Thanks PH777. The full text. I think it answers every...

Thanks PH777. The full text. I think it answers every doubt.

Focus Minerals May Have A Big Trick Up Its Sleeve At Treasure Island In Western Australia
By Our Man in Oz



A gold discovery without a drill-core assay sounds a bit like an Aussie barbecue without a beer. That, sadly, is what investors in Focus Minerals are dealing with as their company beavers away on the promisingly-named Treasure Island project in the middle of Western Australia?s Lake Cowan, a lake which is rarely a lake, and is normally just a vast salt pan. If all this sounds confusing - gold without a drill assay in a lake which isn?t a lake - then the best advice is be patient and wait until August 1st, when all might be revealed at the annual Diggers & Dealers forum in Kalgoorlie. If that seems like too long to wait, you could come for a trip through ?semantic land? with Minesite?s Man in Oz, that peculiar language that the mining industry uses when it?s skirting around the tricky bits of the explorers Bible, the so-called JORC code.
Focus chief executive Campbell Baird, was trying hard to not say too much about Treasure Island when we contacted him a few days ago. He acknowledged that there was a degree of frustration in the market after last year?s burst of excitement about what his geologists had seen on the island in the (non) lake. ?Perhaps I got a bit too excited?, was Campbell?s assessment of what happened when Treasure Island snatched its first headlines. ?The problem was that I?m a mining engineer and I didn?t really appreciate the time it takes for exploration geologists to pinpoint their targets. I certainly understand now that it?s not a case of banging down the first hole to 90 metres and reporting six grams a tonne of gold.?

After that Mea Culpa from Campbell it?s time to probe what is really happening on and around the small island which appears to be of such importance to the future of Focus. But, before that, a quick word on the engine room that?s funding work at Treasure Island, Focus?s Coolgardie gold project. This is a much simpler subject, best summed up with this description: all?s well at the mines and mill. Production is growing steadily, tipped to hit 100,000 ounces of gold this year as second and third ore sources come on line: The Mount underground mine and an open pit at the Tindals mining centre. The target for next year remains 130,000 ounces, and the global resource base of the company, which controls most of the historic Coolgardie area (Kalgoorlie?s close relation), has expanded to 2.3 million ounces contained in 26.5 million tonnes of ore grading 2.6 grams a tonne.

Oh, how simple it is to measure the worth of a gold company when there are numbers to feed into a spreadsheet, and years of future, expanding production, can be seen. Treasure Island is exactly the opposite, though even without a downhole assay in sight there is little doubt that Focus is eyeballing something big. ?I would like to say more but we?ve decided to keep it tight until we know a lot more about what we have?, Campbell said. ?The key to that is a greater understanding of the complex geology. That?s why Dean Goodwin [the Focus geologist in charge of work at Treasure Island] is sitting next to the drill rig we have on site, assessing everything that comes out of the holes, and adjusting drilling as required.?

There will be no more statements similar to the eye-catching announcement of last November when Focus reported rock chip samples from the island of up to 58.9 grams per tonne of gold, and that a number of quartz vein arrays had been noted, along with fine visible gold disseminated throughout samples. It was that report which prompted some outsiders to compare Treasure Island with the St Ives goldmines on the southern edge of Lake Lefroy. ?It?s really not helpful to report results from what we?re doing now?, Campbell said. ?We?re about 10 holes into the program and each hole teaches us something new about the area. I can say what we?re seeing is incredibly exciting? - careful Campbell, that?s not a JORC term! ? ?but the crew on site is using the holes to understand the geology of what they?re drilling. They drill a couple of holes in one direction, and then we drill a couple in another - in the context of: if we put a hole under the salt lake under this structure, what does it tell us??

But, what is it that the driller (and the camp cook) are seeing coming out of the holes, and what measurements are appearing on the screens of the Niton assays guns they will undoubtedly have on site? Couldn?t possibly comment was Campbell?s reply. ?All I can say is that the geology is incredibly encouraging?, he said. ?We haven?t put any results out and we won?t for some time.? Perhaps one more pointed direct question from Minesite will elicit more detail. Q: Campbell, if I was an investor in Focus I would say: why aren?t I seeing assays?

?The answer is because you wouldn?t get a reasonable understanding of what we?re doing?, Campbell said. ?We?re only drilling about 30 metres a day. We?re only working on day shift. Dean is down there every day logging every single hole. He?s sitting on the rig and every time the drill finishes, or gets just half-way through a hole he makes an adjustment, re-designing the next hole to improve his understanding of the geology. The holes are taking days to drill and if we started releasing one or two results they might be meaningless to the average investor.?

There is, interestingly, another reason for the extreme caution with Treasure Island, and that?s a desire at Focus to be seen as a very serious player in the gold business and not a plaything of stock market day traders. ?Put it this way, we?ve worked pretty hard to get the company out of the realm of the day traders, and if we started to drip feed the market with hole-by-hole assays we could undo our efforts. One hole could be good. The next not so good, but on their own they say nothing about the underlying geology.?

With production bedding down at Coolgardie, Focus is becoming more of an exploration story than a steady-state producer. Treasure Island is top of the exploration list with a notional allocation of between A$10 million and A$12 million from a recent A$40 million capital raising. Another A$10 million of the fresh capital will be spent on the greater Coolgardie area, and the first drill hole is now being put down into a target called Golden Webb. There?s also about A$10 million for The Mount.

Open as he can be with the company?s exploration program, Minesite?s Man cannot resist one final crack at extracting more detail from Campbell, suggesting that Treasure Island might sound to some investors more like a simple treasure hunt. ?No, no, it?s not?, Campbell said. ?I?ve just got to be very cautious about what I say. All is can say is that we?re confident that we?re on to something. It is a project with a six kilometre strike, and we?ve got a lot more work to do? ? culminating, it is hoped, with something concrete to say at 11.45am on Monday, August 1st, when Campbell and Treasure Island take centre stage at Diggers & Dealers.