OceanaGold finds thicker, richer Frasers gold extension at Macraes

The hanging wall mineralisation, which is the target of the underground mine now being built, has been found to have some of the thickest formations and highest grade drill results down dip of the Frasers underground panel 2.

OceanaGold reported that five holes drilled down dip and east of the Frasers panel 2 have intersected additional ore grade mineralisation, extending the current panel 2 stope area by approximately 200m down dip.

The new zone of mineralisation is 10 - 20m thick and extends for approximately 400m along strike and remains open to the north, south and east.

The best of the drill holes intersected 19m at 3.76 grams a tonne (g/t) of gold. The other four drill-holes recorded 13m at 2.36 g/t, 10m at 1.98g/t, 9m at 3.72 g/t and 9m at 2.62 g/t.

OceanaGold said an additional seven drill-holes will be drilled in this area over the next few months as part of a A$2 million infill and extension drilling programme at Frasers underground.

Ore reserves from the drilling of panels 1 and 2 will be reported in the December 2004 quarterly report. Infill drilling of this extension is planned for 2005 and OceanaGold will provide a supplementary reserve statement in its March 2005 quarterly report. The Frasers underground bankable feasibility study, meanwhile, is on schedule for completion at the end of November 2004.

Development of the decline access to these panels is progressing and expected to be completed during the fourth quarter of 2006.

Macraes mine mineral measured and indicated resources at the end of 2003 were 84.6 million tonnes averaging 1.2 g/t with proven reserves of 27.7 million tonnes at 1.39 g/t. At that date the underground mineral resources were estimated at about 1 million oz.