Dutch Gold Resources Releases Letter to Stockholders
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ATLANTA, GA, Jan 15 (MARKET WIRE) --
Dutch Gold Resources, Inc. (PINKSHEETS: DGRI), a developer and operator of
proven gold mines and a regional mill in North America, today released a letter
to stockholders from CEO Daniel W. Hollis.
The text of the letter in its entirety is contained below:
Dear Fellow Stockholder,
On behalf of the Board of Directors, management team and staff, it is my
privilege to update you on the progress that we have made at Dutch Gold
Resources, Inc. during 2007 and outline our vision and strategy to grow
thecompany. We believe that Dutch Gold is in the right business, at the
righttime, with the right people and the right mines.
The past year marked a period of transformation and change for Dutch Gold.
Following the acquisition of Dutch Mining, LLC in January 2007, we
improvedthe company in many ways while strengthening our financial position.
-- We made key investments to upgrade our equipment, workforce and
infrastructure.
-- We found new ways to increase our precious metal recovery rate.
-- We took measures to improve our cost structure and establish Dutch
Gold as a credible, consistent and profitable gold mining company.
Operations Review
Throughout 2007, we strengthened our infrastructure via major investments in
new
tools, equipment and heavy machinery. We anticipate our commitment to
modernizing
our operations should maximize the long-term value of our mining assets by
reducing our cost per ounce of production.
High precious and base metals prices have resulted in tremendous
industry-wide
demand for drilling equipment and specialized mining apparatus. We believe
Dutch Gold's strong and well-connected management team has given the company an
advantage in procuring and placing the following key equipment into service
during 2007:
-- In May, we installed a Knelson Concentrator at the Merlin mill to more
efficiently process the free gold we discovered.
-- In June, we further enhanced the ore recovery circuit at the mill by
installing a new Gemini table. Tail values have decreased considerably,
indicating that the equipment is performing per specifications.
-- In September, we installed a 24" Telsmith Cone Crusher with an
advanced magnet system and double deck screens, which reduces our average
particle size to less than half an inch. This modification will decrease
our maintenance costs and further reduce downtime. Our mine also took
delivery of a brand new, highly coveted Hagby Onram 1000/3 diamond core
drill. The drill represents an important victory for Dutch Gold since such
drills are currently hard to procure with wait times often greater than one
year.
-- In October, we began operating a new assay lab on site. With the new
lab in operation, we will be able to analyze ore grades within 24 hours,
thereby providing the mine and mill with swift, accurate and valuable
information.
The above equipment upgrades, combined with the hard work and
determinationof our staff, have resulted in a current mill capacity of 330 tons
of ore per
day.
Our Company Is Our People
Production at the historic Benton mine in Southwest Oregon resumed in
March2007 and the company has been shipping gold concentrates on a monthly
basisever since.
Getting to this point was no small task. In our industry, a shrinking
talent pool
has led to a decade-long shortage of miners, engineers, mill workers and
geologists with the experience and expertise needed to execute our plans. Our
general manager, Patrick Engel, along with mine superintendent Tim Hunter and
mill superintendent Fred Wilcox, have done a phenomenal job of recruiting
some of the best talent in the industry away from our competitors.
These workers were attracted to Dutch Gold by the Benton mine's proven
production history, our exciting growth plans, and our willingness to invest
in the training and tools to bring out their best. We believe the new hires
recognized us as a promising employer with a bright future. Dutch Gold has been
successful this year because of dedicated teamwork.
Dutch Gold is committed to providing a safe work environment for all of
ouremployees. An excellent safety performance record is an important company
asset
and will result in reduced insurance premiums. We have invested heavily in
modern
safety equipment, training and certification this year in order to keep
abreast of MSHA safety regulations and reporting requirements. We also require
employees to submit to drug testing in advance of hiring, and remain subject
to random testing during their employment.
We are committed to never sacrificing safety in order to cut costs. We take
safety very seriously, and our safety efforts are yet another quality that set
us
apart from the competition, while enhancing the value and credibility of
Dutch Gold's reputation in the eyes of the marketplace and employees alike.
One very important addition to our team this year was the July appointment
of James
L. Browne to our Board of Directors. Mr. Browne is a highly regarded geologist
with extensive expertise in conducting property evaluations, geological analysis
and ore reserve definitions. In this highly competitive environment, the
demand for expert geologists like Mr. Browne is enormous. We are very
fortunate to have attracted him and believe he will play a vital role in
helping us to better understand the nature and occurrence of our
mineralization. In turn, we believe this could lead to a dramatic increase to
our proven and probable resource base at both the Benton and Gold Bug mines.
