The news release this morning tells us that the feasibility study will be released next week on Tues April 24th.  To me this is extremely positive for the company and the share price of Woulfe should move higher.  If you do not know what a feasibility study is or how it might affect the share price we  have you covered in our e-book Mining Stocks Investor Guide.

Woulfe is well on its way to fast tracking into production.

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2012-04-17 06:29 PT – News Release

Mr. Brian Wesson reports

WOULFE MINING CORP. MOVING FORWARD IN SOUTH KOREA

Woulfe Mining Corp. is providing an update to shareholders.

• The feasibility study is on schedule for release on Tuesday, April 24, 2012.
• Sangdong is in discussion with prospective banks to obtain project financing. The debt financing is intended to provide all the necessary capital through the production with no dilution to existing shareholders.
• The detail design drawings for the process plant have been completed and will be submitted to the appropriate Korean government authorities for final construction approval.
• Woulfe welcomes Brian Burdett, project manager, on-site in Korea. Mr. Burdett is a metallurgist by training with an extensive 47-year background in tungsten and resources globally.
• Sangdong has paid its contribution for the installation of two 10-megawatt power feeds to the minesite from different regional substations to allow for security of supply. The plan released by Korea Electric Power Corp. indicates the installation of the first 10 megawatts by October, 2012, and the second 10 megawatts by December, 2012.
• Paste fill disposition and plant design were completed for reaching feasibility. The paste filling is important as it disposes of all tailings into the new and old voids behind mining of virgin blocks and reclamation, and stabilizes the mining areas which will be mined through a cut-and-fill method.
• Resource drilling is continuing in the western block of the orebody 1,200 metres on strike from the main mine entrance. The eastern area of the upper section will be mined for the initial 12 years of operations.
• Moody’s upgraded South Korea from A1 to AA3 credit rating this month.
• The ruling party in Korea has been re-elected with a vast majority in the congressional election held on the April 1, 2012. This is important for Woulfe as the government departments have worked with the company to move the project forward, visiting site and understanding all the parameters of mining.

Brian Wesson, chief executive officer of Woulfe, added: “We are now in a development phase and detail design is nearing completion at the Sangdong project. Woulfe is unique as we are completing our construction drawings in parallel with the feasibility study which allows us to move directly to construction. The company is well positioned with physical advantage in a low-risk, OECD country and we believe production from Sangdong in 2013 will bridge the current gap in the tungsten market. Woulfe is poised to move forward having a good asset and a large strategic partner that provides us with a great platform for success in our drive to be the world’s largest tungsten producer outside China.”

Background

Sangdong is one of the world’s largest tungsten deposits with the longest history of supplying high-grade tungsten globally. Woulfe is bringing the project back to life using modern mining and processing technology. The project is unique as it will produce concentrates but also has a refinery to value add the product to be directly used by the tungsten manufacturing industry. The company’s strategic partner IMC brings a strong balance sheet, process technology and a fixed market for 90 per cent of concentrate and refined product. It has taken Woulfe two years to bring the plan to final execution for shareholders when tungsten is above $40,000 per tonne.

Excalibur resources is in the final stages of beginning production at it’s mine in Mexico.

Excalibur issued a press release this morning – I am hoping this will be the last financing needed to get into production.

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Excalibur arranges $870,000 private placement

2012-04-16 06:44 PT – News Release

Mr. Tim Gallagher reports

EXCALIBUR RESOURCES ARRANGES PRIVATE PLACEMENT

Excalibur Resources Ltd. has arranged a non-brokered private placement of up to six million units at 14.5 cents per unit for a total of $870,000. Each unit consists of one common share and one-half share purchase warrant. Each whole warrant is exercisable to acquire an additional common share at 20 cents per share for a one-year period.

Net proceeds will be applied to working capital and to the company’s Catanava gold production project in Mexico.

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Yesterday afternoon Lucara Diamonds issued a press release updating what is going on with the company. It appears everything is on schedule and commissioning of the new mine has begun.

Lucara was our pick #9 here in our top 10 picks for 2012.

2012-04-11 14:07 PT – News Release

Mr. William Lamb reports

LUCARA DIAMOND CORP.: KAROWE COMMISSIONING UPDATE

Lucara Diamond Corp. has provided an update on the construction and commissioning activities at its wholly owned Karowe mine in Botswana.

