Crocodile Gold Announces Agreement on the Sale of Non-Core Assets in the Northern Territory
August 28, 2014 (Source: Marketwired) — Crocodile Gold Corp. (TSX:CRK)(TSX:CRK.DB)(TSX:CRK.WT)(OTCQX:CROCF)(FRANKFURT:XGC) (“Crocodile Gold” or the “Company”) has entered into a sale agreement with Phoenix Copper Limited (ASX:PNX) (“Phoenix Copper”) to sell 100% of the Iron Blow and Mount Bonnie massive sulphide deposits (see Figure 1) for a 2% royalty in respect of any gold and silver production from the related tenements. Crocodile Gold will retain an option to buy back a 30% interest in the Iron Blow and Mount Bonnie properties within six months of Phoenix Copper completing a Feasibility Study, by paying three times the accumulated exploration expenditures on these tenements.
Crocodile Gold has also entered into an Option (Farm-In) agreement (the “Agreement”) with Phoenix Copper, which allows Phoenix Copper the ability to earn up to a 90% interest in the nearby Burnside, Moline (see Figure 1) and Maud Creek base metal and gold exploration projects (see Figure 2) through a commitment to spend a total of $4 million in exploration expenditures over the next four years. Under the Agreement, Crocodile Gold will retain the option to acquire 90% of any gold and silver deposit discoveries on any of the properties by paying Phoenix Copper three times the accumulated expenditure related to that deposit. This exploration agreement allows Phoenix Copper to explore for gold and base metals around the Maud Creek Mineral Resource while Crocodile Gold retains 100% ownership of the Maud Creek deposit and surrounding prospects on Mineral Licence ML30260 (Figure 2).
Mineral Licence ML30260 (previously MLN1978) is approximately 1,106 Ha in size and includes the Maud Creek Mineral Resource and Reserve. This deposit contains an Indicated Mineral Resource of 7.7 Mt @ 3.50 g/t Au for 871,000 ounces of gold and an Inferred Mineral Resource of 4.2 Mt @ 2.55 g/t Au for 343,600 ounces of gold (please see notes to Maud Creek Mineral Resource).
In addition, the Agreement provides for further consideration of $500,000 payable to Crocodile Gold (in cash or shares) in the event that Phoenix Copper completes a Bankable Feasibility Study on any base metals deposits.
The Agreement is subject to certain conditions including the parties entering into certain deeds of assignment and assumption with relevant third parties in relation to existing third party agreements. The conditions must be satisfied or waived on or before November 15th, 2014.
Update on Custom Milling (Toll Treatment) Agreement with Thor Mining PLC.
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Crocodile Gold is additionally announcing that it has withdrawn from the memorandum of understanding with Thor Mining PLC (“Thor”), originally signed April 10, 2013, to provide custom milling and processing of ore provided by Thor. Crocodile Gold will continue to pursue other custom milling opportunities with partners in the Northern Territory as part of its strategy to fully utilize its 2.4 million TPA mill at Union Reefs.
Notes to Maud Creek Mineral Resource
- The Mineral Reserve is as of December 31, 2012 and is reported in the document titled Report on the Mineral Resource & Mineral Reserves of the Maud Creek Gold Project.
- All Mineral Reserves have been estimated in accordance with the JORC code and have been reconciled to CIM standards as prescribed by the NI 43-101.
- Mineral Reserves were estimated using the following mining and economic factors:
- A 13% dilution factor and 110% recovery was applied to the caving under fill method
- A 5% dilution factor and 90% recovery was applied to sub level open stoping
- A gold price of AUD$1,450/oz
- An overall processing recovery of 88%
- The cut-off grade for Mineral Reserves has been estimated at 4 g/t Au.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimates of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio political, marketing, or other relevant issues.
The quantity and grade of reported inferred resources in the above estimations are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.
The Technical Report titled Report on the Mineral Resource & Mineral Reserves of the Maud Creek Gold Project, dated December 31, 2012 conforms to the CIM Definition Standards on Mineral Resources and Mineral Reserves referred to in NI 43-101. The qualified persons (each a “QP”) who supervised the preparation of Technical Reports are: Mark Edwards, MAusIMM (CP), General Manager of Exploration and Business Development for Crocodile Gold Corp. and Phil Bremner, FAusIMM, consultant from Mining One Pty of Melbourne, Victoria, Australia. Phil Bremner is independent of the issuer as defined by NI 43-101.
Mark Edwards, General Manager, Exploration and Business Development for Crocodile Gold 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.
About Crocodile Gold
Crocodile Gold is a Canadian gold mining and exploration company with three operating mines in Australia, in the State of Victoria and the Northern Territory. The Company has a combined land package in excess of 4,000 sq. km. The objective of Crocodile Gold is to continue production from its three operating mines, Cosmo, Fosterville, and Stawell, while also exploring and developing the Company’s resources to ensure sustainable production in the future.
For additional information, pleases visit our website www.crocgold.com or follow us on Twitter @crocgold_crk or on Facebook at CrocodileGoldCorp.
Forward Looking Information
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 completion of this transaction and mineral resource and mineral reserve statements, 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.
To view Figures 1 and 2, please visit the following link: http://media3.marketwire.com/docs/crk0828figures.pdf.
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