2000 Annual Report - Heron Resources Limited

ABN 30 068 263 098

Heron Resources NL 

Corporate Directory 

COMPANY SECRETARY 

Ross James Arancini BBus, ACA - Company Secretary 

110 Hensman Street, South Perth, Western Australia, 6151 

Telephone: (08) 9367 1213 Facsimile: (08) 9367 7853 

Email: rja@omen.net.au 

REGISTERED AND PRINCIPAL OFFICE 

21 Close Way, PO Box 1280, Kalgoorlie, Western Australia, 6430 


Email: heron@emerge.net.au 

Website: http://www.heronresources.com.au 

AUDITORS 

Butler Settineri Chartered Accountants 

35-37 Havelock Street, West Perth, Western Australia, 6005 

SOLICITORS TO THE COMPANY 

McKenzie Lalor 

74 Egan Street, Kalgoorlie, Western Australia, 6430 

Pullinger Readhead Stewart 

46-50 Kings Park Road, West Perth, Western Australia, 6005 

BANKERS 

Challenge Bank, 230-236 Hannan Street, Kalgoorlie, Western Australia, 6430 

CORPORATE ADVISOR 

Carmichael First Capital Pty Ltd 

Level 11, 77 St Georges Terrace 

Perth, Western Australia, 6000 

SHARE REGISTRY 

Security Transfer Registrars Pty Ltd 

Level 1, 168 Adelaide Terrace, Perth, Western Australia, 6000 


Email: securitytransfer@compuserv.com 

STOCK EXCHANGE 

Australian Stock Exchange Limited 

2 The Esplanade, Perth, Western Australia, 6000 

ASX CODE 

HRR 

SEAT ABBREVIATION 

Heron 

HOME BRANCH 

Perth 

INDUSTRY CLASSIFICATION 

OTHER METALS - 022 BASE METALS 

RESEARCH SERVICE INDEX NUMBER 

Mining H50 

ISIN 

AU000 000 HRR6 

All photographic page art was taken at Heron’s Goongarrie Nickel Project by Justin Madden, Reynolds Graphics Kalgoorlie. 

All inset artistic contributions are from the students of East Kalgoorlie Primary School; See inside back cover.


Directors 

Rodney Michael Evans 

FCA, FCIS, FCIM, AIArbA 

Chairman (Non Executive) 

21 Close Way, Kalgoorlie, Western Australia, 6430 

Ian James Buchhorn 

BSc (Hons), Dipl Geosci, MAusIMM 

Managing Director (Executive) 

21 Close Way, Kalgoorlie, Western Australia, 6430 

Robert George Colville 

AssocRMIT, MAusIMM 

Director (Non Executive) 

Level 1, 1 Sleat Road, Applecross, Western Australia, 6153 

Photo: Robert Colville, Rodney Evans, Ian Buchhorn 

Peter James Lee 

BBus, CA, FCIS, MAICD 

Director (Non Executive) 

210 Kings Way, South Melbourne, Victoria, 3205 

Annual Report 2000 

Contents 

1.0 Chairman’s Review...............................................................................................3 

2.0 Operations Review ...............................................................................................4 

3.0 Corporate Profile ................................................................................................38 

4.0 Directors’ Report ................................................................................................40 

5.0 Financial Statements........................................................................................45 

Profit and Loss Account.................................................................................45 

Balance Sheet ......................................................................................................46 

Statement of Cash Flow.................................................................................47 

Notes to and Forming Part of the Accounts......................................48 

Directors’ Declaration......................................................................................60 

6.0 Independent Audit Report.............................................................................61 

7.0 Shareholder Information ................................................................................62 

8.0 Interest in Mining Tenements......................................................................65 

Glossary of Terms ..............................................................................................79 

Heron Resources NL Annual Report 2000 page 1

Annual Report 2000 


Figure 1 - TENEMENT HOLDINGS 

Victory North 

Sandstone 

Mount Varden 

Victory JV 

Laverton 

6,800,000mN 

Leonora 

Murrin Murrin 

Merolia 

Aubils 

Mineral Patch Hill 

Lawrence 

Find 

Ghost Rocks 

Kookynie 

JV 

Bungalbin 

6,600,000mN 

Southern Cross 

Frances 

Lesley 

Snake 

Hill 

JV 

Dunnsvilles 

Bullabulling 

Blister 

Dam 

Menzies 

Goongarrie 

Cawse 

Mungari 

NW 

KALGOORLIE 

Coolgardie 

Gindalbie 

Terrane 

Binduli 

JV 

Edjudina 

Bulong 

Mt 

Martin 

Kambalda 

Kalpini 

Kurnalpi JV 

Transline JV 

Southern Laverton 

Tectonic Zone 

Mulgabbie 

Karonie South JV 

Widgiemooltha JV 

Pioneer 

Balladonia West 

50km 

Maggie Hays Hill 

Norseman 

6,400,000mN 

Balladonia 

Salmon Gums 

200,000mE 

400,000mE 

Photo Strip: Drilling Contractor Deep Mining Pty Ltd has continued its professional work throughout 2000. The excellent Diamond Drill 

validation results are an endorsement of Deep Mining’s attention to detail and quality assurance. 

page 2 


Annual Report 2000


Chairmans Review 

1.0 Chairman’s Review 

It is with pleasure that I present the fifth Annual Report of Heron Resources NL (“Heron”). Exploration and development success during 

2000 at the Goongarrie Nickel Project has resulted in the Company identifying a deposit acknowledged to be one of the 

premium ore occurrences in terms of grade, thickness and metallurgy that has been recorded within the fledgling Australian 

Nickel Laterite industry. Goongarrie is part of the Cawse Stage II Heron - Centaur Strategic Alliance. 

A year ago, Goongarrie was an inferred deposit drilled on an 800x80m pattern. In just 12 months, Heron has advanced its technical 

work such that: 

• Resource Definition Reverse Circulation drilling continued almost non-stop, with 36,920m in 782 holes completed. 

Strict rehabilitation procedures are in place, to ensure that environmental disturbance is minimised during the intense drill activity. 

• Confirmation Diamond Drilling was completed, consisting of 406m in 8 holes, which validated the RC drilling data and 

confirmed an excellent quality ore body. 

• Detailed metallurgical evaluation commenced at the Lakefield Oretest metallurgical laboratory, Perth, with 16 Goongarrie bulk 

samples currently under test. Results to date have been excellent. 

• Archaeological, ethnographic, flora, fauna, photogrammetry and baseline environmental surveys were completed, 

and tenement and hydrological surveys were commenced. 

As at 30 June 2000, the total Indicated and Inferred Mineral Resource above a 0.75% Ni cut-off for Goongarrie-Ghost Rocks- 

Kalpini and satellite nickel projects was 182.1 million tonne at 1.07% Ni and 0.08% Co. 

The Indicated and Inferred Mineral Resource above a 0.50% Ni cut-off for the Goongarrie-Ghost Rocks-Kalpini and satellite 

nickel projects was 405 million tonne at 0.8% Ni and 0.06% Co. The fully diluted Mineral Resource was 474 million tonne at 0.7% 

Ni and 0.05% Co, with contained metal of 3.4 million tonne nickel and 0.3 million tonne cobalt. 