Construction of the process facilities and associated infrastructure is on schedule, and was sufficiently complete at the end of first quarter 2012 to allow for commissioning activities to commence in April.

All sections of the process plant have been individually operated with run-of-mine ore with a number of these sections having already been run at or above design capacity. To date, as part of the commissioning process, more than 5,000 tonnes of ore have been processed through the front-end of the plant. Mining activities are significantly advanced with more than 280,000 tonnes of stockpiled ore being available to support the commissioning and ramp-up activities.

The team at Karowe continues to make excellent progress on commissioning activities. Hand-over to operations will commence once all sections of the process plant are operating as a single system.

Ramp-up to steady state full production will continue through second quarter 2012.

William Lamb, president and chief executive officer of Lucara Diamond, commented: “This is a significant milestone for Lucara. The first diamond production from Karowe edges us closer to being part of an exclusive group of diamond producers. Our focus over the coming months will be to drive towards sustainable production.”

Qualified person

Anthony George, PEng, a mining engineer and Lucara’s vice-president development, is the company’s qualified person pursuant to NI 43-101 and has reviewed the technical contents of this news release.

The share price since we mentioned it is a little higher. Freegold continues to go quietly about its business and move forward adding ounces through drilling.

The last update is substantial as the Vinasale project is now at 1.73 m ounces Au inferred.

I have added my comments in blue in the news release below.

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2012-03-29 15:00 PT – News Release

Ms. Kristina Walcott reports

FREEGOLD OUTLINES 1.7 MILLION OUNCES OF GOLD AT VINASALE, ALASKA

Freegold Ventures Ltd. has released the results of an NI 43-101-compliant mineral resource estimate recently completed on the Vinasale gold project located in southwest Alaska on which Freegold entered into an exploration agreement with an option to lease the Vinasale project from Doyon Limited, an Alaskan native regional corporation, in 2007. The resource estimate was completed by Giroux Consultants Ltd. of Vancouver, B.C. Canada. Inferred resources are 49.3 million tonnes averaging 1.09 g/t Au for 1,735,000 ounces of gold utilizing a cut-off value of 0.5 gram/tonne (g/t) as a possible open pit cut-off.

1.735 ounces is a fairly big size deposit already and looks like it will only get bigger. The average grade is 1.09 g/t which is good and an important factor to look at when evaluating deposits. One thing to note is that this is an inferred resource estimate. If you do not know what an inferred resource estimate means check out our e-book Mining Stocks Investor Guide.

The addition of 13 drill holes drilled in 2011 and the expansion of the geologic solid have expanded the resource at a 0.5 g/t cut-off by 32.4 per cent on tonnage at essentially the same grade for an increase of 30.4 per cent ounces of contained gold from the March, 2011, resource estimate.

13 drill holes increasing the resource by 30.4% is impressive.

A total of 85 drill holes containing 10,945 gold assays have been completed on the project within three areas: the Central, Northeast and South zones. The highest density of drilling has been completed in the Central zone where 41 drill holes totalling 9,948 metres were used in estimating the resource for the Central zone. Gold assays were capped at 22.0 grams/tonne gold. Composites, five metres in length, were used to model the grade continuity using semivariograms. Blocks measuring 10 by 10 by five metres were populated using ordinary kriging.

                  VINASALE CENTRAL zone INFERRED RESOURCE

 Au Cut-off (g/t)          Cut-off (tonnes)       Grade      Cut-off

                                               Au (g/t)     Contained
                                                          kgs Au  ozs Au 

             0.10               87,370,000        0.74    64,570  2,076,000
             0.15               80,380,000        0.79    63,740  2,049,000
             0.20               74,930,000        0.84    62,790  2,019,000
             0.25               70,040,000        0.88    61,640  1,982,000
             0.30               65,620,000        0.92    60,440  1,943,000
             0.40               57,350,000        1.00    57,580  1,851,000
             0.50               49,320,000        1.09    53,960  1,735,000
             0.60               42,250,000        1.19    50,110  1,611,000
             0.70               36,100,000        1.28    46,100  1,482,000
             0.80               30,840,000        1.37    42,160  1,355,000
             0.90               26,310,000        1.46    38,310  1,232,000
             1.00               22,420,000        1.54    34,620  1,113,000
             1.10               19,080,000        1.63    31,120  1,001,000
             1.20               16,110,000        1.72    27,710    891,000
             1.30               13,520,000        1.81    24,480    787,000

To date, mineralization in the Central zone extends over a strike length of 400 metres and remains open to the south, east and at depth.

