largest smo volume in 14mths and activities report released...

largest smo volume in 14mths and activities report released today. which brokers are buying and selling? same as those active on 20/12/02 and 24/1/03?

SMO - ASX Company Announcement
$gen0 THIS IS A PRIORITY ITEM
4 February 2003
Part 2/2
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SMC GOLD LIMITED
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HOMEX - Brisbane
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Second Quarter Activities Report

MINING

PRODUCTION COSTS

The December Quarter Cash Operating Cost Per Ounce of $399 per ounce
was a good result for the company especially when matched against a
rising gold price. During the month of December SMC sold gold for an
average price of $606.60 per ounce.

SMC adheres to the Gold Institute's Standard for reporting production
costs. The Company takes into account movements in Ore Stockpiles,
Gold in Circuit, Gold on Hand and total mothly Gold Sales to
determine quarterly gold production costs.

HADLEIGH CASTLE

The Hadleigh Castle underground mine, which is located 11 km east of
the Rishton mill, has improved its overall performance during the
quarter. Two relatively large stopes have been developed during the
December quarter and production improvement should be noticeable
during the third quarter as a result of the effort that has been put
into the development of these stopes.

Also, primary development has not been ignored during the quarter.
The decline has now been mined past the next level, the 795 m Level.
Development on this level will alternate between ore and waste
development depending on the requirement for waste to act as fill on
the level above. By utilising the waste produced from development
headings as fill the company eliminates the need to truck waste to
surface, thereby reducing the overall cost of mine development. It is
anticipated that the 795 m Level will be completely developed over
the next few months, well in advance of the completion of stoping on
the 815 m Level.

The new two boom jumbo, an Atlas Copco M2D, continued to perform well
during the quarter.

FAR FANNING

As anticipated in the previous quarterly report the open cut mine at
Far Fanning continued to produce high grade ore. In fact the grade of
ore mined increased from 5.34 g/t to 6.37 g/t, a very satisfactory
result. Open cut operations are continuing and these operations are
now expcted to continue to produce profitable results until the end
of the third quarter.

Planning for underground mining at Far Fanning is continuing.
Currently a start date has not been set due mainly to the uncertainty
with regards to the wet season. However, SMC has gained further
confidence about an underground operation following the high grades
being achieved in the current pits in areas directly above the
proposed underground mine.

EXPLORATION (SMC 100%)

During the December quarter a "Cation Leach" soil sampling
orientation study was commenced over selected gold prospects located
within the "Mine Corridor". Three lines of samples totalling 900
metres were collected. A further 400m of soil sample lines remain to
be taken The aim of the orientation study is to determine the best
method for analysis and expected levels of anomalism for the "Mine
Corridor". The results of the orientation study will be used as a
reference for soil sampling planned for structures and structural
intersection, highlighted by the ground magnetic survey completed in
June 2002.

Selected companies have been invited to view the exploration database
for the Rishton tenements. Some groups have expressed interest in
joint exploration but won't be making a decision until the next
quarter.

MINERAL RESOURCE/ORE RESERVE STATEMENT

Table 1 below details identified Mineral Resources (gold) as at 31st
August 2002.

TABLE 1

DEPOSIT CLASSIFICATION CUTOFF TONNES GRAD OUNCES TOPCUT
GRADE
g/t g/t

Hadleigh
Castle Measured 4.0 75,000 9.9 24,000 -
Indicated 4.0 133,856 8.3 39,000 -
Inferred 4.0 300,000 4.7 45,800 -

Total 508,856 6.6 108,800

Hadleigh
South Measured 2.0 2,000 5.9 400 -

Far Fanning Measured 2.5 38,100 6.6 8,100 -

Indicated 4.0 62,000 8.3 16,600 -

Total Far Fanning 100,100 7.7 24,700 -

Christian
Kruck Indicated 3.0 23,000 4.6 3,400 50.0

Inferred 1.0 29,000 5.4 5,100 50.0

Total 52,000 5.1 8,500

Joe's
Delight Inferred 4.0 51,000 7.0 11,400 -

Total Resources 713,956 6.7 153,800

Table 2 following details Ore Reserves as at 31st August 2002 that
have been delineated by applying appropriate dilution and recovery
factors to the mineral resource quantities.

TABLE 2

DEPOSIT CLASSIFICATION CUTOFF TONNES GRADE OUNCES TOPCUT
GRADE
g/t g/t

Hadleigh
Castle Proved 4.0 69,500 6.1 13,600 -

Probable 4.0 134,000 5.6 24,000 -

Total 203,500 5.3 37,600

Far Fanning Proved 2.5 46,000 5.7 6,400 -

Probable 4.0 62,000 7.1 14,100 -

107,000 6.0 20,500 -

Christian
Kruck Probable 3.0 28,000 3.2 2,800 50.0

Total Ore Reserves 338,500 5.6 60,900

RG Kidd
MANAGING DIRECTOR

The geological information contained in this report was prepared by a
Corporate Member of the Australasian Institute of Mining and
Metallurgy and a Member of the Australian Institute of Geoscientists.
Both have more than five yars experience in the field of the activity
on which they report. The members concerned, Messrs RG Kidd and HM
Mustard, are Competent Persons as defined by the Australian Code for
Reporting of Identified Mineral Resources and Ore Reserves. They have
consented to the inclusion of their report in the Quarterly Report on
Operations July to September 2002 for SMC Gold Limited. This report
accurately reflects the information compiled by those members.

ends - AAP

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