Short-Term Goals (1st Quarter 2008)
While we are pleased with our accomplishments to date, several key tasks
remain
to be completed in the near future:
-- Achieve full-reporting compliance with the Securities and Exchange
Commission, including the release of audited financial results, in order to
become more transparent to the financial community.
-- Apply for quotation of our shares on the Over-The-Counter Bulletin
Board.
-- Announce the results of our summer drilling program.
-- Further develop the Benton mine.
-- Evaluate additional properties for potential acquisition.
-- Continue to build relationships with investors and expand Dutch Gold's
presence among resource analysts and professionals.
2008 Objectives
-- Place the Texas mine and the Gold Bug mine into production.
-- Further develop the Benton mine and other associated vein structures.
-- Safely and responsibly produce 15,000 ounces of gold, generating
potential cash flow with anticipated EBITDA of at least $6 million for the
full year.
-- Expand our resource base and update our proven and probable reserve
report.
-- Participate in several gold trade shows annually.
-- Advance our strategy of acquiring other proven gold-bearing mines that
can be placed back into production.
-- Continue to attract, retain and reward the industry's top talent.
-- Maintain a passion for excellence -- plan, schedule and execute.
In Conclusion
We believe Dutch Gold Resources is well positioned for the future. Spot
prices for several base and precious metals have broken into record-high
territory
and gold prices recently traded above $900 an ounce. Although we cannot
forecast the price of gold in 2008, we anticipate our business would still
become quite profitable even if gold prices declined from current spot prices.
It is important to note that our mines have a proven historical track
record,
and that more than 85 percent of the total potential mineable area remains
unexplored. Our gold-bearing quartz veins are symmetrical and free of harmful
metals such as arsenic and lead, which means that we can process the ore in a
more environmentally friendly manner. Finally, the skill, determination and
dedication of our workforce remain a critical strength that sets us apart from
the
competition.
Thank you for the confidence and trust that you have placed in Dutch Gold
Resources, Inc. Although much hard work lies ahead, our entire team remains
focused on the creation of long-term value for our shareholders. Through
operational
excellence and the continued pursuit of our vision, we believe we are well
on our way towards achieving our goal of building Dutch Gold into one of the
premier gold mining companies in the Pacific Northwest.
We appreciate your loyalty and support, and look forward to working
diligently
towards rewarding your commitment in the years to come.
Respectfully Submitted,
Daniel W. Hollis
Chief Executive Officer
About Dutch Gold Resources, Inc.
In January 2007, Dutch Gold Resources, Inc. acquired Dutch Mining LLC, which
was founded in 1994. Dutch Gold is engaged in the mining and processing of
proven gold reserves in North America. The company's strategy is to focus on
overlooked resources which can be quickly and cost-efficiently brought into
production. The Company currently owns two mines in Southwestern Oregon,
consisting of the Benton and Gold Bug mines. Production resumed in March 2007
and the Company has begun a drilling program to prove up additional reserves and
enhance future production. Please visit the Company's website for additional
information at: www.dutchgoldresources.com.
The statements made in this document contain certain forward-looking
statements. Words
such as "expects," "intends," "anticipates," "plans," "believes," "seeks,"
"estimates" or variations of such words and similar expressions, are intended to
identify such forward-looking statements. The forward-looking statements
contained in this release may involve numerous risks and uncertainties, known
and
unknown, beyond the Company's control.
Such risks and uncertainties include: the ability of the Company to
developits products; the overall, global market for gold and precious metals,
future
actions by regulatory agencies; overall economic conditions; general market
conditions; price increases of gold and other precious metals; foreign currency
exchange rate fluctuations; as well as the risk factors listed from time to time
in the filings of Dutch Gold Resources, Inc. with the Securities and Exchange
Commission. Consequently, actual future results may differ materially from the
anticipated results expressed in the forward-looking statements, and
investors are cautioned not to place undue reliance on the forward-looking
statements included in this address.
Contact:
David K. Waldman
Klea K. Theoharis
Crescendo Communications, LLC
(212) 671-1020
Copyright 2008, Market Wire, All rights reserved.
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