Project is open to getting bigger from the south,east and at depth.

The 2012 program will consist of additional drilling in the Central zone where it remains open to the south, as well as potential resource definition in the North East zone. The zone was further defined by the 2011 ground geophysical program and limited prior drilling. The program is scheduled to commence in mid-May.

The qualified person for this release is G.H. Giroux, MASc, PEng, who has reviewed and approved the contents of this press release.

ALS Chemex was used to analyze 1464 core samples via fire assay analysis for gold plus multielement ICP-AES and ICP-MS analysis using four-acid digestion for the 2011 Freegold drill program. Quality control entailed insertion of 34 blanks and 100 standards into the sample stream, at the rate of approximately one QA/QC sample every 10th assay, yielding approximately 11 per cent of the total core assays. On average all of the reported standard and blank assay values were within an acceptable margin of error.

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Continue to keep Freegold Ventures on your watchlist!

In exchange for waiting royalty companies receive an excellent return on investment especially if the commodity price increases. A tremendous advantage for royalty companies  is that royalty deals are structured on a % of sales (production). This is important because as costs go up it does not affect the royalty company.

Two risks of investing in a gold royalty company are:

1) Production risk – This occurs when a partner does not meet production targets. This will for the most part be temporary as the partner figures out whatever issues it may be having.

2) Commodity price risk –  This occurs if the commodity decreases in price. This is not a huge worry since most royalties have been bought at levels far below the current gold price.

The advantage of investing in gold royalty companies are:

1) Diversification – The big royalty companies RGLD and FNV have deals that are geographically diversified all around the world. Each company they have a royalty with is a small % percentage of the overall portfolio. If one or more company struggles it is not a huge impact on the overall portfolio.

2) Low overhead costs – Gold royalty companies only have to deal with administrative costs and can forget worrying about the actual expenditures of being a producer. With inflation increasing significantly over the last several years for gold companies this is a key advantage. The cash cost of production is becoming higher and higher and this is one of the reasons you see a lack of movement in gold companies even with the increasing gold price.

A list of gold mining royalty companies:

* Chart as of close on March 28,2012

Franco Nevada (FNV) – Is the largest gold royalty company with a market cap of $6.5 billion.  They are led by chairman Pierre Lassonde who is considered by many to be a living legend in the mining industry. Franco-Nevada is the leading gold royalty and stream company in terms of revenue and number of assets. They hold over 200 mineral royalties and streams as well as over 200 oil and gas royalties. Franco-Nevada has a strong balance sheet with a cash position of over $794 million ($5.50 per share) at year end 2011.  A monthly dividend is also a nice bonus of investing in FNV even with it only being 4 cents a share.

Royal Gold (RGLD) (RGL.T) – Royal gold is the 2nd largest gold company with a market cap of $3.8 billion. With  strong management and a quarterly dividend of 15 cents a share Royal Gold is poised for growth. Royal Gold was named on the Forbes 2011 best small companies list coming in at #42.

Sandstrom Gold (SSL) – Sandstorm Gold is the smallest gold royalty company. It is led by Nolan Watson former CFO of Silver Wheaton which is the largest silver royalty company in the world. In 2012 so far Sandstorm is one of the best performing stocks on the TSX Venture going from $1.24 to $1.90 per share. The management team also runs a metals and oil royalty company Sandstorm Metals and Energy.

With a rising gold price keep these gold royalty companies on your watchlist.

James Fraser

Co-author Mining Stocks Investing Guide

Today’s news was kind of  interesting to me since I made some money (a double) on the previous warrants just before the mine went into production.

If you do not know what a warrant is or how to trade them check out our e-book  Mining Stocks Investor Guide.

I expect these warrants to become trading at a very low price… providing a possible opportunity here.

