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Leonora

The Gwalia mine is located three kilometres south of the town of Leonora, Western Australia.  The operation continues the development of an ore body that has already produced four million ounces from open cut and underground operations.  The mine was originally established in 1897 by Herbert Hoover, who later became the 31st President of the United States.

Gwalia Mine

The Gwalia mine is the cornerstone of Leonora operations with 1.6 million ounces of gold in reserves at a grade of 9 gram per tonne and indicative mine life in excess of nine years.  After two years of re development, the first gold pour from the operations occurred in October 2008 and a year later, the first 100,000 oz milestone was reached.

Development is currently focused on extending the main decline, called the Hoover Decline, to enable the ramp up to full production in financial year 2012.  Production from Gwalia comes from a number of lodes with the production in financial year 2010 reaching 1260 metres below surface.  By financial year 2012 production is almost solely from the higher grade South West Branch lode which contains approximately 70% of the total reserve ounces.  To date the geotechnical environment has been well within design papmetres.

The processing plant is a conventional CIP circuit and operates on a campagin basis.  When operated on a full time basis, the plant has a nominal capacity of 1.2 million tonnes per year of hard rock and up to 1.8 million tonnes per year, when softer open pit material is blended.  Other surface infrastructure includes a gas-fired power station, a paste fill plant, and a refrigeration plant to cool the underground envirnoment.  Central to the mine ventialtion system is a 5.5 metre ventilation shaft, which at 800 metres long is the largest raise bored shaft ever drilled in Australia.  The accommodation village was significantly upgraded and expanded, incorporating a number of energy efficient and environmentally friendly initiatives.  The Camp recently received a certificate fo merit in the 2009 Golden Gekko Awards.

Production at the operation is forecast to grow from 83,000 ounces in financial year 2009 to 190,000 to 210,000 ounces in financial year 2012.

Tower Hill

Tower Hill, which is two kilometres from the Gwalia plant, has been identified as a potential underground opportunity with a reserve of 338,000 ounces, which includes several higher grade areas.  The project is capable of delivering approximately 2.5 million tonnes at 4.6 g/t for 350,000 ounces over six years.  The addition of ore to the Gwalia mill is expected to significantly reduce mill processing costs.  The project is currently subject to a full feasibility study with a decision expected in the March quarter 2010.

Tarmoola

Mine studies have indicated the potential for economic underground mining of higher grade gold lodes at Tarmoola, located 40 kilometres to the northwest of Gwalia at Leonora.  A JORC compliant mineral resource estimate released in October 2009 for the underground higher grade ore lodes identified Indicated and Inferred Resources totaling 2.0 million tonnes @ 6.0 g/t containing 376,000 ounces.  Subject to completion of a detailed feasibility study, the project is capable of delivering 1.5 to 1.7 million tonnes at 3.8 to 4.2 g/t for approximately 190,000 to 210,000 contained ounces over five years.

Expectations are that the ore is suitable for processing through the Gwalia mill with metallurgical recoveries expected to be in the range of 92-95% based on historical performance.

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