The Goongarrie ore body will be a major factor in the continuing expansion of the Australian Nickel Laterite industry. 

This factor has been widely recognised. On 8 February 2000, Centaur Nickel Investments Pty Limited, a wholly-owned subsidiary of 

Centaur Mining & Exploration Limited, launched a Part C takeover bid to acquire the issued capital of Heron at 30 cents per Share. 

On 14 March 2000, Heron responded to the bid with a Part D Statement which included an Independent Expert’s Report valuing Heron 

Shares at 77 to 99 cents, with a preferred value of 86 cents per Heron Share. The Independent Directors of Heron 

recommended that Shareholders reject the offer by Centaur. The bid lapsed on 25 May 2000 without Centaur acquiring any Shares 

pursuant to the bid. The Shares have since traded in a range of 32 to 45 cents. 

At the date of this report, Centaur is completing a Pre-feasibility Study (“PFS”) for Cawse Stage II, but the results have not as yet been 

published. It is not known whether Centaur will proceed to a Bankable Feasibility Study (“BFS”) for Cawse Stage II. 

During the year, Peter Lee replaced Ken Hellsten as Centaur’s Nominee Director. The Company was fortunate to have access to Ken’s 

financial and technical knowledge of the lateritic nickel industry, and acknowledges Ken’s contribution to the Company’s growth. 

Highlights of the Company’s tenement activities during 2000 have been: 

• Consolidation of the Nickel Laterite tenement holding. This has involved pegging, outright tenement purchase, and the 

active trading of non-nickel tenements for demonstrated Nickel Laterite occurrences. The Heron tenement portfolio has remained 

constant at around 400 tenements, with non-nickel tenements progressively replaced by nickel tenements. 

• Securing a new Nickel Laterite project area at Merolia-Mineral Patch Hill, 60km SE of Laverton. 

• Securing 20km of strike of ultramafic-hosting Boorara Shear Zone immediately north and east of Kalgoorlie. 

The acquired ground is prospective for gold, being a comparable geological setting to that hosting the Paddington and 

Kanowna Belle gold mines. 

• Consolidation of the Balladonia Oil Shale Project. With escalating oil prices, Oil Shale development interest is increasing. 

Your Board’s continuing objective for the Company is to maximise growth for Shareholders through the identification, acquisition, 

evaluation and development of high quality mining projects. To this end, the Company’s Cawse Stage II Toll Milling agreement with 

Centaur is intended to bring the Goongarrie Nickel Project into production as the initial cash flow project for the Company. 

It is pleasing for Shareholders to reflect upon the market’s positive re-rating of our Company during 2000, with a share price increase 

in the order of 300% since 30 June 1999. The Board acknowledges the enthusiastic efforts and technical professionalism of its 

management and staff, and takes this opportunity to express its sincere thanks. 

RM Evans, Chairman 


Operations Review 


2.0 Operations Review 

HERON’S ACHIEVEMENTS 

• During 2000, Heron has doubled its Inferred Mineral Resource, and upgraded 34.3 million tonne or 

19% of the resource to an Indicated Mineral Resource status. 

• Goongarrie South has developed into a deposit with exceptional early cashflow potential: 

• Grade, at around 1.1% Ni and 0.1% Co, Goongarrie South has amongst the highest documented grades for 

an Australian laterite. Selective mining can deliver significant tonnages at 1.3% Ni and 0.4% Co. 

• Metallurgy, excellent leaching and rheological performance, which is characteristic of Limonite Ore. 

• Width and continuity, excellent with high grade zones continuous over strike lengths exceeding 2km and 

widths exceeding 160m. This favours future low cost bulk mining. 

• Highest ore grades are accessed early in the mining, with bonanza grade cobalt occurring at the top 

of the ore body. This is important for early project payback. 

• During 2000, genuine production opportunities have been negotiated by Heron: 

• The Cawse Stage II Toll Milling Strategic Alliance is Heron’s current focus, and has a potential production credit 

for Heron of 12,000tpa nickel metal. 

• A jointly-developed processing plant based in part on Keith Kilkenny Province Nontronite Ore is under discussion, 

with a potential production credit to Heron’s account of at least 20,000 tpa nickel metal in intermediate product. 

• Subject to Cawse Stage II ore requirements as determined by the Centaur August 2001 BFS, critical mass 

has been demonstrated for a Standalone Heron-owned processing plant based on Heron’s Walter Williams 

Formation Limonite Ore. 

• As part of a 30 year Strategic Plan, Heron has continued to secure strategic resources of commodities 

required as potential feed-stocks for processing Nickel Laterite. This will protect a potential $1.4 billion 

investment against unforeseen operating cost pressures. In all cases, Heron has sought to Joint Venture these 

tenements, but retain strategic revenue streams and Off-take rights. An increasingly valuable asset is the Oil Shale. 

• Reflecting on-going excellent drilling results during 2000, Heron has expended $2.5 million on 

exploration and has been continually drilling throughout the year: 

• At Goongarrie South, Heron completed 598 Reverse Circulation (“RC”) holes for 30,379 metres to confirm 

resource continuity at 80x80m, and 8 PQ Diamond Drill (“DD”) metallurgical holes for 406 metres. 

• At Goongarrie Hill, Heron completed 155 RC holes for 5,211 metres, including a 20x20m pattern to 

elucidate structural controls on mineralisation and confirm ore body lateral continuity. 

• At Scotia Dam, Heron completed 29 RC holes for 1,330 metres to outline resources and confirm geology. 

• The Company’s working capital position is robust at $3.9 million (at 30 June 2000), and is such that the 

cash demands of the proposed 2001 drilling programs are well accommodated. This cash position has arisen 

through the exercise of 10.15 million Options during the year, raising $2.54 million. 

Heron has developed a key position within the Australian Nickel Laterite industry, particularly in the event of any 

industry rationalisation, as demanded by the capital-intensive nature of the industry. Goongarrie is a premium product 

on all counts, including high start-up Ni-Co grades, ability to bulk mine, ability to blend Limonite Ore with lower quality 

ores, and proximity to rail and road infrastructure. 

GOONGARRIE SOUTH HAS STRATEGIC SIGNIFICANCE AND AS A 100%-OWNED ASSET, 

HAS TREMENDOUS VALUE TO THE COMPANY. 

Photo Strip: The bush at Goongarrie is in magnificent condition, reflecting its management by Conservation 

and Land Management (“CALM”), the station owner. CALM has established an ecotourism camp in the western 

part of Goongarrie at former pastoralist Bill Riddle’s old homestead. Heron’s tenements and drilling areas are restricted 

to the eastern part of Goongarrie. 

‘Back Home’ Wyvern Jackson “This picture represents a revegetated mine site. 

