Snake Well (Giralia 100%), Western Australia

Giralia holds 100% interest in the Snake Well project, which covers approximately 45 kilometres of strike of the Archaean Tallering greenstone belt in the Western Murchison Province, 450 kilometres north of Perth in Western Australia. Exploration to date has outlined a 170,000 ounce shallow gold resource.  within 2.84 million tonnes @ 1.9 g/t gold at Snake Well, in lode mineralisation and near surface laterite hosted mineralisation.

The Company is conducting scoping studies into a low capital cost start-up mining operation based on gravity and heap leach treatment of Mixy and the nearby Lop and Buckshot laterite deposits, to provide early cash flow without the initial need for the substantial investment required to establish a conventional CIP/CIL plant at Snake Well.    

Snake Well Project Resources at 30 June 2006

Further significant resource upgrades at Snake Well are considered likely with on-going drilling of the open ended 'Mixy' lode, and further drilling at other defined targets. Additionally, first pass RAB/aircore coverage has defined 5 new targets for follow-up.

a) Southern Mafic Zone

The southern half of the poorly exposed Tallering greenstone belt at Snake Well comprises a 2-3 kilometre thick zone of mafic rocks and banded iron formations. RAB drilling across a prominent buried magnetic unit shows strong gold anomalism over 30 kilometres of strike with intersections including 31 metres @ 2.08 grams per tonne gold and 4 metres @ 26.7 grams per tonne gold from 'Rabbit Well', 17 metres @ 3.14 grams per tonne from 'ASP', and 12 metres @ 1.31 grams per tonne gold from 'Armstrongs'.

Follow up reverse circulation ("RC") drilling within the 2 kilometre long 'Rabbit Well' anomaly has returned gold resources in the Inferred category as follows:

• Mixy: 590,000 tonnes @ 3.0 g/t, incl, 150,000 tonnes @ 6.9 g/t Au
• Calisi 1: 220,000 tonnes @ 2.1 g/t
• Calisi 2: 165,000 tonnes @ 1.7 g/t

from a series of quartz vein lode systems in sheared mafic rocks.
Additionally, drilling of gold mineralised laterite gravels has defined near surface resources at the 'Lop', 'Buckshot', 'Warren' and '1080' zones at Rabbit Well (total 835,000 tonnes @ 0.9 g/t Au, including  280,000 tonnes @ 1.32 g/t Au) to 15 metres depth.

Gravity metallurgical testwork completed at ConSep Pty Ltd in NSW, on a bulk sample of large diameter drill core from Mixy lode, returned exceptional gravity recoverable gold ("GRG") (95.4% GRG) – one of the highest results ever recorded at Consep, suppliers of gravity gold recovery equipment, including the Knelson Concentrator.  The recovered gold (calculated head grade 10.3g/t Au) of the Mixy sample significantly exceeded the assayed head grade of 6.93 g/t Au.  These results have significant implications for development costs at Snake Well, with suitable scale gravity recovery plants available for around 10% of the cost of conventional cyanidation plants.

Metallurgical testwork on excavator bulk samples and large diameter PQ diamond core also confirm heap leach amenability of the Lop and Buckshot laterite zones  which are located within several hundred metres of the Mixy lode. Recoveries of 63% and 69% respectively were returned at -6mm feed crush size following up earlier testwork on atypically low grade samples which had returned h

The 'Asp' anomaly, 6 kilometres west of Rabbit Well, hosts high order RAB anomalism over 1.6 kilometres strike. A new zone of laterite mineralisation was also identified at Asp in late 2003 (200,000 tonnes @ 0.9 g/t Au).
Additionally, the 6 kilometre interval of the magnetic unit between the 'Asp' and 'Rabbit Well' anomalies clearly requires further exploration, as do the Armstrongs anomaly and the Royal Standard lode (past production 68,000 tonnes @ 13.1 g/t Au).

b) Northern Felsic Zone

A felsic volcanic sequence in the north of the greenstone belt hosts both gold and VHMS style zinc mineralisation.
At the 'A-zone' deposit, an Indicated and Inferred Resource of 795,000 tonnes @ 2 grams per tonne gold (to 100 metres depth) for 51,000 ounces of contained gold remains open at depth within pyritic, quartz veined felsic schists with strongly elevated base metal values.

At the 'Conquistador' Joint Venture, Zinc Co Australia Limited can earn up to 75% interest in an area where RC and diamond drilling has returned intersections including 4 metres @ 8.2% zinc, 0.63% lead, 0.52% copper, 20.5 grams per tonne silver and 2.4 metres @ 12.15% zinc, 0.63% lead, 0.64% copper, 27.5 grams per tonne silver and 0.4 grams per tonne gold. Mineralisation occurs with a 2.5 kilometres long base metals anomaly, associated with a sulphidic chert horizon, and is interpreted as the possible distal expression of a VHMS massive sulphide system. Giralia retains gold rights.