Lebong Project

 The Lebong area hosts multiple examples of low-sulphidation epithermal gold-silver deposits, and represents a mining district which was a centre of sophisticated activity during the Dutch era but which was terminated by the outbreak of the Second World War.

The Lebong Project, which includes two under-explored mines districts (Donok and Tembang Sawah), lies approximately sixty kilometres to the west of Tembang within a large Dutch mining district within the 2,500 km2 Bengkulu SIPP.

The Company has conducted work on two of the former underground gold-silver mines within the district, Donok which produced.1.34 million ounces of gold and 7.4 million ounces of silver at a grade of 12.8 g/t gold, 70.5 g/t silver and Tambang Sawah eight kilometres to the north. Sumatra's objective is to identify and develop resources potentially amenable to open-pit mining in the vicinity of the old mines.

The Dutch mined the deposit underground to a cut-off grade of approximately 7g/t gold. Mining was restricted to 300 metres of strike where grade was highest, which ceased in about 1939. At cessation, level plans show average grades of 7.6 g/t gold still being recovered from Levels 11 and 12. Several types of veining are present, but historical production was from a single wide structure in the hanging wall to the Donok intrusive. Mineralisation is thought to extend over 1.6 kilometres of strike and to locally continue to surface.

4,108 metres of drilling in 25 holes in the vicinity of the Donok vein and its along-strike extensions has already been completed. A mineral resource has been estimated that is open in all directions. The wide drill spacing plus uncertainty as to the extent of the Dutch stoping means the resource is classified as Inferred. The estimated mineral resource for Lebong as of February 2009 is as follows:

Notes
Lebong resource quoted above a 0.35g/t Au cut-off
AuE = Au: Ag ratio of 1:75 with 100% recoveries assumed
51% of Lebong inferred resource extrapolated

The Dutch mine data allowed the construction of a 3D geological model which the Company's drilling to date has demonstrated to be accurate and reliable. The model identifies a second dacite body (Boenoet dacite) at depth which does not come to surface. A 1.3km long Dutch exploration drive on the penultimate level (Level 11) intersected and investigated breccias proximal to this Boenoet dacite which are understood to be similar to mineralised breccias proximal to the Donok dacite. Assuming the mineralisation style is similar, these breccias represent a substantial exploration target.