After Heron finishes mining, the Aboriginal people will come back to their land.” 

page 4 



2.0 Continued 


- 

121º 

GHOST 

ROCKS 

Kookynie 

121º30' 

Yerilla 

122º 

20km 

Figure 2 - 

MAIN NICKEL 

LATERITE 

PROJECT AREA 

Showing Strategic 

Alliance tenements 

and infrastructure 

Menzies 

GAS PIPELINE 

Edjudina 

-30º 

Davyhurst 

Comet Vale 

Goongarrie 

GOONGARRIE 

Ora Banda 

Cawse Spur 

Pipeline 

Gindalbie 

KALPINI 

THE 2000 

EXPLORATION 

-30º30' 

Cawse Nickel Laterite 

Processing Plant 

Broad Arrow 

RESULTS HAVE 

ALLOWED 

EXCEPTIONAL 

KALGOORLIE 

Bulong Nickel Laterite 

Processing Plant 

CONFIDENCE IN 

GOONGARIE AS 

A WORLD CLASS 

ORE BODY 

CONFIDENCE IN GOONGARRIE 

• The 80x80m in-fill RC drilling which commenced in March 2000 has confirmed excellent ore continuity at Goongarrie 

South. Remarkably virtually no loss of resource tonnes has resulted when moving from an 800x80m pattern to an 80x80m pattern. 

• The thickest and highest grade ore zone occurs as a uniform blanket at the Eastern Contact of the host ultramafic unit. This 

area will be the zone of initial mining. There are no barren holes of internal waste within this zone. This ore zone has been 

designated the Pamela Jean, in recognition of the on-going contribution of Pam Buchhorn to the success of Heron. 

• Bonanza grade cobalt (Cawse style “SiCo” ore) is associated with Tertiary-aged palaeo-channels that overlie the ore zones. 

From Diamond Drill core, the higher grade cobalt zones are found to correlate as a supergene blanket over what will be mining 

widths of 160m or more. The high grade Cobalt Resource at Goongarrie South is contained within a sub-resource of 8.2 million 

tonne at 1.3%Ni and 0.4% Co, representing 13% of the Goongarrie South resource. 

• The Diamond Drilling program has generated representative core samples of undisturbed ore which confirm: 

• Consistent ore correlation between holes, consisting of upper Mottled Clay, middle Limonite Ore, and lower Siliceous Ore. 

• Strong visual ore identification, with dark yellow hues and pyrolusite bands characterising high grade mineralisation. 

• Soft and free-digging orebody, with all ramps and infrastructure preferred to be on the competent eastern side basalt. 

• Well defined and logical mine scheduling proposals are apparent. The Stage I Pits will be on the Pamela Jean Zone, with 

progressive west-heading cut-backs for later stage pits. Ramps will remain restricted to the eastern wall basalt. 

It is apparent that any future Heron ore entitlement to Cawse Stage II could be sourced from Goongarrie South alone. 

This has favourable implications in respect of the centralisation of Heron’s infrastructure, and the ability for Heron to deal in a second 

and new development proposal for its non-Goongarrie Nickel Laterite resources. 



2.0 Continued 

Figure 3 - Joint Venture Areas 

100000 mE 

Sandstone 

300000 mE 

500000 mE 

Victory JV 

Edjudina Laverton JV 

Laverton 

Leonora 

Murrin Murrin 

Laverton Nickel 

6800000 mN 

Edjudina Nickel 

Lawrence 

Find JV 

Snake Hill JV 

Ghost Rocks 

Kookynie JV 

Menzies 

Edjudina 

Laverton JV 

6600000 mN 

Bungalbin JV 


Frances 

Lesley 

JV 

Blister 

Dam 

Goongarrie 

Cawse 

Mungari 

NW JV 

KALGOORLIE 

Gindalbie 

Terrane JV 

Boorara 

Shear 

Transline 

JV 

Bulong 

Kalpini 

Kurnalpi Nickel 

Southern Laverton 

Tectonic Zone JV 

Mulgabbie Nickel 

Kurnalpi JV 

Mt 

Martin 

Kurnalpi 


Bullabulling 

Kambalda 

Karonie South JV 

Widgiemooltha JV 

Norseman 

Karonie South 

Maggie Hays Hill 

Norseman 

6400000 mN 

Balladonia 

Salmon Gums 

Port of Esperance 

Southern Ocean 

Photo Strip: Geologist Colin Earle supervising the Goongarrie drilling. Colin was seconded to Heron from the Centaur 

Cawse operation. Colin’s contribution during 2000 is much appreciated. His good humour along with the willing assistance 

of other Cawse minesite personnel has made for an efficient Strategic Alliance. 

‘The Painting of the Man’ Tony Champion “I drew a man on the mine. This man is standing on the mine. 

The blue sky is the boss of his land.” 

page 6 



2.0 Continued 


STRATEGIC ALLIANCE 

The Heron-Centaur Strategic Alliance Toll Milling Agreement was completed early in the reporting year. It is a mechanism that was 

formulated to move Heron towards production while minimising the project risk to Heron through eliminating high levels of debt funding, 

and resultant high debt service charges. Concomitantly, the Strategic Alliance will crystallise economies of scale for both parties through 

the larger ore throughput of the merged resource base. The proximity of the Cawse processing plant to Heron’s project areas, the 

strong similarity of Goongarrie ore types to Cawse ROM ore feed, and the successful commissioning and ramp up of Cawse Stage I 

during 2000 suggests a high level of synergy exists between the Heron and Centaur operations. 

PRE-FEASIBILITY STUDY 

Heron has completed most of the studies required for a PFS for the Goongarrie Nickel Project. 

• Metallurgical testing is current, testing upgrade, settling, rheology, leach recovery and post-leach neutralisation. 

• Baseline Flora and Fauna Studies have been finalised, with typical Eastern Goldfields flora regimes documented. 

• Archaeology and Ethnographic Surveys are well advanced, with no sites documented. 

• Native Title Access Agreements are being negotiated in Good Faith for the grant of Mining Leases. 

• A Hydrological Consultant has been retained, and a bore hole water level monitoring regime established. 

• Confirmation Diamond Drilling was successfully completed under difficult ground conditions. The drilling has: 

• Validated RC grade estimates, notably at higher nickel cut-off grades. 

• Quantified the In-situ Bulk Density, 

Siliceous Ore SG is 1.8 - 2.3 2.0 used in resource estimation. 

Limonite Ore SG is 1.3 - 1.8 1.6 used in resource estimation. 

• Heron has quantified the Geotechnical response of the ore environment, which has facilitated in-house scoping pit designs. 

The mining management of Tertiary palaeo-channel aquifers overlying the ore zones is an important issue. Traffickability issues may 

ultimately be addressed by the use of 6WD articulated dump trucks for Goongarrie mining. 

IN TERMS OF THE PFS, GOONGARRIE SOUTH IS STRONGLY ADVANTAGED BY THE EXCELLENT LOCATION 

AND ESTABLISHED INFRASTRUCTURE OF THE EASTERN GOLDFIELDS. 

