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Mar 2005 - Goldstar Resources

Goldstar Resources NL (GDR) – Aiming to Start Trial Mining by April 2006

  • With four gold companies having market caps greater than A$100m in Victoria as shown in Table 1 on page 4 of this report, and all of them expecting to be in production by June 2006, Victoria has become a “hot-spot” from a share market perspective.
  • Walhalla was one of the richest of the Victorian goldfields, producing 1.5moz from 1.43mt (average of 33g/t) between 1864 and 1914, and Goldstar is aiming to start trial mining of its newly discovered Lomond Reef there by April 2006. Should the trial prove successful, Goldstar could attain a market cap of A$50m to A$100m based on production of 50,000ozpa to 100,000ozpa (especially when it is compared to other expected Victorian gold producers in Table 1).
  • GDR’s Lomond Reef lies behind and adjacent to the renowned Cohen’s Reef of Walhalla, and so far GDR has delineated about 1.1mt of mineralisation based on dimensions of 550m long on strike by 120m high by an average of 6.5m thick (it in fact varies between 2m and 12.5m thick). A mineralised 1.1mt ore block at a grade of 7g/t or 12g/t could contain 250,000oz to 450,000oz (and possibly contain higher grade shoots up to ~25g/t based on historical mining by the Royal Mint Company).
  • Current step-out drilling to the North has already extended the dimensions of the Lomond Reef by a further 100m on strike and 50m at depth (or a northern block 100m long by 170m high) for an additional 300,000t of mineralisation, and conceptually the potential resource could be extended to 2.2mt and still be open, north, south and at depth. Once the existing campaign to the north has been completed, step-out drilling to the south begins.
  • In addition to the Lomond Reef, GDR is also focusing on the second main feature of the field – namely dyke bulges with drilling results from the Black Diamond dyke bulge – fissure lodes system on the West 1 Structure (immediately west of Cohen’s) expected in the second half of 2005.
  • Written by: Keith Goode
  • Friday, 04 March 2005