2012-03-28 17:44 PT – Warrants Called to Trade

Great Basin Gold Ltd. will list 33.35 million share purchase warrants on the Toronto Stock Exchange at the open on Friday, March 30, 2012, according to the TSX. As in a March 23, 2012, short form prospectus, Great Basin plans to sell 66.7 million units to the public at 75 cents each, raising $50,025,000. Each unit consists of one share and one-half of a share purchase warrant. Each whole warrant entitles the holder to buy one additional Great Basin share for 90 cents until 5 p.m. (Pacific Time) on the date that is 24 months from the closing of the offering. The TSX reports the warrants will trade under the symbol GBG.WT and Cusip No. 390124 13 9.

Woulfe is our #1 pick for 2012.

This is great news that recovery rates are 15% above historical rates when the mine was in production. I expect to see another move when the feasibility study is released mid April. If you are unsure what a feasibility study is- take a look at our e-book Mining Stocks Investor Guide.

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2012-03-28 05:45 PT – News Release

Mr. Brian Wesson reports

WOULFE MINING METALLURGICAL RECOVERY 15% ABOVE HISTORICAL

Woulfe Mining Corp. has completed metallurgical test work for feasibility.

Brian Wesson (FAusIMM) CEO/President of Woulfe commented “It was not an easy decision for management to delay the feasibility study to seek out the best technology available as a base of metallurgical test work. What made this even more difficult for us is that our signed strategic agreements require the feasibility study for the completion of due diligence. This time and effort was well spent as we have now shown that recoveries of 85% can be achieved, some 15% higher than historical. This positively impacts the return on investment as higher concentrate grade reduces both capital and process costs. Truly a great achievement so now the feasibility is moving rapidly to completion, and will be released in mid-April 2012.”

Metallurgical Testwork 85% recovery

Metallurgical testwork on the Sangdong scheelite ore has proved a highlight of finalising the inputs to the Sangdong project Feasibility Study. Having established the optimum grind size, an all flotation circuit was trialled. The success of this and its lower capital cost compared with the more conventional gravity plus flotation circuit has resulted in its adoption as the project moves through feasibility to production.

The process first floats the molybdenum, bismuth and other sulphides into a sulphide concentrate using conventional sulphide flotation. The molybdenum and bismuth concentrate can either be sold or further processed to highly value added products. Having removed the sulphides, the scheelite is then initially floated giving it an upgrade ratio of up to 20 times at very high scheelite recovery. This concentrate is then thickened and heated as feed to a flotation circuit incorporating modifications to the well-known Petrov process. The small quantity of thickened and heated concentrate is floated using conventional, but intense flotation conditions. This has resulted in the production of concentrate grades of more than 70% WO3 at recoveries above 85%. The feasibility study has been modified to include these exciting results. New tonnage samples are now being mined from the advanced re-opening of the Sangdong mine to provide adequate feed to verify the feasibility study results by pilot plant testing.

Concentrates from the pilot plant will be used to define the design criteria for the planned ammonium paratungstate plant (APT plant) that under the IMC agreements will be funded by our off-take partner as part of the off-take agreement announced earlier this month.

This news release has been reviewed and approved in the form and context in which it appears by Mr Rod Elvish FAusIMM, who is working with Woulfe on the Sangdong metallurgical study. Mr. Elvish has appropriate qualifications and sufficient relevant experience to qualify as a Qualified Person for the reporting of mineral resource metallurgical test work and studies and interpret the results.

We seek Safe Harbor.

Last week on Thursday they came out with a press release stating they have sold the Auro and Auro South properties to New Gold.

The deal is that Gold Reach receives $6 million in cash and a 2 percent net smelter royalty on the claims and New Gold has committed to spending 1.5 million on exploration on the claims in the next 3 years.

This is good news for Gold Reach as they will not have to go to the market for a financing.  This is important because it keeps the float low with only 23,572,884 shares out (34,043,266 FD).

With shares currently trading at 62 cents the market Cap is only just over 14 million. If you subtract the 6 million in cash GRV is being valued by the market for only 8 million.

For more on market cap and valuing Mining Companies please take a look at our ebook Mining Stocks Investor Guide.

The press release out this morning tells you what the plans are with that $6 million.  A minimum 20,000m drill program will begin in May at the Ootsa property.

