Dear Shareholder
June 2003 Update
Following our Annual General Meeting, which was held in Melbourne on 27th May 2003, I am pleased to provide you with an update in respect of the Company’s key projects.
Cibaliung Gold Project – Banten Province, western Java, Indonesia
The Company holds a 75% interest in the Cibaliung Gold Project, which is a high grade epithermal gold vein system located 150km south west of Jakarta. The Company has recently announced an increase in the resources at Cibaliung and completed an updated preliminary feasibility study. The new resources amount to 1.21 Million tonnes @ 10.3 g/t gold and 88 g/t silver (Measured + Indicated) and 0.58 Million tonnes @ 8.3 g/t gold and 64 g/t silver (Inferred). These increased resources underpin the updated study along with improvements to the mining plan and a reduction in estimated costs.
Coupled with an improved US$ gold price, the updated preliminary feasibility study has given the Company a renewed confidence in the Cibaliung Gold Project. The Company expects to complete a bankable feasibility study within the first half of 2004.
Key findings of the updated preliminary feasibility study are:
- Mine life of 6 years with a increased production rate of 220,000 tonnes per annum with recovery of gold and silver by a conventional gravity - CIL processing plant;
- Annual production of approximately 70,000 ozs gold equivalent;
- Initial capital estimate of some US$ 30 million;
- Average life of mine cash operating costs of less than US$200/oz.
Mount Alexander Goldfields, Raywood and Sebastian Prospects – central Victoria
It is also pleasing to report that, as a result of investigations to identify new opportunities, the Company was successful in acquiring Mt Alexander Goldfields NL (“MAG”) in July 2002. MAG holds tenements to the south of the Bendigo goldfields in Victoria, and since acquisition, has also been successful in securing options over the Raywood and Sebastian prospects to the north of this famous gold district. Over 30 million ounces of gold have been produced from this area and it is acknowledged by the mining industry as highly prospective.
The Company’s aims in Victoria are to identify gold targets for drill testing at the earliest opportunity and to complete a project assessment to assist in determining options for the advancement of these prospects. The exploration targets are multiple shallow repeats of the Bendigo gold mines that typically contain 0.25 to 0.5 million ounces. Review of the historical database is yielding new information to prepare geological models to predict the position of likely new gold deposits within these project areas. Typical production grades for the quartz reefs in this area were 12 to 15 g/t gold.
The Company’s involvement in Victoria is a significant and positive achievement and one which has the prospect of advancing to feasibility in the medium to longer term.
With these developments your Company now holds projects in Indonesia and Australia which have both been materially advanced. Cibaliung offers the prospect of achieving the transition from explorer to producer in the medium term while our activities in Victoria through MAG represent an exciting new phase for the Company.
Annual General Meeting
This year for the first time the Company’s Annual General Meeting was held in Melbourne. This reflects the re-location of the head office to Melbourne following the Company’s acquisition of Mount Alexander Goldfields NL and the appointment of a new Managing Director Mr Ian Price. Ian is a mining engineer with over 30 years experience in operating mines and in developing new projects and he has been instrumental in leading the technical team that has now developed the Cibaliung project through to commencement of Bankable Feasibility.
I am pleased to also report that all motions were passed at the AGM and I acknowledge with gratitude the continuing support of our many shareholders.
I encourage you to view more details regarding the Company’s projects and all of the latest releases by the Company at our website: www.austindoresources.com.au
Yours sincerely
Pieter W. Greeff
Chairman
