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Sino Gold's Sanjianfang and Eastern Dragon Projects are located in Heilongjiang Province in northern China,approximately 425km north of the provincial capital Harbin.
In 2005, Sino Gold formed a joint venture with No. 707 Brigade of Heilongjiang Nonferrous Metals Geology Exploration (“Brigade 707”) in relation to the Sanjianfang Project.
In early 2008, Sino Gold acquired an effective 72% interest in the nearby Eastern Dragon Lode 5 gold-silver deposit. Sino Gold also secured an exclusive right to acquire up to 80% of the surrounding Exploration Licence (53km2 in area) for a price to be determined by the end of 2008 |
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Eastern Dragon is a high-grade deposit that has potential to produce gold at less than US$100/ounce (including silver credits).
Exploration at Eastern Dragon has focussed primarily on Lode 5 which is a low-sulphidation epithermal quartz-adularia vein system with a near vertical dip. Gold-silver mineralisation in Lode 5 has been identified over a strike length of 600m and to a depth of 250m.

Brigade 707 has identified a resource to Chinese standards based on data collected from 45 diamond drill holes and underground development on two levels. Further confirmation work is required prior to reporting a Mineral Resource for Lode 5 in accordance with internationally accepted standards including Australasia’s JORC Code.
Sino Gold’s near-term conceptual exploration target is to verify and convert the Chinese resource to a JORC Code categorised resource of at least 600,000 to 800,000 ounces of contained gold potentially in the range of 7g/t to 8g/t gold and 70g/t to 75g/t silver, and 2.3 to 2.9 million tonnes.
Preliminary studies of Eastern Dragon Lode 5 indicate the following potential development scenario:
- Mining primarily via an underground operation;
- Simple carbon-in-leach (CIL) plant processing 300,000 to 500,000 tonnes per annum;
- Metallurgical recoveries of >90% for gold; and
- Gold production of 80,000 to 120,000 ounces per annum plus significant silver production.
During 2008, Sino Gold intends to:
- Convert and extend the Lode 5 identified resource to a JORC Code categorised resource by re-sampling, additional sampling and diamond drilling;
- Undertake additional metallurgical, geotechnical and mining studies;
- Progress required permitting;
- Progress acquisition of the surrounding Exploration Licence; and
- Commence drilling targets identified within the adjacent Sanjianfang Exploration Licence.
Eastern Dragon is an important part of Sino Gold’s growth strategy and is an asset that has the potential to be developed into a long-term, high-quality mine.
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