“A drill contract has been signed with Full Force Diamond Drilling Ltd. and two drills will be mobilized to the Ootsa property. Drilling will initially focus on delineating the West Seel deposit, which was discovered near the end of the 2011 drilling program. The last hole drilled during the 2011 drilling program at West Seel returned 566.7 metres grading 0.54 per cent copper equivalent and the hole ended in mineralization. The new discovery remains open to the west, north, south and at depth. A large mineralized zone intersected by holes S11-98 and S11-100 remains open up dip, at depth and to the southwest. A series of proposed holes spaced roughly 100 metres apart are designed to trace the mineralized zone to surface, extend the mineralized zone to depth and determine the southwest extent of mineralization.”

Gold Reach is an exciting exploration company that has a low float, is cashed up, and getting set to drill an exciting property with excellent previous drill results.

Make sure to keep GRV on your watchlist!

We have been following Lucara since we made it our pick #9 at 83 cents. For our initial coverage please click here.

Overall Lucara has had a positive year and should see positive share price appreciation as they begin production. The chart below discussed in depth in our ebook Mining Stocks Investor Guide shows the typical Junior Mining share price. Lucara is currently right at the Start Up phase and should see share price appreciation as they begin to bring in cashflow.

2012-03-22 16:04 PT – News Release

Mr. William Lamb reports

LUCARA 2011 YEAR END HIGHLIGHTS

Lucara Diamond Corp. has had an outstanding year of achievement.

Highlights include:

• The start of commissioning of the new Karowe diamond mine in Botswana: acquiring a valuable resource and financing and building a new state-of-the-art mine within only 18 months of a positive feasibility study are a remarkable achievement and a testament to the company’s top-class development and operations team.
• Total ore mined at Karowe forecast for 2012 is 1.9 million tonnes and is expected to achieve an annualized rate of 2.5 million tonnes per year in third quarter 2012.
• Diamond sales are forecast at 300,000 carats in 2012, achieving an annualized 400,000 carats per year. First diamond sale is expected during the second quarter of 2012.
• Operating costs of $20 per tonne are anticipated to be achieved by fourth quarter 2012.
• Karowe is an important new mine in the diamond industry. Modelled diamond valuations increased by 24 per cent to $301 per carat (at a 1.5-millimetre cut-off size) in a new independent report completed in November, 2011. The independent valuation was completed by Mercury Diamond with the associated revenue modelling completed by the MSA Group in reports dated November, 2011.
• Construction capital for the new Karowe mine is trending within the forecast budget of $120-million. Construction financing and general working capital for the company were raised through a combination of equity and debt, which include the recently announced $25-million revolving credit facility with Bank of Nova Scotia.
• At Mothae, the company’s other diamond project, located in Lesotho, trial mining to date has met or exceeded expectations. The trial mining program involves the processing of 720,000 tonnes of kimberlite to establish operational and economic data for possible future mine development. As of Dec. 31, 2011, over 405,000 tonnes of kimberlite have been processed, yielding in excess of 13,220 carats (two-millimetre cut-off).
• Many of the stones recovered at Mothae have been large, high-quality diamonds, including several Type IIa. Recent examples were a 28.89-carat diamond, which sold at auction for $1.6-million ($57,113 per carat), a 56.51-carat diamond, which sold for $2.1-million ($37,019 per carat), and a 19.20-carat diamond, which sold for $490,000 ($25,520 per carat). These prices signify the exceptional quality and size of the stones that are regularly recovered from Mothae.
• The company completed two sales of Mothae diamonds during the year, earning gross proceeds of $14.6-million (average $881 per carat). These excellent results triggered the commissioning of a preliminary economic assessement, which is currently under way, and is expected to be completed in fourth quarter 2012. Mining, processing and infrastructure costs will be defined to a prefeasibility level as part of the study.
• During the year, the company graduated to the Toronto Stock Exchange from the TSX Venture Exchange, reflecting the company’s growth and status as a near-term diamond producer. In addition, the company listed on the Nasdaq OMX exchange in Stockholm and the Botswana Exchange reflecting the strong international interest in the company.

William Lamb, president and chief executive officer of the company, commented: “We’ve had an excellent, solid year of achievements as we prepare for the transition of Lucara from a development company to a new diamond producer. The delivery of the Karowe mine in 2012 is testament to management’s ability to deliver a world-class diamond mine on budget. We’re proud of what we’ve accomplished and look forward to an exciting new chapter ahead as we enter the exclusive world of diamond producers.”

