CLUNES

In this place, the quartz veins found by the miners of 1857 sustained gold production for more than 30 years. Drilling in past years by other companies showed that probing for extensions of those old and well-known veins is unlikely to disclose enough new gold to warrant re-development. Therefore -

The first prerequisite for new mine life is evidence of untapped auriferous quartz veins. Drilling by Mount Rommel in 2006/2007 proved these do exist. Here are two examples of what these gold-bearing vein intercepts reveal.

This drill hole intersection produced the evidence of gold of commercially interesting value in the upper and lower wall rocks of a zone 10m wide (138.4 to 151.2) in hole CD06-5. The photographs below reveal the nature of the cored intercepts in this flatter dipping zone (see diagram below)

"Live" auriferous veins are those where there is assay evidence of gold in the wall rocks of the vein zone. Along strike or down dip these wall rock zones have the potential to develop into ore, where gold occurs from wall to wall.

The second objective is to develop the size of each recent discovery, so the existence of ore in quantity becomes an evident fact.

For this task, the ability to drill gives an advantage over the miners of 1857. The guiding opinion of these early miners is to be found in the text accompanying the large Nordstrom model of Clunes (built 1858, and today in the Science Works Museum) which includes the observation -

......."The spaces between the (known) respective reefs are more or less traversed by numerous quartz veins, but which are mostly too poor and of too irregular extension to be worked either combined or separately with any advantage"......

The assay data from Mount Rommel drilling clearly demonstrates that localisation of gold in the wall rocks of particular veins has occurred in this space which lacked interest to early miners, or subsequent explorers.

It appears highly likely that the section of holes (CD06-4, 5 and 6, CD07-1 and 2) illustrated here have actually all intersected just the northern end of a zone with the potential to be profitably exploited.

The diagram shows a steeply dipping zone intersected four times and proving its extent over 100 vertical metres - a distance equivalent to any vein worked before 1880. Its existence is enough to generate a strong desire to find out more about this vein and how it might develop along strike. The same applies to the flatter-dipping structure in the hanging wall of the steeply dipping vein.

The whole of the historic vein pattern of the Port Phillip mine is indicative of gold being won from structurally controlled veins. The drilling intersections shown above are evidence of a similar reason for localisation of gold. The probability is that, consistent with evidence elsewhere in these old Port Phillip workings, the intercepts (2006/2007) now disclosed are likely to extend along strike for a considerable distance.

This explanation, if shown correct by further drilling, is likely to generate new ore of considerable value to Mount Rommel.

The practical steps to follow are these -

1. protect the right to future gold by making sure of title. Result - renewal registration granted 12 May 2010
2. obtain the proper approval from Government for a series of drilling programs. Result - Work Plan resubmission completed 20 July 2010
3. consider shareholders interests. Decision - offer Option holders the opportunity to extend the term of those Options, allowing more time for these current developments to unfold - a Board approval, 20 July 2010.
   

Fred Hunt
Chairman
contact us

Previous Chairman's Outlooks
24 June 2010
20 June 2010
8June 2010
2 June 2010
12 May 2010