Casablanca Mining announced financial results and other significant events for the quarter ended June 30th 2011.
Second Quarter Highlights:
1. 43-101 Technical Reports Completed For Casuto Project and Free Gold Project;
2. Completed Purchase of 70% Interest in New Gold Project consisting of Los Pinos 1-30 and Teresita 1-20;
3. Copper Sulfate Plant Construction Progresses On Time and Within Budget;
4. New Road and 15 Hole Drilling Project Completed at Anica Copper Mine
5. Electro Mining Patent Granted in China
Financial and Operations Overview:
Total assets grew from approximately USD 6.0 million at March 31st 2011 to almost USD 7.7 million at June 30th 2011. Net Loss per share increased from at June 30th 2010 to per share at June 30th 2011.
For the 3 and 6 months ended June 30th 2011, operating expenses were USD 363,393 and USD 610,990 respectively compared to USD 2,500 and USD 9,700 for the three and 6 months ended June 30th 2010. The increase in operating expenses is primarily associated with the operations of Santa Teresa Minerals, our wholly owned operating subsidiary in the ordinary course of business as well as legal and accounting expenses required by a public company and costs incurred in connection with the acquisition of Santa Teresa Minerals.
Technical Reports:
In June and July, Fladgate Exploration Consulting Corporation issued two NI 43-101 independent technical reports on our Free Gold and Casuto gold mining properties.
The report on the Free Gold properties stated that the preliminary results of the exploration pit program confirmed the general location and tenor of the mineralization reported from the 1991 pitting and trenching program. Samples were taken and passed through a wash plant including a series of sluice boxes and a final step of gold panning. Gold recovered from each sample was weighed to determine gold grade per cubic meter. Sampling was extended to bedrock wherever possible. Results show gold concentration ranging from 0.124 to 1.356 grams per cubic meter weighted average grade of .665 grams per cubic meter and a mean value of .699 grams per cubic meter.
The report notes that while the sampling process was the same in practice and principle as a mining process would be, the sampling method used had the potential to introduce human error during the sample collection stage and, therefore, the sampling method was not compliant with the standards for NI 43-101 and the results were inadequate to verify the actual amounts of gold in the alluvium. Fladgate did not perform any sampling or report any reserve estimates for the report.
The report concludes that the Casuto Project should be considered to be an early stage exploration project upon which Casablanca has begun to conduct an exploration program in order to gain a further understanding and testing the extent of the mineralization on the property.”
New Gold Project:
On June 29th 2011, Santa Teresa Minerals acquired a 70% interest in the New Gold properties, which consist of Los Pinos 1-30 and Teresita 1-20, from Benito Alfonso Ferrer Henriquez. The purchase price for the interests is USD 1,200,000 payable in agreed upon installments over the next thirty six months.
Mr Zirk Engelbrecht president of Casablanca Mining said that “The dramatic increase in gold prices has validated our focus on acquiring increased ownership interests in our existing properties and aggressively acquiring additional gold properties. We accomplished this in the second quarter and we continue with our plan to prove out our reserves, increase production at our Free Gold property and bring the New Gold properties online in late 2011.”
Anica Copper Mine Projects:
At the Anica copper mine, a new 2 kilometers road has been installed and a 15 drill hole drilling program has been completed. Drill rigs were used to drill down to a depth of 140 meters. Drilling samples were taken to determine the grade of copper at the mine. The copper raw material will feed the copper sulfate production facility, which is currently on time and within budget with an expected completion date of October 24th 2011. The samples are currently being evaluated by a third party laboratory contracted by Sulfatos Chile.
Electo-Mining Technology:
Additionally, on June 28th 2011 the China Patent Office granted a patent for the electro-mining technology owned by Fast Cooper. Santa Teresa Minerals owns 60% of Fast Cooper. Patents for the electro-mining process have been issued in Chile, South Africa and China and are pending in the United States, Canada, Australia and Brazil.
Mr Juan Carlos Camus Villegas CEO of Casablanca Mining said that “In the Q2 of 2011, we continued construction of our copper sulfate processing plant, drilled the Anica copper mine completed our 43-101 technical reports for Casuto and Free Gold completed the acquisition of new gold mining properties, received our electro mining patent in China and raised additional capital towards our 2011 operating budget.”
