PERIOD ENDED 31 MARCH 2012 1. QUARTERLY HIGHLIGHTS
Mexico Cerro del Gallo ~100,000oz pa AuEq gold/silver advanced development project
? Release of DFS imminent
? DFS works substantially completed and report finalization progressing Namiquipa silver/lead/zinc exploration project
? Princesa Vein and Northern extensions the primary focus
? High grade mineralization in northern extension Espiritu Santo Jalisco gold/silver exploration project
? Rock chip sampling program continues
? Mapping and vein identification program underway Australia
? Mt Philp Ironstone exploration project
? Updated resource estimate announced
2. CORPORATE
Cash at Bank at 31 March of $7.5M.
Management focused during the quarter on advancement of the definitive feasibility study at Cerro del Gallo and advancement of exploration projects: Namiquipa and Espiritu Santo Jalisco.
Cerro del Gallo
Work on the Cerro del Gallo stage 1 Definitive Feasibility Study (DFS) by Sedgman Metals has advanced significantly.
The Company anticipates it will be in a position to release results relatively soon and whilst cautious of specifying a timeline given recent experiences, it is considered safe to say the report will be released within the 2nd quarter 2012.
Disappointment with the delay in delivering this key study is acknowledged however, incorporation of a High Pressure Grinding Roll (HPGR) crushing circuit and SART process, together with delays in receipt of additional laboratory test work, costings and inputs from 3rd party consultants and contractors have necessitated additional time to be taken to produce a definitive project evaluation.
The Company has taken time, and continues to do so, to evaluate all test work and costs where there has been an escalation.
These delays unfortunately reflect, in part, the peak demands on the time and availability of requisite external technical specialists during the current global mining boom. Likewise, cost increases highlight the industry demands.
The Company is confident, however, that these additional efforts and processes will enable a more robust project to be presented for the Cerro del Gallo 1st stage heap leach.
CJO Price at posting:
9.9¢ Sentiment: Buy Disclosure: Held