CORPORATE ADVANCES DURING 2000 

Nickel Industry Alliance Strategies 

• Capital costs are the main challenge for Nickel Laterite production, with Heron’s current estimate being $1.4 billion for a standalone 

4mtpa Pressure Acid Leach (“PAL”) processing plant. For a company of Heron’s size, a strategic partner is required who 

contributes financial and technical resources to this style of project. 

• In terms of risk minimisation, industry alliances facilitate: 

• Economies of scale in mining, processing and utilities, to reduce unit operating costs. 

• Shared infrastructure including rail, gas and water, and sourcing ore and servicing projects over a wide ranging operating area. 

• Potential for utilising an off-site “Back-end” for metal refining, supporting an off-site “brownfields” expansion of refining capacity. 

• Strategic Off-take and marketing agreements to help facilitate the banking of a project. 

• Resource blending, using Heron’s high quality Limonite Ore to leverage off and blend with less favourable ore to provide a 

constant long-term blended ore feed. This can improve the metallurgical performance of problem clay ore types (notably 

Nontronite Ore), and may increase the resource and thus project life. 

Joint Venture and Industry Association Strategies 

Joint venturing is a key component of Heron’s tenement management strategy. It allows Heron to control the large land bank which 

is integral to the long term development of Nickel Laterite resources. Heron has in operation or has offers on the table involving some 

21 Joint Ventures, alliances, options and Memorandums of Understanding involving oil shales, gold, base metals and iron ore. 

These industry associations cover some 155 tenements that will see a minimum Department of Minerals and Energy (“DME”) 

commitment of $1.5 million spent by our partners annually whilst Heron is free-carried. In addition a minimum total outlay of $10.65 

million can be spent on Heron’s joint ventured tenements before equity is transferred to the partner. By this process Heron is entirely 

free-carried in its gold and non-nickel developments, and in terms of risk-minimisation and success optimisation, the Heron non-nickel 

portfolio provides a very low risk and low cost means of asset creation. As an example, through its Bungalbin Iron Ore Production 

Royalty, Heron has a potential long term income stream. 



2.0 Continued 

Table 1 - HERON RESOURCES NL 

Summary of 100%-Owned and Joint Venture Tenements 

DME 

Project Number of Tenements Area Expenditure 

Pending Granted Total km 2 $million 

Strategic Alliance 33 32 65 908 0.46 

Heron 100% - owned 76 37 113 1,756 0.52 

Subtotal 109 69 178 2,664 0.98 

Established Joint Venture 57 98 155 3,710 1.47 

Advanced JV Negotiations 53 28 81 3,038 0.43 

Oil Shale 35 7 42 5,506 0.05 

Subtotal 145 133 278 12,254 1.95 

TOTAL 254 202 456* 14,919 2.93 

* Includes 37 Mining Lease applications covering active Prospecting Licences and Exploration Licences. 

The Heron Philosophy 

The commodity emphasis for Heron is unequivocally Nickel Laterite, 

and the project emphasis is Goongarrie, followed by Ghost Rocks 

and Kalpini. 

The Company appreciates the assistance provided by the 

Gindalbie, Hampton Hill, Mount Vetters and Goongarrie stations in 

terms of field camp sites, drill site preparation and rehabilitation. 

These stations have a long established land care ethic, under which 

Heron works at all times. Bill Riddle, the retired Goongarrie 

pastoralist, has been a great help in allowing Heron to understand 

his former property. 

Heron is an equal opportunity employer, committed to the 

community of Kalgoorlie-Boulder. It supports Work for the Dole 

programs, and several Aboriginal training schemes. The Company 

is proud to be a long term sponsor of Ngunytju Tjitji Pirni Aboriginal 

Corporation (“NTP”), an organisation committed to Aboriginal mother 

and children’s health in the Eastern Goldfields. 

One of Heron’s environmental contractors is Karlkurla 

Environmental. Karlkurla started as a Work for the Dole 

program doing community environmental work around 

Kalgoorlie-Boulder, and has now developed into a commercial 

contractor. Heron was the first of its mining clients, and wishes 

Karlkurla every future success. 

Photo: Sanderson Drilling Pty Ltd, contractors for the 

Diamond Drilling. The quality of core recovered was 

very good and a tribute to the skills of Sandersons. 

Heron, as with all Australian mineral explorers, continues to work within the framework of Native Title. The Company 

is committed to a policy of cultural respect and negotiation with the Aboriginal custodians of our exploration land. To 

the claimants of this land and the Goldfields Land and Sea Council, we once again express our appreciation of their 

patient negotiation, and ongoing site clearance field work. 

Photo Strip: These mudcracks are in a sump which holds drill return water. This particular sump is at GSRC 363 and the 

mud assays over 1.2% Ni. The sump prevents saline ground water affecting nearby vegetation. Hole GSRC 363 was 

drilling ahead in high grade ore at 84m depth. The sump became full of ground water. Continued drilling would have 

placed nearby tan wattles at salt risk. The hole was thus stopped in high grade ore. 

‘Two Ways’ Krystal Foley “This is a painting of two sides of the desert and of the mine site.” 

page 8 



2.0 Continued 


RESOURCE STATUS OF NICKEL LATERITE PROJECTS 

On the basis of 80x80m resource definition drilling (Indicated Mineral Resource status) and 400x80m reconnaissance drilling 

(Inferred Mineral Resource status), the total Heron resource inventory at a 0.75% Ni cut-off is: 

Table 2 - HERON RESOURCES NL NICKEL PROJECTS 

Inferred and Indicated Mineral Resource Inventory, 0.75% Ni Cut-off 

Pit Strike Width Million Ni Co Ni4Co* 

km km Tonnes % % % 

Goongarrie Hill GN1 5.80 0.20 17.7 1.08 0.06 1.31 

Goongarrie South GN2 7.00 0.30 63.0 1.08 0.09 1.44 

Scotia Dam GN3 2.40 0.30 9.1 1.10 0.11 1.56 

Total Goongarrie 89.8 1.09 0.09 1.44 

Ghost Rocks GR1 3.00 0.08 5.7 0.91 0.12 1.39 

Ghost Rocks GR2 4.50 1.00 12.3 1.02 0.06 1.26 

Total Ghost Rocks 18.0 0.98 0.08 1.30 

Acra North KA1 1.60 0.12 6.9 1.01 0.08 1.31 

Acra North KA2 0.40 0.20 5.4 1.31 0.07 1.57 

Wellington East KA3 0.40 0.12 3.8 1.04 0.08 1.36 





Wellington Fold KA9 2.50 0.20 2.1 0.88 0.07 1.14 

Wellington North KA10 3.60 0.16 1.5 1.04 0.06 1.27 

Total Kalpini 44.4 1.09 0.07 1.38 


SUB-TOTAL 152.2 1.07 0.08 1.40 

Binti Binti BB1 2.40 0.16 2.8 0.91 0.09 1.28 

Wyo Well WW1 1.00 0.16 0.8 0.83 0.04 0.99 

Acra AA1 0.70 0.30 0.5 0.75 0.04 0.91 

Total Kurnalpi 4.1 0.88 0.08 1.18 

Lake Rebecca LR1 2.20 0.30 11.6 1.15 0.07 1.46 

Lake Rebecca LR2 1.10 0.15 2.1 1.03 0.03 1.16 

Total Lake Rebecca 13.6 1.13 0.07 1.41 

Boyce Creek YE1 1.00 0.20 6.4 0.93 0.09 1.27 

Lady Byron YE2 0.60 0.20 2.8 1.11 0.05 1.30 

Aubils YE3 0.80 0.20 2.9 0.99 0.10 1.37 

Total Edjudina 12.1 0.99 0.08 1.30 

NON-STRATEGIC ALLIANCE 

SUB-TOTAL 29.8 1.04 0.08 1.34 

HERON TOTAL 182.1 1.07 0.08 1.39 

* “Ni4Co%” is %Ni plus 4 times %Co. 

