General Discussion, page-740

CGR (CGN Resources) have almost completed their drilling, the rig will wrap up and move to RCR targets soon. Even if Avalon isn't ready, I'd expect Gary will start swinging at the targets he can in the lead up to Avalon - RCR have the cash so why not!

Unfortunately, it looks like CGR didn't find any mineralisation in this round. This is not a criticism of CGR, I believe they have great ground and a large land holding which will generate many great targets into the future. The market knows the reality though, and that's exploration.

The first target CGR drilled and their main target at Webb (Surus) which was a coincident magnetic and gravity anomaly turned out to be sulphate, mudstone and graphite which would explain the geophysics anomaly.



The reason I'm highlighting this is not to poke holes at CGR, it was a worthy drill, but to highlight the false positives of geophysics.

How does this relate to RCR? Surus is +50kms away from RCR's Pokali and +60kms from Avalon. This is significant because the geology can change massively over that distance. At Pokali, there has been no drill to date that hasn't hit some form of copper or REE mineralisation, also, there has been no false positives from geophysics at Pokali - even when drilling into no anomaly (DD1) copper was still intercepted. Importantly at Pokali, no hint of mudstone and/or graphite. Big positive!

At Surus another interesting point is that it appears to have a peak gravity of 2 mGal and also the shape is not classic IOCG/Luni REE of oval/round.



The SA Australian IOCG copper gold mines all share commonality in they're mostly all oval/round in gravity shape and have gravity readings of +3 mGal - Carapateena 3.5 mGal, Prominent Hill 6 mGal and Olympic Dam 10 mGal.

With Avalon being so close to Pokali we can speculate that it's part of a similar mineralising event, it has a classic gravity shape and at 5 mGal is up there with all the SA cousins. The fact that Pokali 10kms up the road has had no false geophysics gives immense confidence that Avalon is the real deal. But is it IOCG copper gold or WA1 Luni REE Niobium - either one is worth the prize and I speculate that a significant IOCG copper gold discovery is worth more to the likes of BHP and neighbour RIO than Luni REE Niobium.