Crocodile Gold Corp.

Crocodile Gold Corp.

May 17, 2011 07:30 ET

Crocodile Gold Announces Appointment of New President and CEO and Update on Organizational Changes

TORONTO, ONTARIO--(Marketwire - May 17, 2011) -Crocodile Gold Corp. (TSX:CRK)(OTCQX:CROCF)(FRANKFURT:XGC) ("Crocodile Gold" or the "Company") is pleased to announce the appointment of Chantal Lavoie as President and CEO of Crocodile Gold effective June 17, 2011.

Mr.Lavoie is a Professional Mining Engineer with extensive experience in mining operations and projects. Mr. Lavoie has spent the last eight years at De Beers Canada Inc. ("De Beers") where he was responsible for the Canadian operations of De Beers including Snap Lake and Victor mines, the Gahcho Kue project and was acting CEO of De Beers. Mr. Lavoie has also worked for Barrick Gold Corporation at Goldstrike in Nevada and Aur Resources Inc. at the former Louvicourt mine.

The executive management team of Crocodile Gold now includes the following key personnel following recent additions:

Chantal Lavoie – Incoming President and CEO – formerly of De Beers and Barrick Gold Corporation
David Keough – Chief Operating Officer – formerly of Goldcorp Inc.
Stephen Woodhead – Chief Financial Officer – formerly of Desert Sun Mining Corp.
Bill Nielsen – Vice President, Exploration – formerly of Nevsun Resources Inc.
Colinda Parent – Vice President,Business Development – formerly of Northland Capital Partners Inc.
Joe Ranford – General Manager Operations – formerly of Mount Gibson Iron and Goldcorp Inc.

Stan Bharti, Chairman of Crocodile Gold commented, "We are very pleased that Chantal has agreed to join Crocodile Gold as President and CEO. His extensive mine operating experience will be an asset as we expand production in the near term through the development of Cosmo and aggressively explore our tenements to develop further expansion opportunities. Our solid operating team, led by David Keough our Chief Operating Officer, and our recent appointment of Stephen Woodhead as Chief Financial Officer, Bill Nielsen as Vice President, Exploration and Colinda Parent as Vice President, Business Development have significantly strengthened the depth of our management team and positioned Crocodile Gold for future success. We would also like to express our gratitude to Mike Hoffman for his contribution to Crocodile Gold's development from a private company to a producer over the last few years and for his commitment to assist in the transition."

David Keough, the Chief Operating Officer of Crocodile Gold commented; "We welcome Chantal to the Crocodile Gold team and look forward to working with him. With the end of the wet season in mid-April, production and mill throughput has returned to normal. We continue to take steps to optimize safety, costs and overall production and continue to look at all opportunities to optimize the operations. We have also increased the capacity of the operational management team to extract maximum value from our assets."

The flagship asset of Crocodile Gold is the Cosmo underground project which is currently being developed, with production expected in the 4th quarter of 2011. Due to the strategic importance of Cosmo, a Cosmo mine optimization study is underway and a dedicated project team has been appointed. Highlights of these actions include the following:

  • A detailed optimization study of the Cosmo underground mine is well underway led by Mr. Jim Simpson (formerly of New Gold Inc. and Goldcorp Inc.) with expected completion in July 2011. The priority is to plan for long term stable production, identify and mitigate any potential risk areas and ensure that the infrastructure has been designed for future potential expansion. A number of leading consultants in geology, mining, geotechnical, ventilation and metallurgy have been engaged to review all previous work, and where possible, improve the existing design and identify new opportunities.
  • The importance of this optimization of the Cosmo design has included the formation of a Cosmo Design Steering Committee made up of site management, the study leader Jim Simpson and board members. The Steering Committee is headed by Mr. Peter Tagliamonte, a Crocodile Gold board member and experienced mine operator.
  • Study findings to date include the awareness of ore structural controls which will assist in predicting expected geotechnical conditions. In addition, modifications have been undertaken to the mining method to ensure a more conservative approach in the first year of production and the infrastructure design has been modified to facilitate ease of material handling, ventilation and pumping.
  • The new dedicated operational management team at Cosmo is led by Mr. Joe Ranford, who has extensive underground mine operational experience. Terry Carr, the Cosmo Underground Mine Manager with his dedicated staff of mine engineers and Craig Pridmore, Geology Manager, are leading the team of underground mine geologists who will supervise the activities of the mine contractor on behalf of Crocodile Gold.
  • The new underground contractor at the Cosmo underground, Leighton Mining, is making excellent progress on the development at Cosmo with the first crosscut to the ore reached at 1035 Level (see Figure 2).

A current focus of the operation is the resumption of exploration diamond drilling. With the recent appointment of Bill Nielsen as Vice President, Exploration, a detailed and intensive exploration program has been formulated for the remainder of the year.

