Glass Earth Gold Limited: Exploration Update; Financial Statements; and Management's Discussion & Analysis for the Year Ended 31
March 20 2009 - 12:21PM
Marketwired Canada
Glass Earth Gold Limited (TSX VENTURE:GEL)(NZAX:GEL) ("Glass Earth") announces
the release of its December 31 2008 year end financial statements and
Management's Discussion and Analysis ("MD&A") report pertaining to that period.
EXPLORATION UPDATE
Glass Earth steps closer to gold production with encouraging results from placer
gold evaluation.
Glass Earth's placer mine evaluation studies are significantly advanced
following encouraging results from 122 shallow RC drill holes in the Central
Otago region in tandem with active exploration campaigns of drilling,
ground-based resistivity surveys, mapping, and analysis in the Hauraki (funded
and operated by Newmont); Mamaku-Muirs; and Otago Regions (see map below).
Newmont continues its active diamond drilling of Glass Earth's Hauraki projects,
commencing the highly prospective Wentworth/Glamorgan evaluation in April 2009,
followed by further drilling on the WKP (Wharekiriponga) prospect in the Upper
Waitekauri Valley, just 17kms from its Waihi operations.
Resistivity surveying on the Muirs/Massey Reefs followed encouraging drilling
results in 2008, assisting in delineating a potentially new high level vein
system adjacent to the known reefs. Infill resistivity will precede further
drilling in 2009 as funding becomes available.
Otago exploration has focussed on developing prospects highlighted in its recent
targeting campaign, with emphasis on targets recognised as having the signature
of orogenic gold mineralisation, and the size to generate large gold deposits.
Work in the Capburn, Stony Creek, Game Hen areas, and further work on the
Serpentine prospect (additional individual rock chips returning up to 31gm/t
gold, and 2.1gm/t gold in soils) are providing encouragement for further
investment in this region.
Central Otago Placer Mining
Glass Earth geologists have identified that the vectors to the major
mineralizing structures, recognized to host significant hard rock gold, lie
directly under placer gold mineralisation. Numerous placer opportunities are
recognized within Glass Earth permits.
122 shallow RC test drill holes have been completed over several areas within
the Company's extensive Otago permits (14,000km2). Preliminary results are very
encouraging; securing equipment and experienced local personnel for potential
placer mining operations is well advanced.
Glass Earth's extensive permit coverage places it in a superior position to
avail itself of these opportunities. Evaluation studies are currently underway
and upon allocation of resource consents and permits Glass Earth could be placer
mining by the Canadian fall (Sept/Oct).
In tighter operating conditions, the Company's cash of C$1.6 million, as at
September 30, 2008, together with cash from or work undertaken by contributing
joint venturers, is now budgeted to carry the Company through into mid-2010.
Importantly, work/permit obligations will be met.
FINANCIAL RESULTS
Glass Earth is an exploration company and therefore classified as being at the
'development stage', as it has no mining or other significant income. With all
general and administration expenses being expensed, Glass Earth records losses
each year arising from the expensing of these cash operating costs as well as
other non-cash expense items.
Total exploration expenditures amounted to $5.4m (NZ$7.2m) of which $2.3m
(NZ$3.1m) was contributed by other parties. Net exploration costs of $3.1m
(NZ$4.1m) were capitalized for the year.
The net loss for the year can include significant non-cash items:
12 months ended 12 months ended
December 31 2008 December 31 2007
Cash operating costs
Operating loss 1,197,000 884,000
Foreign exchange gain (3,000) (9,000)
----- -----
1,194,000 875,000
Non-Cash expenses
Write down Mineral Properties 288,000 619,000
Stock based compensation 75,000 382,000
Income tax expense/(benefit) - deferred (224,000) 810,000
------- -------
139,000 1,811,000
--------------- ----------------
--------------- ----------------
Net loss for the year 1,333,000 2,686,000
--------------- ----------------
--------------- ----------------
Notes:
- Cash operating costs were higher than anticipated principally due to
termination costs incurred in the closure of the Toronto representative office
in June 2008;
- One-off net revenue of $59,000 earned in the 2007 airborne geophysics campaign
was not repeated;
- Interest earned dropped from $186,000 to $86,000 due to reduced cash held and
a rapid drop in interest rates;
- Write-off of capitalized exploration expenses of $288,000 (NZ$0.4m) in
relation to relinquished ground;
- Fair value estimate of $75,000 (NZ$0.05m) for incentive stock options granted
to directors, staff and consultants;
- A partial reversal of the Deferred income tax provision of $224,000 (NZ$0.3m).
Qualified Persons
Glass Earth's exploration programmes are carried out under the supervision of
Glass Earth's President and CEO, Simon Henderson, M.Sc, M.AUSIMM, F.SEG. Mr.
Henderson meets the qualified person requirements (as defined by National
Instrument 43-101) with more than 30 years of experience in the gold mining and
exploration industry.
About Glass Earth Gold Limited
Glass Earth is one of the largest New Zealand-based gold exploration companies
exploring a land position of over 17,000 km2 in the North and South Islands.
With its main office in Wellington, New Zealand, Glass Earth Gold Limited is
listed on the TSX Venture Exchange (TSX VENTURE:GEL) and the New Zealand
Alternative Stock Exchange (NZAX:GEL).
To receive Company news via email, contact lindsay@chfir.com and mention "Glass
Earth news" in the subject line.
To view the map accompanying this release please click the following link:
http://media3.marketwire.com/docs/New%20Zealand%20Permit%20Areas.pdf
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