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## Meekatharra Operations 

## “Low grade stockpiles were depleted during the year and the treatment plant placed on care and maintenance pending a review of Paddys Flat underground resources and progress on establishing new open pit positions”. 

## Treatment Plant 

Mill throughput totaled 1.71 million tonnes, a decrease on the previous year due to campaign milling (two weeks operating – one week standby) during the second half of the year and cessation of operations in mid-May 2004. 

Mill feed comprised low grade material exclusively from Paddys Flat stockpiles No. 1, 2 and 3. Production of 37,985 ounces was close to the original 40,000 ounce estimate, allowing for the normal vagaries of reprocessing stockpiled material. 

The original concept of developing the low grade Batavia open cut to supplement throughput was deferred. 

On cessation of operations, trapped gold in the grinding circuit, pump hoppers and leach tank was recovered and the gold-in-carbon inventory reduced to minimum levels. 

Milling operations are suspended pending fi  nalisation of the Paddys Flat development strategy and establishment of additional open pit resources. A small maintenance (and security) crew is completing a thorough mechanical audit of the plant and refurbishing as appropriate. 

Capital expenditure during the year was minimal. 

The original strategy of completing fl  ow sheet circuit modi fi  cations to accommodate the processing of both soft open cut and harder Paddys Flat underground ore was deferred in favour of a reduced throughput strategy aligned with current known resources. 

Rehabilitation of the depleted Paddys Flat low grade stockpile location was essentially complete with only minor seeding outstanding. 

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## Paddys Flat 

The development of Paddys Flat underground resources is likely to be integral to the recommencement of production at Meekatharra. 

During the year, as part of the feasibility study, the Company completed a 30 hole (9,700 metre) drill programme at Prohibition and the adjoining Red Spider. 

The down plunge drilling increased the resource inventory by 170 percent to 270,000 ounces of gold. The combined resource estimate, calculated by independent Cube Consulting Pty Ltd using ordinary kriging, is 2.35 million tonnes at 3.6 g/t (at a 1 g/t cut-off) and 0.77 million tonnes at 5.2 g/t for 128,000 ounces at a 4 g/t cut-off. 

The estimate includes Red Spider, a new and well de fi  ned structure parallel to and shallower than Prohibition. 

The geological setting suggests Prohibition and Red Spider will continue to depth. 

A review of the increased, multi-zoned Prohibition resource and the updated Vivians resource identi fi  ed signi fi  cant opportunities to reduce underground development metres and resultant costs by repositioning the main Prohibition decline closer to the ore zones, and reducing the development necessary between Prohibition, Vivians and Consols resources. 

A base case pre feasibility study has now been completed. 

Cube Consulting has reviewed the high grade Vivians and Consols ore positions and identi fi  ed targets for investigation. 

