investment highlights

Investment Highlights
h Junior gold developer Range River Gold Ltd (RNG) has
started a third phase of production at the historic Mt
Morgans operation near Laverton in Western Australia. First
ore from the high grade, low tonnage Craic deposit is being
processed at the Granny Smith mill and additional
underground production is expected in Q4 CY10. RNG
intends to deliver 40,000oz p.a. of gold from known
resources at Mt Morgans over the next five years. Potential
remains for RNG to delineate additional resources with
drilling in the June Quarter. We anticipate Mt Morgans will
re-enter production in line with RNGs expectations and
view forthcoming assay results from drilling at the Morgans
North prospect as a key catalyst.
h Ramp up underway. RNG achieved first ore production at Mt
Morgans in February, nine months after acquiring the exploration
tenements (800kmU) from Barrick Gold Corp in a $3.5m scrip
deal. RNG anticipates average gold production from Craic,
Ramornie, King Street and Transvaal deposits of 40,000oz p.a
over five years at a cash cost of A$700/oz over the life-of-mine
(LOM). Since May 2009, RNG has spent ~$0.5m delineating a total
Mineral Resource of 547,000oz of gold (5,347,600t at 3.18g/t Au).
This equates to a total cost for RNG of A$7.30/oz of in-situ gold at
Mt Morgans.
h Whats the Craic? The Craic deposit (also known as the Sons of
Gowrie deposit) is a previously unmined resource of 252,200t at
7.9g/t Au (64,400oz) which consists of flat dipping mineralised
basalt/porphyry structures which control repeatability at depth.
The first ore from Craic has been sent to Barrick Golds Granny
Smith mill, located 30km from Mt Morgans. The Craic deposit is
likely to remain the cornerstone for development at Mt Morgans
ahead of underground production in Q4 CY10.
h Additional output. RNG recently completed infill drilling of King
Street and Transvaal North open pit resources which are expected
to add to planned underground production at Craic and Transvaal.
The company has initiated a cutback at Ramornie with production
scheduled to begin in April. Additional ore may be sourced from
King Street and possibly Morgans North and Westralia deposits as
the Craic underground development gets underway.
h Exploration upside. Several high grade drill intersections have
been recorded in previous exploration by Barrick Gold which RNG
intends to follow up with drilling in Q2. We note potential for RNG
to reach targeted production of 60,000tpa with the discovery of
additional resources at Morgans North. Historic intercepts at
Morgans North have included 3m at 76g/t Au, including 1m at
115g/t Au, and further drilling is required to delineate a resource.
h Potential tie ups. Having reclaimed its status as a gold producer
RNG is seeking to acquire producing assets or projects that can be
advanced through completion of a feasibility study and project
financing. RNG may also farm out early stage exploration projects
to junior gold exploration companies.