CHAIRMAN'S OUTLOOK
(17 July 2008)

CURRENT FIELD ACTIVITY

These two photos were taken at Allendale EL 3821 on Thursday (17 July 2008). The composite picture, with the large red Schramm T660W Rotadrill on the left hand side of the photo, looks south to Springmount, with Stag Road immediately behind the drill rig.

The second photo shows the smaller white diamond drilling rig on the truck, same location (see explanation below).

The Schramm rig came on site on Wednesday (16/7). It left the site noon Thursday. The purpose was satisfactorily accomplished in a short time - to retrieve the inplace casing, hole H4, then to ream the already completed bore hole rapidly, using a 5½ inch hammer bit, down to base of existing hole at 109 metres.

Moving off, the smaller rig came to the H4 hole, quickly inserting the HQ casing into the reamed hole. Tomorrow, new coring should begin, to deepen hole H4.

To recap - the purpose here is to probe vertically into the centre of the apparent IP geophysical anomaly, only to the limited depth of 150m vertical. This depth would not bottom the anomaly - it is a probe for investigative purposes.

Directors are satisfied that this IP geophysics has been confirmed by proper off-set re-tranverse checks, and is coincident with a clearly defined zone of lesser resistivity.

These geophysical characteristics are interpreted due to sulphides. There is some evidence of associated gold (at geochemical levels) in nearby hole H5.

This location has no quartz mine history. More information as it comes to hand.

PREVIOUS CHAIRMAN'S OUTLOOK
(9 July 2008)

RECENT ACTIVITY

Some points to consider (and see pictures below).

Q. What style of Victorian gold deposit has been shown to bring significant prosperity?

A. One where the reef systems have portions enriched in gold. (Why search for anything less?).

The effort to find “A”-category gold ore under the lava cover by way of underground workings – as in the past – is not sensible today. Too often in Victoria 's past it has resulted in market disappointment. There were rare, sparkling market successes – see the production from Ballarat West (1879), from Sebastopol (1886), and also briefly from Glenfine South (1899).

The answer “A” is also written – those places where the gold is recoverable with lesser effort in shorter time –a direction to interest the Company in the sands at Glenfine South.

Licences held by this Company were selected to be in positions thought to have potential to result in answer “A”.

GLENFINE SOUTH (MIN 5492, 80%)

The objective is to recover gold. If the “ore-body” is sands on surface, semi-prepared, so much the better!

Q. At Glenfine South, why is it that gold is still sitting there in year 2008?

A. Probably, when first mined and treated, the discrete minerals auriferous arsenical pyrites and arsenopyrite went out in the tailings to waste, where that waste sits today. Weathering oxidises sulphides, and over 100 years appears to have liberated the gold in-situ in the waste sands. The “ore” for re-treatment (planned) is that one-third portion of the larger area of sands having high arsenic values on analysis. Remediation of those particular As-rich sands opens the route to gold recovery at Glenfine South.

Tube sampler - twist and push down, retrieve, use inner rod to eject sampled portion, and repeat to max depth one metre		Tube sampling of sands presently covered by bull-rushes		Sampling of oxidised sands below the rushes "L2" - gold 2.07 ppm, arsenic 1730 ppm
No growth in this severe sands environment Sample location "L6" depth 1m gold 2.27 ppm, arsenic 1792 ppm		Raw sands environs, showing water on surface ponding after rain.

ALLENDALE (EL 3821, 100%)

The difficult task in this licence area has been to significantly tighten the area open to prospective search, to better define that part of EL 3821 where exploration dollars might have an improved chance to produce worthwhile results. The efforts to overcome the difficulties of a lava-covered terrain, as here, were materially advanced in August 2007, and since – see below.

We can note why this licence first was taken out, and why it continues to be so firmly held by the Company.

The whole of the Madame Berry system of deep leads was an outstanding Victorian gold-mining success for three decades. The profits made historically by companies winning gold from these buried rivers is the stuff of legends. The source rocks (it is thought) must be hereabouts under the lava, and would, when found, probably be similar in character to those found in similar environs at Ballarat West.

