***one direction***, page-7

Interesting item in Today's Australian
Tim Boreham - Criterion
Octagonal chasing a 'basket case' of gold

GIVEN the Singaporeans' takeover tilt at Castlemaine Gold this week, Victoria's gold scene may not be quite the basket case it's perceived to be, especially for the owner of a mine and processing plant that others have spent $30 million to develop.

Octagonal Resources (ORS) 15.5c

We note Octagonal's forecast of 30,000 ounces a year from its Maldon properties, with first output from the Alliance South decline due in the second half.

Pretty Maldon is better known today for tearooms and antiques shops but when it comes to gold it has a Crufts-standard pedigree.

Octagonal's ground was last mined in the 1980s by Triad Minerals, which kindly built a 150,000-tonne-a-year processing plant (replacement cost $15m).

The next owner, Alliance Resources, sunk $18m on the Alliance South decline before turning attention to its Four Mile uranium mine in South Australia.

Octagonal bought the assets in scrip deals and listed in January last year, with Alliance retaining 22 per cent and Newmont holding 8 per cent.

Octagonal chief Anthony Gray says the focus is on chasing the nuggety veins that characterise Victoria's gold deposits.

Others, notably Bendigo Mining, foundered after building large plants based on erroneous resource estimates. "We think we have learned from the mistakes of others and have our own idea about how to run a commercial operation in Victoria," Gray says.

The expected profits (perhaps $5m to $10m a year) will be used to chase one million ounce stuff in Western Australia and expand its Victorian ops.

Octagonal has a deal also to "toll treat" material from the historic A1 mine at Woods Point, which has had more owners than a 1971 Cortina.

Al Consolidated Gold issued a prospectus last week to raise $8m at 30c each to buy the mine and other assets. We'll dub Octagonal, which has never traded above its 25c listing price, a spec buy.

ends....

"More owners than a 1971 Cortina and up until now a real basket case"....methinks failures perhaps add infinitum.....

Caveat Emptor....Let the Buyer Beware!!