GOLD NEWS

New gold reserve and resource figures "Great news" for Catalpa

Catalpa's Edna May gold mine in Western Australia is on track with construction and new ore reserve and mineral resource calculations are very positive

Author: Lawrence Williams
Posted: Thursday , 03 Dec 2009

LONDON - 

Catalpa  Resources  (ASX:CAH),  which is redeveloping the Edna May gold property in Western Australia, has announced an updated mineral resource and ore reserve delivering a  further  16%  boost  to  gold Reserves,  and  a  13%  increase  in  the Mineral Resource.  Significantly, the reserve figure is now a fraction below the magic million ounces, while the total resource is put at over 1.66 million ounces, and with further drilling under way - in particular targeting the deeper mineralisation at the project - the likelihood is there will be further increases in resource - and also in the higher reserve category.

 The  latest revised mineral resource  and  ore  reserve  estimate  is  the  result  of several  significant  RC  and  diamond  drilling  programs  conducted  over  the last 6 months.  

Speaking to Mineweb at the Mines & Money conference in London, Managing Director Bruce McFadzean, a mining engineer with strong operational experience with major mining companies, was very enthusiastic about the progress so far on the property.  The company is already going ahead with plant construction which, McFadzean said, is now about 70% complete.

The actual figures announced by Catalpa are as follows: Total  Mineral  Resources  after  mining  depletion  are  estimated  at  1.66 million ounces of gold which  represents an  increase of 170,000 ounces of gold  (13%)  over  the previous estimate. The increase was driven by additions to Edna May Deposit  including  an  initial estimate of mineralisation within the Golden Point Gneiss and a reduction  in applied cut-off grade to 0.4 g/t Au to reflect the economic cut-off grade at A$1,250 per ounce (US$1164/ounce).

The  Mineral  Resource  has  only been  estimated  to  a  maximum  depth  of  300 metres  below  surface  which  is  an  equivalent  basis  to  previous  Mineral Resource estimates. 

McFadzean  said  the  Mineral  Resource excludes mineralisation defined from previous deep (+300 metre) diamond drilling programs. 

 "A  focus  for  Catalpa  in  2010  is  to  target  the  deeper mineralisation  in  an effort to move it towards a JORC compliant Mineral Resource in addition to advancing Golden  Point  and  drill  testing  regional  targets," McFadzean said in a press release.

 Total Ore Reserves after mining depletion are estimated at 954,000 ounces of  gold which  represents  an  increase  to  the  previous estimate of 134,000 ounces of gold (+16%), driven by conversion of inferred resource within the  Edna May Deposit and revised gold pricing assumptions. 

"This  is  great  news  for  Catalpa,  and  adds more  than  another  year  to  the Edna May Gold Projects life-of-mine." "Significantly, some 62% of the Ore Reserve is in the highest confidence (JORC) Proved category."

"The  gold  price  of  A$1,250  used  in  the  Ore  Reserve  estimate  reflects  a moderate  approach  to  the  current Australian  dollar  spot  price  and  excludes  the  further  price  benefit  Catalpa  receives  from  the  forward  sold position of 352,316 ounces at A$1,557 per ounce," McFadzean said.

The Edna May Gold Project remains within budget and schedule to produce first gold in June 2010.