Bill Nielsen, Vice President, Exploration commented, "During the last few months assisted by our General Manager, Exploration, Mark Edwards, we have reviewed our tenement position to put together a detailed exploration program which will meet our strategic objectives to increase the mineral reserves to over 1 million ounces and our mineral resources to over 6.5 million ounces. We have increased the initial budget from $5 million to $11 million. We have a number of drills (both surface and underground) currently on site and expect further drills in the coming weeks."

Highlights of the exploration program include the following:

  • One of the major priorities will be the continued drilling at Cosmo. The priority on the drilling of the Eastern Lodes, where the majority of the resources and reserves are located, will concentrate on extensions to the existing orebody and upgrading of the existing resource to higher confidence levels. In the opinion of Crocodile geologists, the Western Lodes have excellent potential for significant increases to the resource and the establishment of a significant reserve. The initial focus will be on near surface extensions to the orebody to the south of the existing resource and extensions to depth including further drilling near CP-009W1 (see Press Release dated September, 28, 2010). The majority of drilling will be conducted from underground but there will be some drilling of the Western Lodes from surface.
  • Current drilling activities are concentrated on extensions to known mineralization at Crosscourse, Prospect and Lady Alice in the Union Reef area located immediately adjacent to the 2.4 million tonne/year capacity Union Reef Mill. The potential of defining a "Cosmo" scale orebody (tonnes and grade) by further drilling of the downplunge extension of the Crosscourse orebody, where there has been over 700,000 ounces of historical production, is excellent. Existing intersections downplunge of the open pit include 36 meters of 4.10 gram/tonne and 19 meters of 10.62 gram/tonne gold. Further to the press releases of April 14, 2011 and February 22, 2011, outlining the potential of a narrow high grade potential underground deposit at the Prospect deposit, further drill results are expected in the coming months, which could see sufficient confidence in the existing resource to develop an underground ramp from the historic Prospect pit to conduct further exploration and test mining from underground.
  • A detailed review of the area surrounding the polymetallic Iron Blow deposit (Inferred resource of 3,175,000 tonnes of 2.1 gpt Au, 100.9 gpt Ag, 0.75% Pb, 3.28% Zn and 0.19% Cu), located near the Princess Louise/North Point gold trend, has shown the potential for further resource expansion at Iron Blow. In addition, further drilling of the historic resource at Mt. Bonnie could see the establishment of a National Instrument 43-101 ("NI 43-101") mineral resource at this deposit. In order to further explore the potential prospectivity of the immediate area and to assist in optimizing future drill targeting, an airborne geophysical survey of the area will be conducted in June and July 2011. In addition to targeting base metals, a primary target will be the targeting of enriched gold/silver oxide caps over potential base metal deposits.
  • Additional airborne geophysical surveys will be flown over both the south and north end of the 25 kilometer long Cosmo/Howley trend and to the north section of the Burnside area. In total, over 3,700 line kilometers of airborne geophysical survey will be completed.
  • Drilling will be conducted on existing resources at Howley/North Point/Princess Louise and also historical resources in the north end of the Howley Trend to potentially upgrade to NI 43-101 compliant resources and increase and upgrade existing resources.
  • Work will continue on integrating the large amount of historical exploration information into the Crocodile Gold geological database.

Key highlights of current activities at site include the following:

  • Since mid-April at the mine site in the Northern Territory, one of the worst wet seasons has ended and the dry season has begun. Throughput levels through the mill and mining operations quickly have returned to normal. The company had previously provided guidance that production in the 1st quarter 2011 would be 14,000 to 17,000 ounces of gold. (see Press Release dated February 28, 2011). Production in the first quarter was 14,680 ounces of gold. Cash costs will be reported in early June with the release of first quarter results.
  • Production is currently being provided from the Howley open pit and nearby Mottrams open pit, with production expected to shortly begin at North Point and Princess Louise open pits.

Mike Hoffman, the current President and CEO of Crocodile Gold has indicated to the Crocodile Gold Board that he would like to change his involvement to that of a director role moving forward and has agreed to assist in both the transition and investor relations activities through the remainder of 2011.

About Crocodile Gold

Crocodile Gold is a Canadian company with operating gold mines in the Northern Territory of Australia and a land position of over 2,700 km2. Crocodile Gold is currently mining from the Howley, Mottrams North Point and Princess Louise open pit mines. 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 National Instrument 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). The Company has an exploration program in place with a main focus on the Union Reefs Project and the Cosmo Howley Mineral corridor which covers a strike length of over 25 kilometres and includes other deposits such as Bons Rush and Bridge Creek.

Qualified Persons

David Keough, MAusIMM and Bill Nielsen, P. Geo of Crocodile Gold are each a "qualified person" as such term is defined in National Instrument 43-101 and have reviewed and confirmed 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 impact of the appointments on the Company, 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 release, please visit the following link:

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