Q. What does the State Geological Survey say about the location of this new prospective interest in EL 3821?

A. See pages 61, 62, 68, 83, 84 in GSV Report 117 (year 2000) in which authors D. Taylor et al point out that –

•   Meridional belts of quartz veins, many of which contain gold, seem to be important to discovery and refers for example, to lines of quartz veins that occur along the ... Monte Christo anticlinoria, and while the anticlinoria which hosts the Ballarat East gold field appears to die out going north towards Creswick/Allendale, the Monte Christo line continues host to small deposits.
  
• “Reefs in the hinge zone of the Monte Christo anticlinorium in the headwaters of the Berry leads are uncommon despite evidence of significant prospecting in the area.” (- people continue to search!)
  
• Figure 46 of GSV Report 117 (page 84) shows that directly along strike northwards from the Monte Christo anticlinorium is where the zone of new prospective interest is positioned , hidden by the lava cover – see map below.

At Allendale, the steps taken in 2007/2008 have been to use ground geophysics, followed by probe drilling, and observation. Geochemical analyses of drill products provided another dimension, assisting in ongoing target definition.

The bleaching, iron carbonate in slate, and isolated crystals of arsenopyrite in sandstone of the core, the bottom of probe hole H4, is reason enough to continue this vertical probe hole beyond the present depth of 109 metres, to at least 150 metres.

Drillers have notified Directors that the required extra equipment has been delivered, and drilling in hole H4 should resume again shortly.

The Stag Road target found first in August 2007 remains enticing. Continued probing in hole H4 represents a beginning, it seems. Altogether, the most recent drilling revealed a bedrock ridge : we can be sure that had the old miners been aware of such a ridge with minimal lava cover, it would have had their attention years ago. Today it offers scope as a newly defined prospective zone in a key location, related directly to the erosion zone in the headwaters to the Madame Berry system of deep leads.

PRESENT AGENDA FOR DIRECTORS

• Consider and use for permit application purposes the heritage consultant report on Glenfine South, just received;
  
• completion of statutory reports to DPI, required as a condition of licence issue;
  
• obligations to be met in satisfaction of public company audit to 30 th June, 2008 , and annual report preparation.

	The headwaters of the Madame Berry system of deep leads.
	Along the trend of the Monte Christo anticlinorium (see Fig. 46 at left) and some 16 kilometres south of the area presently being drilled in EL 3821 (at Stag Road) is the area of intense gold mineralisation, the LITTLE BENDIGO GOLDFIELD. This field is the north-east part of the Ballarat goldfield. Not covered by basalt, erosion over geologic time distributed gold from the marked reefs. The question has always been – given similar levels of erosion either side of the Great Divide, just what is hidden further north, by the lava covering the headwaters of the Madame Berry?
	LITTLE BENDIGO GOLDFIELD This map is an extract of Bulletin No. 62, published as Map No. 6 Ballarat, in GSV Report No. 94 (Finlay and Douglas, 1991).                     At the extreme south end of the Monte Christo anticlinorium (as the map shows) are the old workings of the Metropolitan mine (not an area held by the Company). This illustration is included here to convey to readers some idea of prospective character.
	This sketch is modified from T.A. Rickard (1900) ….. “The Metropolitan lode, illustrated Figure 12, occurs in an adjacent portion of the Ballarat district (Nereena). It has, on a large scale, certain of the features which characterize the geological structure of the Indicator series….. The Metropolitan lode consists of a series of spreading quartz-seams, to be considered as branches thrown out by near -vertical veins as in B D of sketch) traversing a wider band (A B, C D) of thinly bedded slates and sandstones, and dips slightly westward from the vertical. This band, which is enclosed by a series of massive beds of sandstone, forms a lode , or lode-channel , 80 feet wide in which the quartz seams earlier referred to rarely exceed 7 or 8 feet in thickness, and having an easterly dip, cross the bedding almost at right angles….etc.” The reference to this illustration is Rickard, T.A., The Indicator Vein, Ballarat , in Trans. Amer. IMM&PE Vol. XXX (1900) pp. 1004 to 1019, presented by this author in August 1900. In this paper Rickard states his visit to this mine (where he made the drawing) took place in January 1898. A similar drawing appears in GSV Memoir 4 (from a report on the Little Bendigo Goldfield by H.S. Whitelaw) reproduced in GSV Report No. 94 (1992).

Fred Hunt
Chairman
contact us