Central Rand Gold Regulatory News (CRND)

31 Jul 2008 07:00



For immediate release  31 July 2008

Central Rand Gold Limited ("CRG" or the "Company")

(Incorporated as a company with limited liability under the laws of Guernsey, Company Number 45108)

(Incorporated as an external company with limited liability under the laws of South Africa, registration number 2007/0192231/10)

ISIN: GG00B248M601

Share code on LSE: CRND

Share code on JSE: CRD

EXPLORATION AND OPERATIONAL UPDATE

HIGHLIGHTS

Positive results from underground bulk sampling

On track to receive mining right 

Trial mining scheduled to begin in October 2008

New Mining Order Right

Central Rand Gold remains firmly on track to be awarded its New Order Mining Right by the South African Department of Minerals and Energy (DME). The approval process is well advanced and the Company looks forward to concluding the process in the short term. 

The Mining Right application was accepted by the DME on August 8 2007 and has been supplemented by the implementation and submission of all other necessary processes and documentation.

Exploration Update

Considerable exploration activity has taken place resulting in ongoing drilling, assaying and bulk sampling initiatives across the Company's prospecting areas.

Bulk Sampling

Underground bulk sampling has confirmed mineralisation outside of reefs and substantial thicknesses of mineralised grits have been identified. 

Significantly, mineralised halos have also been identified in the hanging wall and foot wall of conglomerate bands. Underground bulk sampling is currently investigating these mineralised zones.

As part of CRG's exploration programme (surface mapping, diamond drilling, shaft re-access and resource conversion investigations), zones of mineralisation (in the form of pervasive disseminated pyrite and grit bands) have been identified in the hanging wall of the Main Reef Leader and the South Reef on CMR. 

CRG has undertaken an extensive bulk sampling exercise to quantify these mineralised zones. These zones of mineralisation have the potential to add to the mineable tonnage and resource estimates. This also suggests that mass mining in larger stopes will be viable. 

The Company embarked on its underground sampling process in June 2008. The first samples were obtained through access via East Shaft (Consolidated Main Reef) on 5 level (60 metres below surface).

Approximately 100 metres of strike was sampled from the hanging wall of the South Reef utilising a method referred to as "slyping". This involves drilling holes of approximately 200 to 500mm (spaced about 1m apart) into the hanging wall and utilising expanding gas cartridges to "pop" off the sample. The sampling is geologically controlled and a single bulk sample can be made up of 10 to 15 separate entities, depending on the geological feature being analysed. A bulk sample can weigh up to 0.5 ton.

The initial results have become available and are proving to be encouraging (Table 1). This represents a range of 0.5 g/t to 1731 g/t from each 0.5 tons of homogenised sample. 

Table 1: Initial Results of Bulk Sampling

The implications of these results are significant. They show that the source of gold is not only confined to the conglomerate bands, but are also present in grit bands, zones of disseminated pyrite and in inter-conglomerate quartzites. This finding would add significantly to the amount of tonnage and resources available for mining.

Bulk sampling is continuing and is currently focusing on  a cross-cut from the Main Reef to the South Reef (on 5 level, East Shaft) and on 9 level (±190m below surface, East Shaft) and will commence in the near future on 5 level, New Unified Shaft (CMR, approximately 3500m to the west of East Shaft).

(* please refer to the Company's website for a diagram)

Other exploration achievements:

Seven shafts have been re-accessed 

Completed reconnaissance sampling and mapping over CMR, Crown Mines and Langlaagte 

Preliminary mapping on City Deep 

Confirmation of un-mined mineralised pillars and reefs through underground surveying an sampling programme

Reconnaissance drilling on Pyritic Quartzites of Village Main and City Deep Resource upgraded by 1.8Moz in March 2008

Initial production slots/surface targets identified - slots 2,3,4,5,7,8,9 and 14  

Reconnaissance mapping has identified:

Pyritic Quartzites (Erosional Channels cutting through the North, Main Reefs and Main Reef Leader)

Viable grades in the soils

Un-complicated mineralogy of orebodies increasing the potential for better recoveries

Drilling

Since the start of the drilling programme in November 2006, CRG has completed 32,247m of reverse circulation drilling, 2,509m of soil sample drilling, 1,456m of geotechnical diamond drilling and 15,831m of diamond drilling. 

(* please refer to the company website for a diagram)

Drilling has provided the following information:

Regional mapping first indicated the presence of mineralisation outside the conglomerate bands or 'reefs'. Drilling these occurrences has confirmed zones of mineralisation in disseminated pyrite and grit bands outside the known reefs. Following on from this discovery, underground exploration has confirmed its presence. It became apparent that quantifying these additional sources of gold would have to be through bulk sampling. Channel sampling produces a 1 in 12000 representation whereas bulk sampling produces a 1 in 200 representation making the data more reliable.

The results from the underground bulk sampling are significant as they confirm the presence of mineralised material outside the conglomerate bands in zones of disseminated pyrite, grit bands and inter-conglomerate quartzites. This finding would also add significantly to the amount of mineable tonnage.  

(* please refer to the Company's website for a diagram)

Gold production ramp-up

The Company is on schedule to meet its initial target of producing gold at an annualised rate of 100,000 ounces by the end of 2009 with trial mining to begin in October 2008. 

Trial Mining

The Company has purchased a plant with the capacity to process ore at a rate of 20 tons an hour from trial mining. The plant, acquired from Gekko Systems in Australia at a cost of US$5.74 million, comprises a communication circuit, a gravity circuit and a flotation circuit. 

It is expected that the plant will be shipped from Melbourne in August 2008 and is scheduled to arrive in Johannesburg mid September. It will be erected and be suitable for commissioning shortly  after its arrival. 

The trial mining plant, which will be situated on the surface, is expected to be fully commissioned in October and is expected to ramp up in the following months to a target rate of around 12,000 tons of ore per month. 

Trial mining will confirm the Company's mining and metallurgical concepts and determine the final configuration of mining/processing requirements, leading to the commencement of full scale mining from surface deposits by the end of the first quarter of 2009.

Full scale mining

Full scale mining of already targeted surface deposits (down to 10m below surface) and shallow underground mining (between depths of 10m to 70m) will begin by the end of Q1 2009. The first three mining slots will be accessed for surface mining as well as providing access for the company's ongoing drilling and underground bulk sampling programmes. 

Issued on behalf of: Central Rand Gold Limited

Date: 31 July 2008

Contact: 

Greg James

Ric Vittino

Wayne Epstein

(011) 551 4000

info@centralrandgold.com

Enquiries:

Buchanan Communications Limited +44 (0) 20 7466 5000

Bobby Morse / Ben Willey

Evolution Securities Limited +44 (0) 20 7071 4300

Simon Edwards / Chris Sim / Neil Elliot

Jenni Newman Public Relations (Pty) Ltd +27 (0) 11 772 1033

Jenni Newman / Megann Outram

Macquarie First South Corporate Finance +27 (0) 11 583 2307

Amanda Markman / Thato Morojele / Annerie van den Berg