Business review

Karowe mine — Botswana

In 2011, activities across engineering, procurement, construction and the development of the operations team advanced the project significantly. By year-end, engineering, procurement and fabrication activities were essentially complete, and project construction was standing at over 90 per cent complete. Delays to the project schedule as a result of the steel industry industrial action in July, 2011, impacted the overall project schedule with the result that commissioning is expected to be completed early in the second quarter of 2012.

As at December, 2011, the project had achieved one million hours without a lost-time injury, and no environmental incidents had been recorded. As at the end of February, 2012, the project had achieved more than 1.5 million hours without a lost-time injury.

Environmental and community relations activities as detailed in the environmental management plan were well executed throughout the year. A competition to rename the mine as it transitions into production was well supported by the local communities and schools, and Karowe (meaning precious stone in the local dialect) was selected. Several community projects, including village cleanup campaigns and health and wellness initiatives, in conjunction with the community members, were completed. Archeological monitoring of all construction areas continued throughout the year, and no artifacts were discovered on site or at the Boteti housing sites in Letlhakane.

The 25-kilometre, 33-kilovolt-amp power line from the Orapa substation and the Karowe mine site substation were completed during the last quarter of 2011 and handed over to BPC. The mine has switched to grid power to support commissioning activities and the ramp-up to full production.

The mine operations contract with Kalcon (Pty.) Ltd. was concluded midyear and the contractor mobilized to site in October. The initial mine development has gone according to plan, ore boundaries match the resource model and initial ore benches have been established. At Dec. 31, 2011, an ore stockpile of 230,000 tonnes had been established to support commissioning activities, with 552,000 tonnes of waste having been removed and stockpiled.

The process plant operations and maintenance contract was also concluded, and the company’s contractor, Minerals Operations Executive (Pty.) Ltd., is site established. Minopex is working with the operations staff on process stores and operational procedures and is also fully integrated with the process plant commissioning team.

The operations senior management and technical and support staff were recruited as required to support project advancement throughout the year.

In Gaborone, the sales and marketing offices were completed, and the senior staff recruited. The installation of the security systems and the stock control systems commenced in the fourth quarter.

Mothae project — Lesotho

Mothae processed 31,488 dry tonnes (36,430 wet tonnes) of kimberlite in the fourth quarter of 2011 recovering 796.97 carats. In 2011, Mothae processed 208,293 dry tonnes (244,532 wet tonnes) of kimberlite recovering 12,157.35 carats of diamond. For the trial mining program, which commenced in June, 2010, a total of 467,071 wet tonnes (399,408 dry tonnes) of kimberlite have been processed as of March 11, 2012, resulting in recovery of 31,771 diamonds weighing a total of 14,672.57 carats.

              MOTHAE TRIAL MINING RESULTS AS OF MARCH 11, 2012  

                                                            Dry       Grade
Sample            Stones        Carats    Ct/stone       tonnes   (cpht) (i)

F1D                  111         77.65        0.70        1,592        4.88
C4A                1,458        759.23        0.52       29,649        2.56
C5A                3,133      1,120.07        0.36       48,542        2.31
C6A                  529        260.50        0.49        7,296        3.57
C8A                3,522      1,442.13        0.41       49,152        2.93
C9A                3,841      1,940.71        0.51       40,370        4.81
G2A                4,256      1,909.78        0.45       33,691        5.67
F2A                4,083      1,979.66        0.48       50,181        3.95
G2B                3,022      1,286.89        0.43       22,689        5.67
G3A                3,722      1,654.70        0.44       29,874        5.54
C7A                  875        403.20        0.46       18,425        2.19
C6B                  572        348.02        0.61        9,592        3.63
E2A                  631        329.06        0.52       15,720        2.09
C11A               2,016      1,160.87        0.58       42,634        2.72
Total             31,771     14,772.57        0.46      399,408        3.67

(i) All samples processed using a bottom cut-off size of two millimetres.

As of March 11, 2012, the trial mining program at Mothae has produced 14 diamonds greater than 20 carats and 54 diamonds between 10 and 20 carats. The three largest stones produced to date are 56.62, 53.53 and 53.24 carats.

