Good afternoon lucky 992Thank you for your input regarding...

Good afternoon lucky 992

Thank you for your input regarding possible contributions to the delays in the drilling progress. Your explanations are correct and plausible especially when drilling shallow targets within the 200m range, it would be easier, cheaper, and more expedient than spending time and effort in testing for proximal peripheral targets following collapsed or blocked holes at these depths. If hole breakdowns occur below these depths, my experience showed that by-passing blockages with deviation tools similar to those used in the oil patch, will always reduce costs of drilling and reduce time by avoiding drilling a new hole, especially if the targets sought are in excess of 400 to 600m in depth and displacement of the target is within a maximum distance of say 60m maximum, which seems to be the EM detection limit shown by the down-hole surveys at Mt. Alexander.

Admittedly in the case of MAD184, the blockage is around 350m depth but you would need two new holes comprising some 700m of drilling to test the 49000 and 16000 Siemen anomalies, at say $120 all up cost / m, that amounts to a significant saving with no guarantees that the same problems will not be encountered.

I agree that tripping rods up and down can be time-consuming and sometimes risk doing damage to the hole and bogging big lengths of rod string etc. Again, in this case, judging from the little core we have seen in report photos, it appears that the host rocks comprise reasonably hard and competent granites, acid volcanic, and mafic/ultramafic lithologies. The problems here I think arise along the structural contacts between these lithologies causing slippage and faulting with associated pug development contributing to the type of blocking we are seeing in MAD184. I also suspect that these fault structures will, as I mentioned above, present problems in the planned new distal holes 30 or 50 m away from MAD184 if the same lithological contacts are intersected in these holes.

Again, because of the competency in the lithologies, I think the fault zones will be reasonably narrow and, in most instances, they will be amenable to proper cementing and directional drilling techniques. SGQ will find deeper anomalies along the 16 km strike and in time they will need to resort to directional drilling from a mother hole in order to expedite progress and keep costs down. Incidentally, pulling 12m lengths when tripping rods is not an uncommon practice with deep holes, we were doing that in my programmes as far back as the 1980s when drilling nearly 2km.deep holes directionally. I did have very competent drilling crews mind you.

I don’t propose to expand on this topic here because there is much written on the economics, speed, and virtues of directional drilling from a mother hole by very savvy people in the game.

I look forward to the development of SGQ’s exploration programmes over the next 3 years.

Wishing you well with your investment lucky992,

Cheers,

Helmenesh.