ashburton >> looking for funds again

the project seems to be ok
but
one wonder the price of the new issue
for sure market makers are working
opinions please
corporatescreeners
Secures $1.5m debt facility/Testwork on Wirralie

Document date: Tue 17 Jun 2003 Published: Tue 17 Jun 2003 11:26:08
Document No: 238992 Document part: A
Market Flag: Y
Classification: Issued Capital - Other , Progress Report
ASHBURTON MINERALS LIMITED 2003-06-17 ASX-SIGNAL-G

HOMEX - Perth

+++++++++++++++++++++++++
Ashburton Minerals Limited today announced that it has secured a $1.5
million debt facility from Macquarie Bank Ltd that substantially
advances the Company's planned acquisition of the Drummond Basin gold
project in North East Queensland from Placer Dome Asia Pacific.

The Company also announces that it has received an interim report
from independent hydrometallurgists Intec Ltd, confirming a gold
recovery of 93.3% from concentrate of Wirralie sulphide ore.

Ashburton has previously announced that it has reached an agreement
with Placer to acquire the Drummond Basin Project, which hosts the
Wirralie mine. An Independent Technical Report from RSG Global
indicates that the Wirralie mine has the potential to support an
83,000 oz oxide resource open pit mining operation over a two year
mine life.

Ashburton is acquiring the Drummond project because of the
opportunity to generate early cash flow by recommencing gold mining
operations at Wirralie. The Wirralie oxide resource has the potential
to deliver an operating cash flow of almost $12 million over a two
year mine life at a gold price of A$550/oz.

Under the terms of the debt facility, Macquarie has agreed to issue
Performance Bonds for the Drummond project up to a limit of $2.75
million, of which it has agreed to debt fund $1.5 million.

Ashburton Managing Director Tom Dukovcic said that the debt facility
was a vote of confidence in the Company.

"Securing this facility indicates the growing appreciation that
Ashburton has an opportunity to achieve substantial profits from a
project not suited to the big companies," Mr Dukovcic said.

To fund the Drummond acquisition and subsequent mine implementation
studies, Ashburton is seeking to raise $4.5 million through a
combination of debt and equity.

"Having secured $1.5 million via debt, the Company is now able to
finalise the details of its Prospectus to raise the remaining $3
million," Mr Dukovcic said.

In consideration, Ashburton will issue Macquarie with call options to
the value of $500,000, exercisable at the prospectus raising price
and expiring 30 June 2006. Any options exercised will be offset
against the debt facility.

Laboratory testwork results reported by Intec Ltd have indicated a
gold recovery of 93.3% from concentrate of Wirralie sulphide ore.

Mr Dukovcic said that while the laboratory testwork was positive, it
would be several years before mining of sulphide ore is required.

"Our development plan is to begin mining the relatively straight
forward oxide resource while using the time and the cash flow to
expand the sulphide resource base.

"During this period, we will also aim to refine the optimal
processing route for the sulphide resource, preferably one with a low
capital requirement and low ongoing operating costs," Mr Dukovcic
said.

Metallurgical testwork on Wirralie refractory sulphide ore is
continuing at both Intec Ltd in Sydney and at MIM Ltd's
Hydrometallurgical Research Laboratories (HRL) in Brisbane.

Intec has developed the Intec Refractory Gold Process ("IRGP"), a
halide-based process operating under atmospheric pressure and
moderate temperature. Importantly, the oxidation of the sulphides and
the leaching of the gold take place in the one process, representing
potentially significant savings in cost and time.

During the Intec trial, sample material was ground to a P80 of 30
microns. Intec reports that no attempt was made to optimise either
extraction efficiencies or leach retention times and with further
testwork both higher extraction efficiencies and lower leach
retention times are likely to be demonstrated.

The IRGP results from the Wirralie concentrate sample are shown in
the table below.

TABLE 1. WIRRALIE SULPHIDE ORE REFRACTORY CONCENTRATE

ELEMENT ASSAY EXTRACTION EFFICIENCY

Au 29.2g/t 93.3%
Ag 10.5g/t *95%
As 0.61% 98.1%
Fe 16.9% 97.1%

(* = greater than 95%)

Ashburton and Intec are involved in discussions which could see
Ashburton being the first Australian company to carry out detailed
metallurgical studies at Intec's pilot-scale plant, currently under
construction, in Sydney in early 2004.

Intec Managing Director Philip Wood said:

"The IRGP is a one-step process that operates at atmospheric pressure
and moderate temperature with low retention times, delivering
significant cost saving benefits in the recovery of gold from
refractory ores with important environmental advantages."

Additional testwork on Wirralie sulphide material continues to be
undertaken by HRL using their Albion Process.

For further information, please contact:

Tom Dukovcic
MANAGING DIRECTOR
08 9321 6600