The resource estimate uses intercepts above 0.75% Ni over a minimum 2 metre vertical thickness, with a maximum 2 metre of internal 

waste within the calculated intercept. The in-situ bulk density is interpreted to be 1.6 where Limonite Ore is predominant, and 2.0 where 

Siliceous Ore is predominant. 



2.0 Continued 

RESOURCE STATUS UPGRADE 

From the results compiled from the 80x80m drilling to date, the distribution of resources into Inferred and 

Indicated Mineral Resource categories is as follows: 

Table 3 - STRATEGIC ALLIANCE NICKEL LATERITE PROJECTS 

Medium Grade Inferred and Indicated Mineral Resource 0.75% Ni Cut-off 

Project Category Million Ni Co Ni4Co* 

Tonnes % % % 

Goongarrie Hill Inferred 15.7 1.09 0.06 1.33 

Indicated 2.0 0.99 0.04 1.14 

Sub-total 17.7 1.08 0.06 1.31 

Goongarrie South Inferred 32.5 1.06 0.07 1.39 

Indicated 30.5 1.10 0.11 1.53 

Sub-total 63.0 1.08 0.09 1.44 

Scotia Dam Inferred 9.1 1.10 0.11 1.56 

Indicated - - - - 

Sub-total 9.1 1.10 0.11 1.56 

Ghost Rocks Inferred 18.0 0.98 0.08 1.30 

Indicated - - - - 

Sub-total 18.0 0.98 0.08 1.30 

Kalpini Inferred 42.6 1.08 0.07 1.38 

Indicated 1.8 1.12 0.06 1.37 

Sub-total 44.4 1.09 0.07 1.38 

SUB-TOTAL Inferred 117.9 1.07 0.07 1.35 

SUB-TOTAL Indicated 34.3 1.09 0.10 1.51 

TOTAL STRATEGIC ALLIANCE 152.2 1.07 0.08 1.40 

* “Ni4Co%” is %Ni plus 4 times %Co. 

Having the higher quality Indicated Ore can substantially increase an Independent Valuation for a resource inventory, 

with a Yardstick Valuation typically doubling when the resource is upgraded from Inferred to Indicated status. 

When compared to the original 400x80m drilling, the grades generated from the 80x80m infil drilling are slightly higher, 

and the tonnes are slightly lower. This is the expected result of resource infill drilling. 

50,000,000 

1.5 

Figure 4 - 

GOONGARRIE PROJECT 

Comparison between 

400mx80m and 80x80m 

Resource Drilling 

Tonnes 400x80m 

Tonnes 80x80m 

%Ni 400x80m 

%Ni 80x80m 

Tonnage 

45,000,000 

40,000,000 

35,000,000 

30,000,000 

25,000,000 

20,000,000 

15,000,000 

10,000,000 

5,000,000 

41,600,000 

0.91 

44,850,000 1.32 

1.31 

1.12 

1.09 

0.90 

27,190,000 

24,630,000 

13,870,000 

13,740,000 

1.4 

1.3 

1.2 

1.1 

1.0 

0.9 

0.8 

0.7 

0.6 

0.5 

0.4 

0.3 

0.2 

0.1 

% Nickel Grade 

0 

0.50 0.75 1.00 

% Ni Cut-Off 

0.0 

Photo Strip: The drill samples are sieved and the drill chips are collected in chip trays as Heron’s reference set of the ore. 

Heron has some 50,000 of these chip samples archived at its Kalgoorlie office. The hardest and most important job on the 

rig is collecting the drill samples. A $1.4 billion investment decision hinges significantly on how well this job is done. 

‘The Mullock Dump of Binduli Mine’ Merita Stevens “This painting represents the Binduli mine. 

The big orange hill is the mullock dump.” 

page 10 



2.0 Continued 


Figure 5 - GOONGARRIE PROJECT 

Aeromagnetic Image, Geology, Drill Summary 

6675000 mN 

6675000 mN 

6670000 mN 

6675000 mN 

6670000 mN 

6665000 mN 

6670000 mN 

6665000 mN 

6665000 mN 

Intercept % Ni 

>1.25 

1.0 - 1.24 

0.75 - 0.9 

6660000 mN 

6660000 mN 

0.5 - 0.74 


2.0 Continued 

INDEPENDENT RESOURCE AUDIT 

An Independent Consultant has completed a draft audit of the Heron Nickel Laterite resource base. Heron’s 

methodology, quality assurance measures and data management were favourably assessed. Comparisons of 

resource estimates in respect of audited project areas were: 

Table 4 - RESOURCE COMPARISONS 

INDEPENDENT CONSULTANT 

Recoverable Resource Estimation 

0.5% Ni Cut-off Grade - Block Model 

HERON RESOURCES NL 

Fully Diluted One Metre Selvedge 

0.5% Ni Cut-off Grade - Polygonal End Area 

Project million tonne % Ni % Co million tonne % Ni % Co 

Goongarrie 229 0.74 0.06 233 0.74 0.06 

Kalpini 103 0.73 0.04 104 0.74 0.05 

Lake Rebecca 26 0.84 0.04 24 0.87 0.05 

TOTAL 358 0.74 0.05 361 0.75 0.05 

Results appear to be quite acceptable at a 0.5% Ni cut-off grade. At progressively higher cut-off grades, the Block 

Model tonnage estimates are increasingly lower than the Polygonal estimates. This is as expected when wide spaced 

drilling (400x80m) is used in Block Modelling. In view of the excellent continuity results to date at Goongarrie South 

using an 80x80m pattern, and subject to detailed lateral continuity studies, Heron may be able to use a 20x20m 

pattern for the Measured Mineral Resource estimates in its future Goongarrie South BFS. 

