Crocodile Gold Corp.

Crocodile Gold Corp.

September 08, 2011 07:00 ET

Crocodile Gold Intersects Significant High-Grade Mineralization at Union Reefs: 27 Grams/Tonne Gold Over 4.23 Meters at Prospect and 10 Grams/Tonne Gold Over 8.1 Meters at Crosscourse

TORONTO, ONTARIO--(Marketwire - Sept. 8, 2011) - Crocodile Gold Corp. (TSX:CRK)(OTCQX:CROCF)(FRANKFURT:XGC) ("Crocodile Gold" or the "Company") is pleased to announce continued high grade intersections from the exploration drilling program currently underway at its Union Reefs project.

Highlights of these drill results from Union Reefs include:

  • 27.0 g/t Au over 4.23 meters including 130.0 g/t Au over 0.6 meters at Prospect deposit
  • 10.16 g/t Au over 8.1 meters including 13.9 g/t Au over 4.7 meters at Crosscourse deposit

Bill Nielsen, Vice President Exploration, commented, "The recent high-grade drill results from both the Prospect and Crosscourse deposits is consistent with previous drilling and they will add to the overall grade and size of these two proximal mineralized zones. URNDD26 at Prospect is almost 50 meters below the current NI43-101 resource and establishes continuity to depth and URNDD01 is 75 meters below previous drilling and the bottom of the old Crosscourse pit. Their relatively shallow depths and easy access to the nearby Union Reefs mill is of strategic importance. We will continue to rigorously explore these areas in an effort to significantly increase resources and reserves that can ultimately be mined in the near term."

David Keough, Chief Operating Officer, reviewed the results and commented: "These wide and high grade ore zones can be quickly accessed from an exploration/development decline from near the base of the existing historical open pits possibly in 2012, speeding up the potential development timeframes. It is noted that these two ore zones with their close proximity to the Union Reefs Mill on active mining leases have the potential to bring higher grade ore in the short to medium term with minimal investment, supporting our growth strategy".

Crocodile Gold currently has two diamond rigs drilling at Union Reefs where an additional minimum of 3,500 meters is planned to be drilled by year end. The overall objective is to define resources for subsequent underground mining that would provide the Company with a very low cost, high grade operation center. The Prospect and Crosscourse deposits are all located within the Union Reefs mill site, less than 1,200 meters from the primary crusher and could be accessed from a single underground entry point, (see Figure 2), from the base of one of the existing historical pits as early as 2012.

Table 1
Hole_ID Location Local Grid Depth From To Width True Width Grade
East North RL (m) (m) (m) (m) (m) (g/t Au)
URNDD26 Prospect 4927 7510 1200 258 182.27 186.5 4.23 2.96 27.0
Incl. 182.27 182.54 0.27 0.19 67.9
Incl. 183.8 184.4 0.6 0.42 130.0
incl 186.2 186.5 0.3 0.21 42.1
URNDD01 Cross-
5194 6680 1189 540 218.75 220.0 1.75 1.40 3.59
and 224.9 225.35 0.45 0.36 32.4
and 237.8 239.4 1.60 1.28 1.97
and 262.18 268.0 5.82 4.66 1.73
and 284.5 284.9 0.50 0.40 11.9
and 342.3 343.1 0.80 0.64 18.06
and 393.6 401.7 8.10 6.48 10.16
Incl. 397.0 401.7 4.70 3.76 13.90
and 434.5 438.0 3.50 2.80 2.32

Numerous short sections of visible gold mineralization were seen throughout a significant core length beneath the Crosscourse pit. The entire 283.35 meter length from 218.75 to 502.1 meters returned an average assay of 0.66 g/t Au.

Figure 2 shows the diamond drilling to date and the new drill results being released today. The exploration team is currently working on designing the next phase of drilling for Prospect after these successful results. Following completion of the drilling program, reserve and resource estimates will be updated, as well as a desktop study for an underground exploration program in 2012.

An historic resource calculation for the mineralization under the Prospect pit indicated 144,000 tonnes grading 11.7 g/t Au* to a depth of approximately 30 metres below the pit bottom (Figure 3, Figure 4).

Drilling by past operators under the Crosscourse pit targeted the high-grade mineralization identified as the E-Lens (Figure 5). Drill intercepts from past operators on the E-lens below the pit bottom include: 11 metres @ 6.60 g/t Au, 36 metres @ 4.10 g/t Au and 16 metres @ 6.00 g/t Au. An historic resource for the Crosscourse E-Lens indicated 150,000 tonnes grading 4.3 g/t Au*.

Past production from the Crosscourse pit amounted to 13,036,535 tonnes averaging 1.7 g/t Au producing over 700,000 ounces of gold. Approximately 83% of the gold from the Union Reefs open pits came from the Crosscourse pit. Past production from the Prospect Deposit amounted to 411,994 tonnes grading 1.6g/t Au to produce 21,242 ounces of gold.

*Historical estimates derived from the internal report titled "Mine Closure Report, Union Reefs Gold Mine (Pine Creek)" prepared by Crosby, Q., Makar, B., Chen Chow, K., Sheehan, E., Davis, G., December 12, 2006. This report was not prepared in accordance with currently accepted guidelines for the preparation of Mineral Resources and Mineral Reserves, and does not comply with National Instrument 43-101 ("NI 43-101") and are not considered by Crocodile Gold, as current mineral resources or mineral reserves. These resource estimates may have also been depleted by past mining, and although possibly demonstrative of the potential grade of the deposits, the historical estimates of tonnage and grade are not considered indicative of the remnant potential resource. A qualified person, as such term is defined under NI 43-101, has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves. Crocodile Gold is not treating the historical estimate as current mineral resources or mineral reserves and the historical estimate should not be relied upon.

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. The Company 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 Annual Information Form dated March 31, 2010 and Crocodile Gold press releases dated September 8, 2009 and January 25, 2010). 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, Maud Creek Deposit and the Union Reef project area.

For additional information, please visit our website Follow us on Twitter (@crocgold_crk) or Facebook (Crocodile Gold Corporation).

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 approved the technical information and data included in this press release.

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 HQ half-core.
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 1.0m interval, 0.5 g/t lower cut-off and maximum 3m internal dilution. No upper cut has been applied.
6. All intersections are down-hole intervals.
7. All deviations have been verified by down hold camera.
8. QA/QC for these holes has been checked and verified through blind standards, field duplicates, lab repeats and barren flushes. QA/QC 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.

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