of the 2014 Federal-Albion South drilling is under-explored and is considered to have excellent exploration potential above the South Fault. The 2014 Federal Albion drill results will be included in the end of 2014 Stawell Mineral Resource update.

U1 Target

The U1 target comprises four steep west-dipping mineralized structures, namely the Dukes Basalt Contact, Stockworks #1, Stockworks #2 and Central lodes, which are bounded by the South Fault and Upper South Fault. The target area has an approximate 200m strike by 100m vertical dimensions, is partially supported by historical drill intercepts and abuts historical (2003) mine workings to the north. See Figures 2 and 5.

Drilling in 2014 at the U1 Target included 11 holes for total of 1,093m, with most holes drilled at the southern portion of the area, where drill data was sparse. The exploration program was undertaken to increase geological confidence in the area and to extend drill coverage further south.

The U1 target drilling has resulted in significant drill intercepts for all four lode structures as highlighted above, included in Table 1 and those for the Central lode are displayed on Figure 5. The drill results provide confirmation of gold mineralization extending southwards in the U1 area and will be used for updating the Mineral Resource and Reserve in the area.

Mariners Target

The upper part of the Mariners area has a five-parallel lode system that was mined in 2013 and 2014 (Figure 6). The lodes dip moderately east and are bound by the Scotchmans Fault and Upper Scotchmans Splay, which diverge to the north. This divergence of the structures has the effect of increasing lode dip length and the increased potential for mineralization northwards.

The Mariners target has approximate dimensions of 300m by 100m, is down-plunge from the mined portion of Mariners and is not drill tested to the north. The target has five-parallel east dipping lodes, with the Opportunity Lode being the widest (Figure 6).

In 2014, Mariners target drilling covered an approximate 180m down-plunge extent to the north of the Mariners mining area. The drilling has provided narrow low to moderate grade drill intercepts. However, one drill hole ended in high-grade gold mineralization above the Upper Scotchmans Splay. This intercept is 13.15 g/t Au over 0.40m (ETW 0.30m) in hole MD6300 and there is potential for additional mineralization beyond the end of the hole. The hole was unfortunately stopped in strong mineralization due to difficulties in continuing the drill hole.

About Stawell Gold Mines ("Stawell")

Stawell Gold Mines commenced commercial production from the Magdala Underground mine in 1984; mining has been continuous since this date and up to the end of December 2014 has produced 2,275,102 ounces of gold. Processing facilities at Stawell comprise crushing, grinding and sulphide flotation followed by a standard Carbon-In-Leach gold recovery circuit. Coarse gold is up to 30% of mill feed and is recovered using gravity concentrators. The mill is capable of processing approximately 850,000 tonnes of ore annually.

Qualified Persons

Mark Edwards, MAusIMM(CP), General Manager Exploration and Business Development and Simon Hitchman, FAusIMM, Exploration Manager of Crocodile Gold Corp and Justine Tracey, MAusIMM(CP), Senior Resource and Project Geologist of Stawell Gold Mines, are "qualified persons" as such term is defined in National Instrument 43-101 and have reviewed and approved the technical information and data included in this news release. Messrs. Edwards, Hitchman and Tracey have verified the data contained in this news release by reviewing all available data. No limitations were imposed on the qualified persons' review.


Crocodile Gold has in place quality-control systems to ensure best practice in drilling, sampling and analysis of drill core. All diamond drill hole collars (Table 2) are accurately surveyed using a Leica Total Stations instrument and down hole deviations are measured by electronic multi-shot cameras.

All reported drill results are from NQ2 sized diamond drill core that was sampled whole. Drill core sample intervals are determined using logged geological controls, vary between 0.2 and 1.5m in length and samples were assayed by ALS Laboratory Group at Orange, NSW. Assay results are based on 30-gram charge fire assays.

Mean grades are calculated using a variable lower cut-off grade (generally 2 g/t Au) and maximum 2 meter internal dilution. All intercepts have both down-hole intervals and estimated true widths. No upper gold grade cut-off is applied to the data. However, during mineral resource work the requirement for assay top cutting will be assessed. Drill intercepts containing visible gold are annotated in Table 1.

About Crocodile Gold

Crocodile Gold is a Canadian-listed gold mining and exploration company with three operating mines in Australia. The objective of Crocodile Gold is to continue to focus on the safe and profitable operating performance from its three operating mines, Fosterville and Stawell Gold Mines in the state of Victoria and Cosmo Gold Mine in the Northern Territory. Our primary goal of sustainable operating performance is achieved through building confidence in our mine plans, continuing with prudent cost management controls and targeted exploration and resource development. Sustainable operating performance from our current assets is a critical step in supporting the future growth toward the 5 year Strategy of Crocodile Gold.

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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.

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To view Figures 1 to 6, please visit the following link:

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