Figure 6 - GOONGARRIE SOUTH CROSS SECTIONS 

GOONGARRIE SOUTH 

69,200mN 

GSRC027 

GSRC028 

GSRC029 

GSRC030 

GSRC031 

GSRC034 

GSRC035 

GSRC036 

13/1.15/0.09 

5/1.34/0.12 4/0.93/0.10 

4/1.09/0.10 

17/0.9/0.06 

20/1.36/0.05 

48/1.15/0.10 

76m 

2600 mE 

75m 

68m 

2800 mE 

63m 

51m 

60m 

3000 mE 

60m 

66m 


68,800mN 

GSRC190 

GSRC191 

GSRC192 

GSRC193 

GSRC194 

GSRC195 

GSRC196 

GSRC197 

GSRC198 

4/0.86/0.07 

11/1.39/0.23 

12/1.23/0.12 

18/0.83/0.02 

2/1.4/0.03 

6/1.01/0.49 

8/0.85/0.02 

18/1.52/0.29 

37/1.01/0.08 

71m 

89m 

2600 mE 

65m 

71m 

2800 mE 

89m 

80m 

81m 

3000 mE 

89m 

74m 


68,400mN 

GSRC047 

GSRC040 

GSRC041 

GSRC042 

GSRC043 

GSRC044 

GSRC045 

GSRC046 

GSRC200 

GSRC201 

GSRC202 

70m 

5/0.86/0.13 

64m 

2600 mE 

53/1/0.05 

76m 

12/1.53/0.40 

15/1.35/0.11 

64m 

81m 

2800 mE 

68m 

78m 

2/0.87/0.54 

10/1.36/0.16 

25/1.00/0.04 

58m 

3000 mE 

77m 

20/1.2/0.16 

3200 mE 

13/0.95/0.02 

30/0.93/0.07 

8/1.07/0.06 

83m 

89m 

LEGEND 

>0.75 % Ni 

0.50 - 0.74 % Ni 

25m 

10/1.36/0.16 

INTERCEPT METRES / %Ni / %Co 

Photo Strip: This excavator was used for previous prospector exploration and mining at Goongarrie Hill. By chance, it 

opened up part of Heron’s Goongarrie Hill Nickel Laterite deposit. This excavation records large slabs of barren silica within 

the Nickel Laterite ore. This silica can be screened out, to increase Ni-Co grades by 35%. 

‘Dump Truck’ Shane Stokes “This is a painting of a dump truck carrying yellow sand. 

The sky is a grey-blue colour because of rain.” 

page 12 



2.0 Continued 


2.1 HERON RESOURCES NL - CENTAUR MINING & EXPLORATION LIMITED 


NICKEL LATERITE RESOURCE, PRE-FEASIBILITY STUDY FOR PROPOSED CAWSE STAGE II. 

The priority for the Strategic Alliance during 2000 has been to drill out the various Goongarrie resources to an 80x80m pattern, for 

inclusion in the Cawse Stage II PFS. This program, and the completion of Heron’s $3 million Strategic Alliance expenditure requirement, 

should be finalised in 2001. After that point, the more detailed drilling patterns (at least 20x20m) required for a BFS would be to Centaur’s 

account. There has been a seamless exchange of data and ideas between Heron and the Cawse minesite throughout 2000, which has 

contributed to the success of the Heron-Centaur Strategic Alliance. 

2.1.1 Goongarrie Nickel Project 

Heron 100%. Heron Toll Milling rights for ore processing through Centaur’s proposed Cawse Stage II plant. 

Nickel (- gold). 

The 181km 2 contiguous project area covering 24 tenements is located 60-100km NNW of Kalgoorlie along the eastern flank of the 

Goongarrie Dome. The western flank of this structure hosts the Cawse lateritic nickel mine. The lithological precursor of the Goongarrie 

and Cawse lateritic nickel mineralisation is the Walter Williams Formation komatiite, which unit defines the margin of the Dome. 

The Goongarrie Nickel Project is located 25km N of the Cawse processing plant. The Heron project area straddles the Kalgoorlie- 

Leonora Highway and Railway, and Goldfields Gas Transmission natural gas pipeline is located immediately to the east. Infrastructure 

is thus excellent in terms of Nickel Laterite mining and processing. 

Heron’s Goongarrie expenditure to date has been $1.77 million. 

Goongarrie Hill Prospect 

During 2000, Heron completed 155 RC drill holes at Goongarrie Hill for 5,211 metres. Significant intercepts include: 

Table 5 - GOONGARRIE HILL PROSPECT 

RC Drilling Significant Intersections, 0.75% Ni Cut-off 

Hole No. North East From To Interval Ni Co Ni4Co Ni4Co%* 

m m m m m % % % x m 

GWRC036 76,400 1,599 8 19 11 0.94 0.042 1.11 12.21 

GWRC040 77,205 1,520 6 16 10 1.06 0.093 1.43 14.30 

GWRC056 78,803 1,045 12 20 8 1.32 0.047 1.51 12.08 

GWRC062 78,780 1,450 0 14 14 0.91 0.051 1.11 15.54 

GWRC064 79,608 1,201 6 13 7 2.01 0.155 2.63 18.41 

GWRC098 76,557 1,561 4 24 20 1.06 0.023 1.15 23.00 

GWRC123 76,558 1,600 13 24 11 0.94 0.051 1.15 12.65 

* ”Ni4Co% x m” for a drill intercept is the value of %Ni plus 4 times %Co of the interval multiplied by the intercept in metres. 

Section interpretation and resource estimation has been completed for the area covered by the above drilling, with a current Inferred 

Mineral Resource of 17.7 million tonne at 1.08% Ni and 0.06% Co at a 0.75% Ni cut-off. 

Shallow high grade ore centred on drill holes GWRC088-091 (peak 2m at 1.97% Ni) has been targeted for processing through Cawse 

Stage I. The ore zone is on a granted Mining Lease. Environmental Performance Bonds have been lodged with the DME, and a Notice 

of Intent to Commence Mining is awaiting the final Flora and Fauna Survey report. Drill site rehabilitation outside the proposed mining 

area has been completed. 

Mineralised zones at Goongarrie Hill tend to consist of lower grade siliceous ore occurring at shallow depths. A total of 137 drill 

composites were submitted for screen upgrade assessment. Screen upgrades for nickel and cobalt are both very good. At a -0.5mm 

screen size, there is a 40% coarse (silica) reject, increasing both nickel and cobalt grades by 35%, with 76% of metal retained. 

This result is comparable to the published data for the Cawse nickel project, and is typical of Walter Williams Formation Siliceous Ore. 