Plant throughput was reduced in the fourth quarter of 2011 as a result of a shutdown in November to complete upgrades to the plant crushing and diamond recovery circuits. These included integration of a new secondary crushing circuit required to handle harder kimberlite material as mining operations move deeper into less weathered, fresher kimberlite, interlocking a Bourevestnik high-intensity diamond recovery unit into the main plant circuit. In December, the plant operated at a reduced throughput as part of the commissioning of these upgrades.

Samples G3A, C7A and C6B were completed in the fourth quarter. A small tonnage of sample E2A was also processed as part of the commissioning of plant upgrades.

No grease table audits of X-ray recovery tailings were conducted during the quarter, and diamond grades reported herein are subject to change pending audit results.

Tonnage estimates are based on daily plant weightometer readings and moisture content measurements to determine a dry tonnage estimate. The process plant is being operated by Minopex under contract to Mothae and operates at a two-millimetre bottom cut-off size for diamond recovery. Diamond recovery and characterization work is carried out by the Mothae diamond-sorting staff with recovery results being monitored and reported by Remote Exploration Services, also under contract to Mothae.

In August, 2011, Mothae acquired a Bourevestnik X-ray (high-intensity X-ray) diamond recovery machine in an effort to improve recovery of low-luminescent, potentially high-value Type IIa diamonds. The Bourevestnik unit was initially tested and commissioned in an audit capacity to audit recovery tailings from the Flowsort and VE X-ray diamond recovery units in the main plant circuit. In the fourth quarter of 2011, the Bourevestnik unit was interlocked into the main plant circuit as the primary large diamond recovery facility, bypassing the Flowsort unit, which has been taken off-line.

During the quarter, primary and a secondary crushing units were installed and commissioned. Both units are required to process harder kimberlite and basalt xenoliths efficiently and, in particular, to process unweathered kimberlite samples that are planned in 2012.

A drilling contact was awarded to Remote Drilling Services to conduct a 5,400-metre delineation drilling program. The objectives of the program are to define the internal geology of the Mothae kimberlite, as well as to extend the currently defined kimberlite volume from a depth of 200 metres to 320 m, to collect suitable sample material for ore-dressing studies and to collect core for geotechnical evaluation. As of March 11, 2012, RDS was ahead of schedule and had completed 20 of the planned 28 holes for a total of 3,838 metres.

During October, 2011, a contract was awarded to ADP Projects (Pty.) Ltd. to complete a preliminary economic assessment of the Mothae kimberlite. The objective of this study will be to gain an increased understanding of the economic potential of the Mothae project through greater definition of the capital and operating costs, which will be defined to a prefeasibility level, required for the development of a mine at Mothae.

Two diamond sales were completed during the year. The first took place in March, 2011, which sold a total of 9,379 carats for gross proceeds of $8.2-million (average of $871 per carat). The second took place in December, 2011, which sold a total of 7,190 carats for gross proceeds of $6.4-million (average of $893 per carat).

During the third quarter of 2011, Mothae completed an environmental impact assessment of the Mothae project based on a conceptual mining study completed by the company in 2009. The EIA has been submitted to and approved by the Lesotho Department of Environment in the fourth quarter.

        SUMMARY FINANCIAL RESULTS FOR THE YEARS ENDED DEC. 31
              (U.S. $ millions (except per share amounts))

                                                Year ended      Year ended
                                            December, 2011  December, 2010 

Diamond sold -- gross proceeds                       $14.6              --
Net (loss) for the year                              (18.7)         $(15.6)
Basic and diluted (loss) per common share             0.05            0.06

Diamonds sold and net loss during the period

The net loss for the year ended Dec. 31, 2011, was $18.7-million. This reflects the exploration and depreciation costs at Mothae, net of two diamond sales of 16,571 carats, for gross proceeds of $14.6-million. The sales included the rough diamond inventory that was held at Dec. 31, 2010, which was valued using the company’s best estimate of the lower of cost and net realizable value. The company has recorded a gain on the sale of this inventory in the amount of $2.3-million. The remaining proceeds from the sales have been netted against exploration expenditures.

