Thursday, August 26, 2010

STRONG INCREASE IN CRACOW MINERAL RESOURCE BOOSTS CATALPA INVENTORY

 

Catalpa Resources Limited (ASX:CAH) the growing Australian gold producer, today  announced a 21%  increase in the Mineral Resource at the Cracow Gold Project with the addition of 178 000 ounces of gold, bringing the updated Mineral Resource to 1.02 million ounces.

 

Catalpa has a 30% interest in the Cracow Gold Mine which is an unincorporated joint venture with Newcrest Mining Limited (70%), the projects operator.

 

Catalpa Managing Director, Bruce McFadzean commented “the increase is after mining depletion for the past year, and brings Catalpa’s combined Mineral Resource, including the Company’s 100% owned Edna May Gold Project to 1.98 million ounces.”

 

“The variance is largely due to the addition of Phoenix into resource, and resource additions at Tipperary, Kilkenny and Roses Pride. In addition, the cut-off grade has been reduced to 2.8g/t Au to reflect the marginal cut-off grade based on a gold price assumption of US$800 per ounce and an exchange rate of AUD/USD 0.75 (A$ gold price $1,067 per ounce).”

 

“Importantly, the Cracow Ore Reserve between June 2009 and June 2010 was maintained at 230 000 ounces of gold which was sufficient to replace mining depletion and reinforces our confidence in the sustainability of this quality gold asset.”

 

The Cracow Ore Reserve has been reported above a cut-off grade of 2.9g/t Au, which is the marginal grade cut-off grade covering all operating costs excluding mining fixed costs, and is based on a gold price assumption of US$750 per ounce and an exchange rate of AUD/USD 0.75 (A$ gold price $1,000 per ounce).

 

As announced in the 30 June Quarterly Report, Cracow’s gold production of 102,759 ounces exceeded the FY2010 budget projections.

 

“We see a healthy outlook for the gold sector and remain optimistic about the potential of further exploration upside at both our Cracow and Edna May Gold Projects. 

 

“In May this year we announced an increase in the Edna May Ore Reserve to more than one million ounces.”

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