lomond reef

Lomond Reef Expanded

Announced by: GDR
Announced on: 17/11/2004 08:30:26
Words: 917
Status: Market sensitive (Y)
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17 November 2004
Australian Stock Exchange Limited
Company Announcements Office
Level 10, 20 Bond Street
SYDNEY NSW 2000
Dear Sirs Goldstar Resources NL (ASX code GDR, "Goldstar") is pleased to make the following announcement regarding Lomond Reef and the surface drilling program at Walhalla. The physical size of the Lomond Reef (the "Reef") has more than doubled following the second phase of drilling from the Long Tunnel Extended Chamber. The Reef now has a drill defined strike of 550 metres, a down dip extent of over 120 metres
and a thickness varying from 3 metres to 15 metres true width. The Reef as defined at the
end of September was only 350 metres by 80 metres deep (Fig 1). The second phase of the Long Tunnel Extended program has involved a further 780 metres
of diamond drilling from the single location in the Long Tunnel Extended Chamber. The
program was completed ahead of schedule due to continued good drilling performance.
Core recoveries for the second phase remained above 90% ensuring assay data will be at reportable qualities.

2 The continuity of the Lomond Reef that has been exhibited in this Phase II drilling is an important advance in the definition and expansion of the multiple reef system at Walhalla.
All holes have exhibited laminated quartz veining and associated dyke and stockwork
material. Assay data will become available over the next month and will be reported
accordingly. Further delineation of the Reef could not be undertaken from the Long Tunnel Extended due
to the limitation of the old workings. Consideration was given to developing another
underground drill site, however, it was shown to be more cost effective to drill further holes
from the surface. Surface Drilling With the Victorian Government's reopening of the regional forestry tracks at the start of
November, Goldstar Resources NL (Goldstar) has been able to commence site works in
preparation for the start of the surface drilling program. The preparatory works are
proceeding ahead of schedule and within budget guidelines. The selected drilling company has confirmed that it will deliver the drill rig to site towards the
end of November. While the drill rig will be on site as scheduled, the acute industry wide shortage of experienced drillers has meant that drilling will not now commence until the first
week in January. The first series of holes in the surface program (Fans 1 and 2) will target down dip and strike
extensions to the Lomond Reef, contained within the Cohen's North Target (Fig 2). The
Long Tunnel Extended drilling and the subsequent definition of the Lomond Reef has
significantly enhanced and expanded the Cohen's North Target. The surface drilling
program has been modified accordingly and will be further reviewed dependant on results
delivered from the earlier holes. Figure 2: Schematic of Surface Drill Program Site Locations