2.0 Continued 

Goongarrie South Prospect 

During 2000, Heron completed 598 RC drill holes at Goongarrie South for 30,379 metres. Significant intercepts include: 

Table 6 - GOONGARRIE SOUTH PROSPECT 



m m m m m % % % x m 

GSRC043 68,400 2,790 11 23 12 1.53 0.399 3.13 37.51 

GSRC049 70,800 2,560 6 10 4 0.96 0.827 4.27 17.08 

17 39 22 1.04 0.070 1.32 29.04 

GSRC056 64,398 4,241 18 40 22 1.16 0.094 1.54 33.79 

GSRC057 64,397 4,324 14 40 26 1.25 0.069 1.53 39.68 

GSRC063 63,606 4,166 19 26 7 1.56 1.401 7.16 50.15 

GSRC160 71,199 2,401 9 17 8 1.12 0.051 1.32 10.56 

21 45 24 1.32 0.146 1.90 45.70 

GSRC165 70,397 2,321 19 23 4 0.93 0.038 1.08 4.33 

33 69 36 1.38 0.038 1.53 55.15 

GSRC197 68,798 3,040 34 52 18 1.52 0.289 2.68 48.17 

GSRC198 68,798 3,122 24 61 37 1.01 0.084 1.35 49.80 

GSRC200 68,398 3,121 15 35 20 1.20 0.159 1.84 36.72 

GSRC204 68,004 2,801 20 41 21 1.23 0.431 2.95 62.03 

GSRC259 68,239 2,721 11 37 26 1.34 0.191 2.10 54.70 

GSRC276 68,478 2,640 16 39 23 1.20 0.236 2.14 49.31 

GSRC309 68,719 3,043 24 71 47 1.43 0.228 2.34 110.07 

GSRC317 68,879 2,960 28 66 38 1.27 0.298 2.46 93.56 

GSRC318 68,881 3,040 20 54 34 1.33 0.043 1.50 51.07 

GSRC319 68,878 3,123 20 60 40 1.22 0.156 1.84 73.76 

GSRC330 69,040 2,718 38 60 22 1.41 0.141 1.97 43.43 

GSRC335 69,038 3,121 17 53 36 1.22 0.133 1.75 63.07 

GSRC336 68,958 3,120 19 42 23 1.01 0.084 1.35 30.96 

GSRC340 69,117 2,641 29 49 20 1.42 0.296 2.60 52.08 

GSRC346 69,119 3,119 13 45 32 1.40 0.142 1.97 62.98 

GSRC354 69,280 3,038 26 62 36 1.40 0.126 1.90 68.54 

GSRC355 69,278 3,120 21 43 22 1.20 0.098 1.59 35.02 

GSRC358 69,360 2,640 19 58 39 1.06 0.078 1.37 53.51 

GSRC362 69,359 2,960 21 45 24 1.17 0.096 1.55 37.30 

GSRC363 69,360 3,040 34 84 50 1.37 0.203 2.18 109.10 

GSRC377 68,241 3,280 23 37 14 1.67 0.179 2.39 33.40 

GSRC379 69,281 2,401 27 58 31 1.05 0.055 1.27 39.37 

GSRC399 68,080 2,882 29 60 31 1.26 0.043 1.43 44.39 

GSRC413 63,678 4,322 19 44 25 1.07 0.134 1.61 40.15 

GSRC420 63,757 4,322 26 56 30 1.11 0.139 1.67 49.98 

GSRC440 64,160 4,001 23 40 17 1.25 0.138 1.80 30.63 

GSRC462 64,560 4,321 4 28 24 1.12 0.093 1.49 35.81 

GSRC477 67,520 3,040 35 63 28 1.07 0.059 1.31 36.57 

GSRC529 68,160 3,360 21 41 20 1.24 0.072 1.53 30.56 

GSRC562 69,440 2,320 18 40 22 1.23 0.232 2.16 47.48 

GSRC571 69,440 3,040 37 60 23 1.22 0.085 1.56 35.88 

GSRC577 69,520 2,480 21 37 16 1.30 0.257 2.33 37.25 

GSRC594 69,680 2,880 19 40 21 1.42 0.040 1.58 33.18 

GSRC604 69,760 2,720 18 40 22 1.18 0.098 1.57 34.58 

GSRC626 69,920 2,640 36 53 17 1.43 0.147 2.02 34.31 

GSRC637 70,080 2,800 40 64 24 1.19 0.082 1.52 36.43 


Given that in Nickel Laterite, a value of 15 for Ni4Co% x m is considered a good result, the values returned at Goongarrie 

South are exceptional. It is important to note the areal extent of the above intercepts, 7.52 km N-S by 2.00 km E-W. 

Photo Strip: The drill samples are collected from the drill rig in polyester bags. Within a month of drilling, once 

Heron has completed all analyses, the ore sample is tipped out in sequential rows on the ground, and the polyester bags 

removed from site. 

‘Bill’s Mine’ Marika Smith “Around the mine are some plants and trees. 

The colour of the earth at the mine was green, yellow, grey and purple.” 

page 14 



2.0 Continued 


Goongarrie South Resource Estimation 

The drilling results from Goongarrie South have been exceptional, with extensive areas of drilling exceeding 15 Ni4Co% x m. 

Two holes in particular within the Pamela Jean Zone were outstanding: 

GSRC309 

GSRC363 

47 metres at 1.43% Ni and 0.23% Co 

50 metres at 1.37% Ni and 0.20% Co (and open at depth) 

This scale of metal enrichment is not documented elsewhere in the Eastern Goldfields Nickel Laterite province. Section interpretation 

and resource estimation is in progress, with a current Inferred Mineral Resource of 63.0 million tonne at 1.08% Ni and 

0.09% Co at a 0.75% Ni cut-off. Ore zone continuity is excellent. 

A screen upgrade study has commenced on RC drill chip composites. As expected from drill chip logging, the Limonite Ore does 

not upgrade, since it lacks silica. In contrast, with Siliceous Ore, there is a 47% screen reject at a -0.5mm screen size, for 43% Ni 

upgrade and 37% Co upgrade, with 74% metal recoveries. 

Of interest, gold mineralisation has been intersected in the course of Heron’s nickel laterite drilling, with the main Au-As anomaly at a 

100ppb Au threshold extending over a 2.2km strike length. The gold anomalism occurs in saprock beneath the nickel laterite 

mineralisation. Heron has completed a gold targeting plan, but as yet no gold drilling has been done. All resource drilling in the area 

of the gold target has a standard precious metal assay suite run on the drill composites. This work is outside the Strategic Alliance. 

Elsewhere in the Eastern Goldfields, gold anomalism is not recorded in association with lateritic nickel, reflecting an absence of iron 

within laterite-hosting komatiites. 

Goongarrie South Diamond Drill Core Grade Validation 

A program of PQ Diamond Drilling was completed by Heron as part of a quality control audit and to provide material for detailed 

metallurgy and density determinations. Heron completed 8 Diamond Drill holes for 406 metres. Core recovery was acceptable, with 

only GSDD04 having to be abandoned in transported cover (re-drilled as GSDD008, which similarly failed to reach its full target depth). 

Significant intercepts include: 


Diamond Drilling Significant Intersections, 0.75% Ni Cut-off 


m m m m m % % % x m 

GSDD001 68,401 2,724 15 28 13 1.49 0.195 2.27 29.51 

GSDD002 68,400 2,795 11 16 5 1.29 0.243 2.26 11.31 

22 24 2 0.83 0.054 1.05 2.09 

GSDD003 68,398 3,126 15 33 18 1.05 0.199 1.85 33.22 

GSDD005 68,798 3,127 25 44 19 1.24 0.123 1.73 32.91 

GSDD006 69,195 3,038 27 46 19 1.50 0.034 1.64 31.16 

GSDD007 69,199 3,124 7 54 47 1.11 0.110 1.55 72.85 

GSDD008 68,798 3,035 31 43 12 1.44 0.590 3.80 45.60 

50 55 5 1.22 0.111 1.66 8.32 


In-situ Bulk Density measurements indicate a range of SGs from 1.0 to 3.0. The arithmetic mean SG is 1.9 (1.8 SG is used at Cawse), 

but it is obvious that the SGs are extremely heterogeneous and will require detailed geology-based modelling. 

