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Letter to the Shareholders of
Romarco Minerals Inc.
September 16, 2008
To The
Shareholders of Romarco:
I am writing
to you with an update of our activities and to inform you of events and news
on the horizon.
As you know,
we closed the acquisition of the Haile Gold Mine from Kinross Gold in October
of 2007. We immediately began compiling the historic drill data into a
three-dimensional model and outlined a drilling program to confirm the
historic resource which Amax identified in the early 1990�s. The
historic resource was never taken to production due to the low gold price
environment that occurred in the mid and late 1990�s. The database we
assembled and the results from our initial drill program were so spectacular
and far better than anything previously reported that our technical team was
convinced we were looking at a district scale multi-million ounce gold
deposit. In March, we acquired a second core drill rig to conduct
an aggressive exploration program. Each hole has produced outstanding
results (see website) with grades indicating economic open pit
potential.
To date, the
Company has drilled more than 25,000 feet of core drilling and recently
announced a 92% increase to the measured and indicated resources to 1.5
million ounces of gold (see website for table and details). In
addition, there is 678,000 ounces of inferred resource bringing the total
resource at Haile to 2.1 million ounces of gold as of September 2008.
With this significant increase in gold resources, the Company has increased
the size of its proposed operating plant from a 4,000 ton per day operation
to a 7,000 ton per day operation.
The Company
will continue this aggressive exploration program for the next 12 months and perhaps
beyond. The deposit is open in three directions (north, east and
west). We are continuing to step out with each drill hole and have
still not found the limits of the deposit. We have yet to test the
property for gold at depth (more than 700 feet or 215 meters). We have
plans to drill some deeper holes before the end of the year. Exploration
drilling will continue and the resources will be updated periodically
throughout the year. We believe at this time, Haile will produce a
positive feasibility study this Fall and become a gold producing mine and we
are proceeding forward with that plan. We are in the last stages
of completing the feasibility study which is being completed by a world-class
engineering team comprised of five companies. The report should
be ready for publication by October 2008.
The Haile
Gold Mine will be one of only a handful of mines coming into production in
the United States within the next 2 years. We have been completing some
of the required steps for the permitting process and have tremendous local
support from the community and local officials for the development of the
mine. The mine will provide significant economic benefits and much
needed employment to the local community which has been depressed since the
major textile mills closed down in the area over the past decade. The
land is private land, so permits will come through the state and local
agencies.
The NI-43-101
report filed on SEDAR and prepared by Behre Dolbear in late 2007 bears little
resemblance to what we have learned and know today at Haile. The report
was based on the historic information and work conducted by AMAX Gold.
Our team, our engineering contractors and our drilling results show a much
different picture about the potential of this property. Our information
is checked and double-checked to ensure we are delivering accurate
information to the market. The 43-101 report will be updated within the
next month.
We now have a
team of 17 employees at Haile performing duties in the area of geology,
drilling, engineering, permitting and administration. This team is
dedicated to growing the resource, completing the permitting process and
preparing for construction and development. Our Chief Geologist, James
Berry, came to Romarco from Barrick�s Ruby Hill Mine. His skills and
experience have been invaluable in guiding our exploration program,
digitizing the resource database and conducting mine modeling.
Additionally our Sr. Geologist, Tom Kilbey is working with Mr. Berry to
assess the district potential of Haile and guide our step out and deep
drilling programs. Mr. Kilbey is credited with one of the more recent
discoveries at Haile and was Project Geologist for the Haile Mine in the
1980�s and early 1990�s.
The Pinos
Gold District in Mexico is another significant project and we will begin our
second drill program in early September 2008. The Pinos Gold District
is a high-grade gold vein district with significant historic production from
the surface to 100 meters. We are targeting the continuation of that
mineralization below 100 meters.
We have two
exploration projects in Nevada and are reviewing our plans for the upcoming
field season.
We are
confident that current share price and does not accurately reflects the value
of our projects. However, as many of you are aware, the gold market is
plagued by many other economic and market conditions other than gold.
We anticipate that with the new resource and feasibility coming out soon our
share price will begin to reflect the value of our underlying assets.
We continue
to have a significant shareholding by institutional investors. Sun
Valley Gold is now nearing 40% ownership and US Global Investors (12%).
Other significant institutional shareholders include: Sprott Asset
Management, Rand Merchant Bank, Zurich Funds and Banks.
Stay tuned
with lots of news coming and don�t hesitate to contact me if you have any
questions. Thank you for your support � we are dedicated to creating
significant value for all of our shareholders. Myself or Shirene Urton
are available to answer any questions you may have. We can be reached
at 775-355-1900.
Yours very
truly,
ROMARCO
MINERALS INC.
�Diane R. Garrett�
Diane R. Garrett
President and CEO
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