Overview

Monday, 18 August 2008 18:57

The Indee Gold Project, Range River Gold’s major mining project, is located 80km south of Port Hedland within the Pilbara region, Western Australia. The Pilbara region has seen increasing gold exploration activity over the last few years. The appeal of the Pilbara region is twofold. Firstly, for its prospectivity which has been widely documented in recent times and secondly for its favourable proximity to Port Hedland and the associated infrastructure of the North West Highway and the existence of the gas pipeline. The recent exploration discoveries of De Grey Mining on our eastern boundary have further confirmed the prospectivity of the West Pilbara region for gold.

In September 2005 the Board resolved to proceed with the development of the Indee Gold Project, with the intention of commencing mining operations during the first half of 2006.

Range River Gold acquired its initial interest in the Indee Project in September 2003 and by the end of February 2004 had earned a 70% interest in the project.In April 2005 the Company announced that it had signed an agreement with Bullion Minerals Ltd to acquire Bullion’s 30% joint venture interest in the Indee Gold Project and which was approved by shareholders at an EGM on 31 May 2005

The project covers approximately 800 square kilometres. Seven main prospects have been defined within the region, with Camel 1 and Withnell the most intensely drilled to date and both now contain Measured and Indicated Resources.

The geology of the region consists of a sequence of Archean aged turbidite sediments intruded by two main large granitic bodies and smaller granitic plugs.Slate belt mineralisation in the turbidites is confined to a major structure, the Mallina Shear, an east-west trending multiple shear zone extending over 80 kilometres on the Company’s tenements and up to 2kms at its widest point.

Activities Since Acquisition

After acquiring the Indee Project and defining the parameters of a pre-feasibility study, a 13,000 metre RC drilling program was conducted and completed during October 2003.

Following the success of Stage 1, the Stage 2 Resource Drilling Program commenced in March 2004. In August 2004 the final set of drilling results from this infill drilling program were announced.The drilling program comprised 18 diamond drill holes and 440 RC drill holes for a total of 30,533 metres within the key 8km mineralised zone. The additional drilling confirmed the continuity of the ore grade mineralisation at Withnell and Camel 1.It also established new areas of shallow mineralisation at Withnell and extended the strike length of the mineralised structure at Camel 1 to 400 metres.

Range River Gold reached an important milestone in September 2004 when a Native Title agreement was signed with the Kariyarra people, traditional owners of the land. This ultimately provides all the requisite native title approvals for the future development of the Indee Gold Project.

Resource infill drilling completed during September 2004 was part of an oxide delineation campaign targeting near surface mineralisation over a selected strike length of 400 metres at Withnell and Withnell South. The drilling focused on near surface oxide mineralisation at Withnell and targeted further resources at Withnell South, Roe and Camel 2. The drilling indicated the potential to add to the existing overall oxide resource.

Map: Indee Project
Table: Significant Intersections

The Company completed a further oxide delineation program which added additional oxide resources to the Withnell-Camel resource base during November and December 2004.During 2005, the Company made several significant purchases including a crushing and stacking system, absorption tanks and an agglomerator. Construction of the elution plant also commenced..

The resource at commencement of operations was 10.46MT at 1.6 g/t Au for 529,000 ounces. Of this amount, 216,000 ounces were within the oxide zone with 169,000 ounces at Withnell and Camel 1 categorised as Measured and Indicated. Oxide ore represented approximately 4.2 million tonnes grading 1.6 g/t using a 0.5 g/t Au cut off. This cut-off level was selected to suit the mining and metallurgical parameters of the development options being considered. The October/November 2005 grade control and resource extension drilling program has established further high grade ore zones at Withnell South and East pits which provided encouragement as the Company moved towards gold production.

The sulphide resource contains a total of 313,000 ounces. The bulk of this material occurs at Withnell where the Measured and Indicated resource totals 4.38 million tonnes @ 1.6 g/t Au using a cut at 0.5 g/t Au.

The Company established an initial operation leading to mining and processing of the oxide gold resource. The economic rationale was to develop the Indee Gold Project in stages to optimise the grade and metallurgical parameters of the various ore types. At a later stage, the Company increased to expand the operations by processing other economic oxide ore and sulphide ore which contains the majority of ounces delineated to date.
In September 2005 the Range River Gold Board decided to wind down operations over the period of the first half of the 2008 calendar year. Mining was completed on 22 November 2007 and crushing to heaps completed on 8 December 2007.

Irrigation of the heaps will continue until the last quarter of the 2007/08 financial year. The mine will be put on care and maintenance after the completion of operations.
A review of the critical issues that impacted upon the profitability of the Indee project is being undertaken with a view to developing a plan to realise the potential of the Indee Gold Mine. This plan is expected to be completed in the last quarter of the 2007/08 financial year.