Measured Resource of 154,500 tons from Waste Pile 1 which is high in halloysite. Indicated Resource of 603,380 tons from Waste Piles 2, 3, 4 and 5

          Waste   Acres   Resource   Volume  

% Yield
  Clay   Thickness   % Clay Content
Pile       Status   (cubic yards)   <5um   Tonnage   (feet)   Halloysite   Kaolinite   Illite-Smectite   Total
1   7.99   Measured   454,377   19.4   154,500   35   41.8   25.8   9.4   77
2   5.32   Indicated   358,549   20.2   127,100   42   19   33.6   27.8   80.4
3   13.1   Indicated   844,273   20*   298,900   40   9.8   30.7   24.9   65.4
4   1.8   Indicated   118,586   15.9   33,280   41   13.2   31.7   31.8   76.7
5   5.96   Indicated   215,744   21.6   144,100   39   13.5   31.8   36.5   81.8
TOTAL   34.17       1,991,529       757,880                    
* Waste Pile 3 - refined to <45 microns and <5 micron fraction estimated. % Clay content results for WP3 based on <45 micron fraction.

Studies on the commercial potential of the waste piles continue.
  • Overall Summary of clay resources (in tons*)
          Status   Area   Acres   Tonnage   Total
Measured   Dragon Pit   4.95   552,500  
Western Area 0.8 44,200
    Waste Pile 1   7.99   154,500   751,200
Indicated Western Area 5.33 776,500
    Waste Piles 2, 3, 4 and 5   26.18   603,380   1,379,880
Measured + Indicated       45.25   2,131,080   2,131,080

Total Measured and Indicated Resources 2,131,080 tons

Should the Waste Piles be utilised on a whole rock basis the Measured, Indicated and Inferred Resources will be as below:
          Reserve Status   Area   Acres   Tonnage   Total
Measured Resource   Dragon Pit   4.95   552,500    
    Western Area   0.8   44,200   596,700
Indicated Resource   Western Area   5.33   776,500   776,500
Inferred Resource   5 Waste Piles - Whole rock   34.17   4,525,898   4,525,898
Measure, Indicated, Inferred       45,25   5,899,098   5,899,098

Total Measured, Indicated and Inferred Resources 5,899,098 tons

(1 ton in this report is equivalent to 0.90718474 metric tonnes)

IRON ORE RESOURCES

Of thirty-six boreholes (5,914 ft drilled in 4.95 acres in the Dragon Pit area) thirty-two contained iron ore. Iron ore was encountered to below the 500 ft level and could well go farther on basis of iron being reported at 1000 ft adjacent to the old shaft. XRF was carried out on 87 core samples (and further samples from outside of pit area). The mineralogy is a mix of goethite, hematite and amorphous iron (identified as ferrihydrite). Some zones are high in goethite, which is a light to dark yellowish ochre, which will have applications as a pigment. A Measured Resource of iron ore in the pit area of 2,104,000 tons has been calculated.