Glass Earth Gold Limited
TSX VENTURE : GEL

Glass Earth Gold Limited

May 24, 2011 10:17 ET

Glass Earth Gold Limited: Financial Statements and Management's Discussion & Analysis for the First Quarter Ended 31 March 2011

WELLINGTON, NEW ZEALAND--(Marketwire - May 24, 2011) - Glass Earth Gold Limited (TSX VENTURE:GEL)(NZAX:GEL) ("Glass Earth" or the "Company") announced today that it has filed its March 31, 2011 first quarter Financial Statements and associated Management's Discussion and Analysis ("MD&A") report pertaining to that period with regulatory authorities.

Glass Earth Gold's determination to create revenue from its placer operations, to support its objectives as a hard-rock gold explorer in New Zealand, is demonstrated in a significantly lower loss for the quarter ($61,000 vs $193,000 in 2010) principally due to increased revenue from placer mining operations. Placer mining expansion in 2011 should see a significant increase in both gross and net revenue. The Company's cash position as at March 31, 2011 was $3,801,000.

This positions the Company well as it continues to report encouraging results from its WKP WEST gold prospect in the Hauraki Region (reported May 12, 2011).

Glass Earth is a gold exploration company and therefore classified as being at the 'development stage', as it currently has modest mining income. With all general and administration expenses being expensed, Glass Earth records losses each quarter/year arising from the expensing of these cash operating costs as well as other non-cash expense items.

3 months ended March 31 20113 months ended March 31 2010
Revenue251,000100,000
Cost of revenue(122,000)(94,000)
Gross profit129,0006,000
Cash operating costs
General & admin203,000206,000
Finance costs (gain)(13,000)(7,000)
190,000199,000
Non-Cash expenses
Write down Mineral Properties--
Stock based compensation--
Income tax expense/(benefit) - deferred--
Net loss for the period61,000193,000

Operational Activities

Field operations concentrated on the testing of Glass Earth's two most advanced prospects WKP West (65% Newmont Mining / 35% GEG; Newmont managed) and Muirs Reefs (100% GEG) in the North Island, and drilling of the Serpentine prospect in the South Island. Encouraging assay results for drill hole WKP 27 were released May 12, 2011 with assay results awaited in respect of WKP 28 and two further drill holes into Serpentine.

In addition, metallurgical testing and test plant design on the Ophir Project (50% GEG/50% Ophir Gold) is nearing completion.

Expansion of alluvial/placer gold mining in the Central Otago region is a strong focus as current mining operations bed down.

About Glass Earth Gold Limited

Glass Earth is one of the largest New Zealand-based gold exploration companies exploring a land position of approximately 10,000 square kilometres in the North and South Islands.

In the NorthIsland, exploration efforts are focused on large epithermal gold systems in the Hauraki/Central Volcanic Region. This Region is host to the 10 million ounce Martha Gold Mine, (Newmont Mining).

Hauraki Region – Glass Earth occupies a significant ground position around Newmont's currently active Waihi gold operations; The Newmont-Glass Earth Waihi West JV (Newmont earning 60%) and Hauraki JV (North and Central Areas - 65/35) are currently being explored and managed by Newmont. Exploration at the WKP gold prospect is ongoing following the very encouraging 2010 drilling results on that prospect.

Central Volcanic Region – Glass Earth has defined several significant epithermal gold targets in this region including the Muirs Reef project (Mamaku district).

In the South Island, exploration efforts are focused on the Otago Region for mesothermal "Macraes-style" gold targets and alluvial gold.

Otago Region – Field programmes to support the drilling of highly ranked Game Hen gold target is underway.

Two alluvial mining operations continue into the 2011 year, coupled with an acceleration of alluvial exploration and resource definition; Glass Earth / Dunstan Mining (placer mining 50/50 partner) anticipate a significant increase in gold output in 2011.

To receive Company news via email, contact jennie@chfir.comand mention "Glass Earth news" in the subject line.

GLASS EARTH GOLD LIMITED
For the three months ended March 31, 2011
QUARTERLY OVERVIEW
  • Exploration –WKP gold prospect in Hauraki, New Zealand (Glass Earth 35%) – Follow-up drilling of the encouraging results from the 2010 diamond drilling at WKP West was completed. The first of the 2 holes (WKP 27) intersected 1.4m @ 30.7 g/t Au and 77.7 g/t Ag within an extended intersection of 152.4m @ 1.16 g/t Au. Assay results of WKP 28 are awaited.

  • Ophir gold prospect in Otago, New Zealand (Glass Earth 50%) – Additional work is being undertaken as a pre-requisite to a formal proposal for capex and mining for the consideration of the Joint Venture.

  • Mining Operations - cash contribution from the Company's placer mining operation (including the lease of a Gold Recovery Unit) totaled $129,000 for the three months ended March 31, 2011 (March 31, 2010 - $6,000).

  • Financial results - The net loss for the three months ended March 31, 2011 was $61,000 (March 31, 2010 - $193,000).

    The Company's cash position as at March 31, 2011 was $3,801,000.

Near Term Outlook

- WKP West – WKP 28 drilling assay awaited; analysis and interpretation to underpin future exploration initiatives including additional step-out drilling.

- Muirs – 5 hole diamond/RC drilling program completed in Q1. Further trenching over the recently detected high surface gold values (up to 17 gm/t Au in situ rock chips) has commenced in April 2011 prior to recommended further drilling.

- Serpentine – 2 diamond drill holes completed; assays awaited.

- Ophir – Mining decision pending.

- Placer production – Replacement placer mine successfully in production since December 2010. Resource definition on several other prospects is underway. Third gold recovery unit being built.

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Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) nor New Zealand Exchange Limited has reviewed this release and neither accepts responsibility for the adequacy or accuracy of this release.

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