22 January 2009
CATALPA RESOURCES' 'MILESTONE
Resources (ASX:CAH), Perth-based
emerging gold producer recently released its December 2008 quarterly results,
outlining significant progress the Company has achieved during the period to
advance its Edna May Gold Project .
Bruce McFadzean cited the past quarter as a 'milestone' in the Company's
journey towards becoming Australia's
next gold producer.
"In the December
quarter we had a successful rights issue to raise $3.5 million before costs, to
finalise the Edna May Gold Project Feasibility Study and to fund our ongoing
exploration programmes and operations."
"The success of
the rights issue against the backdrop of an extremely challenging financial
environment reinforces the confidence in the Edna May Project and in the
increasingly bullish outlook for gold.
the Edna May Gold Project Feasibility Study during the quarter, which
demonstrates a robust project cash flow with a mine life of 6.3 years with an
average annual production rate of more than 100 000 oz of gold."
Feasibility Study excludes any additional underground mining potential further
supported from encouraging exploration results from our 2008 drill programme.
These results increase our confidence that deeper Edna May Gneiss targets
provide an increasingly positive outlook for potential underground mining in
of the funding, construction, and production phases ahead, Catalpa's management
team was considerably strengthened during recent months, with the addition of
Erik Palmbachs as Chief Financial Officer in October 2008, and Stuart Pether,
who joined us this month as General Manager Operations."
"The project offers shareholders and investors a cash flow within
twelve months combined with very attractive margins at today's gold prices.
Furthermore Catalpa believes there is significant project upside from planned
updates to the Reserve from the adjacent Greenfinch deposit where drilling is
scheduled to commence this week, and a review of existing surface stockpiles
"At today's gold
price, the project has very attractive average cash operating margin of more
than $50M per annum, which will underpin Company growth over the near
"The Edna May
Project will be constructed in a market of downward capital cost pressures, and
will be operated in a market of contained cost pressures.
"Our Reserve is
64% Proved category and contains over 130,000 metres of drilling of which
almost half is diamond core. The Ore Reserve is metallurgically simple and
commenced detailed discussions with banks and hope to finalise the funding
process and move the project into construction before the end of the current
financial year. We do not anticipate the funding task to be easy; however with
sound project economics, a margin protection strategy and an experienced
management team we understand that funding is achievable in the current
environment," Mr McFadzean said.
"At today's gold
price and Catalpa's current share price, we are a very sound investment."
For a full copy of
the Quarterly Activities Report to December 2008, please follow the link:
For further enquiries contact:
Warrick Hazeldine/Annette Ellis
Media and Investor Relations
Catalpa Resources Limited
Tel (08) 9321
Tel: (08) 9485 1254
Resources Limited (ASX: CAH) aims to become Australia's
next mid tier producer by developing its open pit assets, located on its
extensive and wholly-owned mining tenements in Western
Catalpa is on the
cusp of a new phase of development towards production at its Edna May Gold
Project, conveniently positioned a few kilometres from the infrastructure of
Westonia, an established town with a long mining history. The project is just
three hours or 300km by road from Perth; half way
between Perth and Kalgoorlie
and ideally situated to be serviced by both centres.
Notably, there have
been three previous successful mining programs which have occurred both above
and below the planned open pit at Edna May, which significantly reduces the
risk of Catalpa's project.
Catalpa has an
experienced and innovative Board and management team that is committed to
realising a timely production and cash flow profile from the development of the
Edna May open pit resources.
In preparation for
planned production at Edna May, the Company relocated its 2.8mtpa Big Bell mill
to site in 2007. The mill is being maintained 'ready for construction'
adjacent to the proposed plant construction site.
Catalpa is pursuing
parallel growth with a renewed exploration programme underway on its 880km? of
under-explored Westonia Greenstone Belt, and is reviewing other regional
opportunities for acquisition and/or joint venture. In particular, Catalpa
seeks to identify and develop new projects and/or acquisitions on its extensive
land holding or within the region, which is prospective for gold, nickel and
Catalpa has a sound
Resource base at Edna May with significant upside to grow Resources and
Reserves and move towards production. With a buoyant outlook for the gold
price, the Company's Board believes that Catalpa Resources presents a sound
investment opportunity with significant upside potential.
Catalpa Resources has
adopted best practice standards across all its operating activities, including
its social, health and safety, environmental management and corporate
Level 3, 28
Kings Park Road, WEST PERTH
Ph: 08 6314 6300 Fax: 08 6314 6355