Liquidity and cash resources

As at Dec. 31, 2011, the company had cash and cash equivalents of $48.6-million and working capital of $29.0-million, as compared with cash and cash equivalents of $32.9-million and working capital of $31.2-million at Dec. 31, 2010.

Cash used in operating activities for the year ended Dec. 31, 2011, was $11.7-million, and consists mainly of the net loss of $18.7-million adjusted for the impact of non-cash items, including depreciation expense of $2.6-million and changes in non-cash working capital items.

Net cash from financing activities for the year ended Dec. 31, 2011, was $107.4-million, results from a private placement completed in February, 2011, and the completion of a $50-million debenture financing in July, 2011.

Net cash used in investing activities for the year ended Dec. 31, 2011, was $77.2-million for expenditures primarily related to the development of the Karowe mine. In conjunction with the development of the Karowe mine, the company has purchase commitments of $11.5-million and estimated remaining capital expenditures of approximately $35-million.

In February, 2012, the company received a commitment letter from Bank of Nova Scotia for a $25-million revolving term credit facility. Upon closing of the facility, the company intends to use the facility to finance continuing operations primarily at the Karowe mine in Botswana. The availability of the facility is subject to the completion of final documentation and customary conditions precedent. The two-year facility will be secured by the assets of the company and certain of its subsidiaries. Up to $15-million may be advanced prior to the delivery of security over the company’s Karowe assets.

Future plans and outlook

Karowe mine

The company is expected to complete construction of the Karowe 2.5-million-tonne-per-annum production facility in the first quarter of 2012. Commissioning, which started in January, 2012, will continue through the first quarter of 2012 with production scheduled to commence early in the second quarter. Ramp-up to full production will continue through the remaining of the second quarter of 2012.

The company expects to conduct the first sale of diamonds from Karowe at its dedicated sales and marketing facilities in Gaborone in the second quarter of 2012.

Mothae project

The company intends to continue with trial mining program and project evaluation through to the end of the third quarter of 2012. In the first half of 2012, efforts will focus on mining and processing of 30,000 to 50,000 tonnes of fresh unweathered kimberlite to determine the diamond recovery characteristics of this material, which makes up the bulk of Mothae’s resource potential.

The completion of the 5,400-metre delineation drilling program by RDS is anticipated in the second quarter of 2012 with subsequent geological modelling and resource estimation to be carried out by Mineral Servies Canada in the third quarter. In addition, during the third quarter of 2012, the company expects the completion of studies by ADP, which include mine design, detailed ore dressing studies to support process plant design and detailed costing of the required support infrastructure. A preliminary economic assessment would then be completed in the fourth quarter of 2012.

The company expects continuing diamond recoveries and periodic sales of Mothae’s diamonds during the trial mining phase.

Qualified person

Anthony George, PEng, a mining engineer, Lucara’s vice-president of development, is the company’s qualified person pursuant to NI 43-101 and has reviewed the technical contents of this news release

On February 15, 2012 the company reported long intercept results from their flagship Golden Summit property including 1.12 g/t Au over 102.7 meters and again on Thursday (March 15, 2012) reported additional results including 0.69 g/t gold over 127 meters.

To the average investor that only thinks in terms of grams per tonne, these results might seem average at best, but it’s these low grade bulk tonnage deposits that make big moves for investors.

Of course they don’t grab the attention of the markets like high grade drill results do, but if investors start thinking in gram-meters instead of grams per tonne they will start to uncover some great opportunities before the rest of the market does.

Want to know more about Gram-Meters? We talk a lot about it here.

Since mid January only 4,000 meters of the planned 20,000 meter program has been completed on the Cleary Hill and Dolphin zones and we are really excited about what the company finds below the current resource estimate.

Last summer Hole GSDC – 11-06 was drilled down the center of the current resource and reported mineralization throughout the entire 452 meter hole and remains open to depth with the last 4.6 meters averaging 1.3 g/t Au.

Drill Hole GSDC-11-06 Down the Centre of the Resource

The company continues to work with 2 rigs on the property to tie together the Cleary Hill Zone into the existing Dolphin Resource in the next resource estimate.

Lots of news flow, well funded, great projects,  good management, good shareholder base, and small market cap makes Freegold Ventures (TSX: FVL) a company worth watching over the coming months.