RE: My questions - Chantal's answers Well at least the production guidance seems to be bang on. As I said in my previous post, I don't think a Management Team would be stupid enough to post a new presentation with such robust forecasts and such a short timeline unless they were looking to get the axe..........and then re-confirm that by email.
CRK has actually more than tripled the production from Q1. In addition, FGM and SGM didn't start counting production for CRK until May 4. If you take a look at the numbers below and my highlights, I think CRK should be able to produce 50k + oz's in the 3rd and 4th quarter of this year barring any reduction in grades. I will also look forward to some guidance on what ceasing operations at SGM will do to production after 2013, although I would figure cosmo would be up to full speed by then.
I would expect the higher production and grades has decreased cost per oz but I would not yet expect it to be at the forecasted $1000 - 1100 as we didn't have a full quarter with FGM and SGM. Things are IMO definitely looking better and when the official earnings report is released we will get more information. I still think this takes a year to fully pan out and be fully reflected in our SP.
ThyFish
TORONTO, ONTARIO--(Marketwire -07/12/12)- Crocodile Gold Corp. (CRK.TO)(CROCF)(XGC.F) ("Crocodile Gold" or the "Company") is pleased to announce it produced 36,117 ounces of gold in the second quarter of 2012 and 46,876 ounces year to date in the period ending June 30, 2012.
---------------------------------------------------------------------------- First Second Quarter Quarter YTD YTD 2012 2012(1) Production(1) Performance(2)----------------------------------------------------------------------------Ore Processed (t) 371,439 463,176 834,615 1,393,756----------------------------------------------------------------------------Average Grade (g/t Au) 0.99 2.83 2.01 2.51----------------------------------------------------------------------------Mill Recovery (%) 92.0% 87.4% 89.5% 86.6%----------------------------------------------------------------------------Gold oz Produced 10,759 36,117 46,876 94,770----------------------------------------------------------------------------Note 1 : Includes production from Fosterville and Stawell post May 4th acquisitionNote 2: Shown as reference and including Fosterville and Stawell production since January 1st 2012. YTD results through June 30, 2012.This table is compiled from unaudited production figures. Audited results can have slight variations and will be released as part of the Company's Quarterly Reporting.----------------------------------------------------------------------------
With the completion of the acquisition of the Fosterville ("FGM") and Stawell ("SGM") gold mines on May 4th, the Company significantly increased its gold production, more than tripling its production in the second quarter compared to the company's first quarter 2012 performance. For year over year comparison purposes, when the FGM and SGM mines are included as if they were owned by Crocodile on January 1, 2012, the Company's pro-forma gold production performance year to date through June 30, 2012 was approximately 95,000 ounces.
Commenting on these results, Chantal Lavoie, President and CEO of the Company said, "This year's second quarter has been transformational for our Company with the acquisition of the Fosterville and Stawell mines, the completion of the $75 million debt facility with Credit Suisse AG and the continued progress at our Cosmo project in the Northern Territory. At the operational level, best practices are already being shared and implemented and we have seen positive results at all the sites."
Operational Update-State of Victoria
-- The Company successfully completed the acquisition of the FGM and SGM gold mines acquisition on May 4th. Associated with the acquisition, the Company completed a $75 million debt facility with Credit Suisse AG.-- The operating teams of FGM and SGM have been fully integrated into Crocodile Gold and after a transitional period in May, both mines produced more ounces of gold in June than in any other month in 2012.-- The Company completed operational reviews and made the decision to transition the operation of SGM, which will see underground mining activities being completed by the end of 2013. The decision to cease mining activities at SGM after 2013 will result in significantly reduced capital expenditures at SGM starting in the fourth quarter of 2012 and continuing throughout 2013. This should result in material free cash flow generation from SGM in this period during which gold is being produced, but no development capital is being spent.
Operational Update-Northern Territory
-- At Cosmo, underground drilling continued and results to date confirm the ore zones are wider than expected in several locations. The wider ore zones should allow for simpler mining techniques, lower dilution and ultimately lower cost production which are all positive, long-term developments for Crocodile Gold.-- In the short-term, the wider ore zones require adjustments to the mining method and sequence. In conjunction with this, development rates have been lower than expected. Remedial plans have been developed with the main contractor, Leighton, and development rates in June reached all- time highs despite continuing labour shortages in the region.-- Trial mining in Zone A has been successful with lower than expected dilution and grades and metallurgical recoveries as per plan.-- The Company continued to progress on permitting the International open pit mine. This includes an amendment made to the project development sequence, in line with comments received from regulators. A production decision is still expected by the fourth quarter of 2012. The Company has not included any production from the International property in its 2012 guidance.-- The Company has successfully re-negotiated the ore haulage contract, which will see a significant reduction in associated costs over the next two years-- Surface mining activities at Rising Tide (Phase 1) were completed and the decision was taken to not proceed with the next phase nor with the remaining mining of the Princess Louise and North Point deposits, given lower than expected grade results and price escalation by the surface mining contractor.
Exploration and Advanced Projects - Update
-- The Company completed its Union Reefs drilling program with nearly 11,500 meters drilled. Results will be used to update the mineral resources and mineral reserves model in the third quarter. In June, permits required to initiate the excavation of an exploration decline were received. A decision regarding the next phase of the project will be taken later this year.-- In June, a review was completed by an independent consultant confirming the applicability of BIOX technology, which is currently being utilized at the Fosterville Mine, to the Maud Creek deposit, therefore providing a technical and economical solution for gold recovery.-- On May 16th 2012, the Company signed a binding agreement with Primary Minerals NL of Perth, Australia for the sale of the Mt. Bundy property in the Northern Territory. This agreement remains subject to various conditions subsequent that are expected to be satisfied by the end of 2012.
Additional details of the second quarter will be provided in the Management Discussion and Analysis report, which will be released in conjunction with the Company's financial statements in mid-August.