To be conservative, the Goongarrie South and Scotia Dam SGs have been reduced from 1.8 (as per Cawse) to 1.6 (as per Kalpini). 

Assay comparisons between a Diamond Drill hole and the adjacent RC drill hole are good, particularly within the supergene enriched 

upper mineralised intervals. There is thus confidence in the predictability of the upper high grade ore. This ore will be the mainstay of 

mining during the early project life. Within the lower ore zones, both lithological and assay correlations are less strong, reflecting 

localised structural controls on grade distributions. Correlation problems with cobalt are recognised in the limited Diamond Drill holes 

completed to date, with the RC drilling appearing to underestimate the cobalt grade when compared to the adjacent Diamond Drill 

hole. This result is somewhat biased by the exceptionally high cobalt grades in Diamond Drill hole GSDD008. 



2.0 Continued 


Diamond Drilling (DD) and 

Reverse Circulation (RC) Drilling 

Comparisons, 1.00% Ni Cut-off 

Hole From To Interval Ni Co 

Number m m m % % 

GSDD001 16 28 12 1.54 0.207 

GSRC042 18 28 10 1.42 0.113 

GSDD002 11 14 3 1.55 0.355 

GSRC043 11 23 12 1.53 0.399 

GSDD005 28 43 15 1.28 0.129 

GSRC198 24 34 10 1.12 0.182 

40 42 2 1.10 0.052 

GSDD006 27 46 19 1.50 0.034 

GSRC035 28 47 19 1.38 0.054 

GSDD007 10 29 19 1.38 0.196 

34 47 13 1.05 0.064 

GSRC036 12 35 23 1.34 0.121 

49 57 8 1.16 0.093 

GSDD008 35 43 8 1.70 0.700 

50 54 4 1.33 0.125 

GSRC197 34 43 9 1.64 0.442 

49 52 3 1.45 0.086 


Diamond Drilling (DD) and 

Reverse Circulation (RC) Drilling 

Comparisons, 1.25% Ni Cut-off 

Hole From To Interval Ni Co 

Number m m m % % 

GSDD001 17 28 11 1.58 0.221 

GSRC042 19 28 9 1.46 0.119 

GSDD002 12 14 2 1.81 0.404 

GSRC043 12 16 4 1.86 0.647 

GSDD005 28 34 6 1.41 0.184 

39 42 3 1.34 0.060 

GSRC198 29 32 3 1.41 0.182 

56 59 3 1.39 0.058 

GSDD006 27 45 18 1.52 0.033 

GSRC035 35 45 10 1.62 0.042 

GSDD007 13 29 16 1.43 0.228 

34 37 3 1.32 0.048 

GSRC036 15 30 15 1.47 0.147 

54 57 3 1.30 0.092 

GSDD008 35 38 3 2.34 1.520 

50 52 2 1.51 0.074 

GSRC197 35 43 8 1.72 0.472 

50 52 2 1.62 0.087 

The drill hole numbers with “GSDD” as a prefix and printed above in bold, denote the Diamond Drill hole results. The 

underlying row of data with “GSRC” as a prefix is for the adjoining RC drill hole, located some 5m from the Diamond 

Drill hole collar. 

Comparing Tables 8 and 9, all ore zones defined by the RC drilling have been replicated by the 

Confirmation Diamond Drilling. In terms of the large grade variability normally attributed to Nickel Laterite 

mineralisation, the correlation and validation results for the Goongarrie South ore zones are exceptional. 

Goongarrie South Metallurgy 

Half drill core samples were dispatched to the Lakefield Oretest metallurgical laboratory in Perth. A total of 14 half 

core and 2 RC drill chip geological bulk composites are undergoing metallurgical evaluation. Sample splits were 

returned to Kalgoorlie for check assay and qualitative screen upgrade testing. Replicate assays have demonstrated 

excellent precision, confirming a high level of confidence in the analytical programs. Initial metallurgical test work on 

Limonite Ore indicates an acid consumption of around 200-250kg/t and Ni and Co recoveries exceeding 93%, which 

is encouraging. 

A further 4 samples from Goongarrie South were collected by Centaur and submitted for metallurgical study as part 

of the Cawse Stage II PFS. Metallurgical performance was as expected for Walter Williams Limonite Ore, although 

final results are not as yet available to Heron. 

Photo Strip: These ore sample piles were drilled a year ago, during the 800x80m pattern drilling. The sample piles quickly 

decompose when exposed to the weather. 

‘Land of Navajo’ Leith Stevens “My painting represents a birds-eye view of the Navajo mine. 

The four hills represent the mine.” 

page 16 



2.0 Continued 


Goongarrie South Ore Genesis Studies 

Detailed technical studies, including XRD clay analysis in conjunction with the Geological Survey of WA at Kalgoorlie, are current on 

Heron’s Diamond Drill core, to elucidate the controls on mineralisation. There are two dominant ore styles. 

“Limonite Ore” consists of massive non-textured, amorphous clay-goethite occurring in the upper weathering zone of the ultramafic. 

Typically the ore is yellow-brown, and includes darker coloured horizons containing hydromorphic pyrolusite. The ore style and grades 

are remarkably uniform. Grades typically exceed 1.1% Ni and 0.1% Co, with the peak grades at the top of the ore zone. From 

geotechnical logging, the Limonite Ore is expected to be entirely soft and free-digging, with an in-situ bulk density of 1.3 to 1.8. 

“Siliceous Ore” underlies and is a less leached totally gradational variant from Limonite Ore. It contains massive to vuggy 

chalcedonic silica, which occurs as cellular stockworks with a dark brown clay infill. There is a sharp visual and grade boundary at the 

base of the Siliceous Ore, which is recognised by a pronounced increase in MgO to above 10%, accompanied by green clay colours 

and the appearance of magnesite in vugs and joints. Grades of Siliceous Ore typically exceed 0.75% Ni and 0.07% Co, and with 

screen upgrading of 30-45%, leach feed grades exceeding 1.1% Ni and 0.1% Co for the life of the project can be achieved. The 

Siliceous Ore should be initially free-digging in upper zones, but require paddock blasting with increasing depths. The in-situ bulk 

density similarly increases with depth, from 1.8 to 2.3. 

Detailed multi-element geochemistry has been completed on the Goongarrie RC drill data base to categorise ore styles: 

90 

Figure 7 - GOONGARRIE NICKEL PROJECT 

Differentiation of Limonite Ore and Siliceous Ore 

SiO 2 (Calc) 

80 

70 

60 

50 

40 

30 

20 

10 

0 

Scotia Dam Prospect 

Siliceous Ore 

Limonite Ore 

10.00 20.00 30.00 40.00 50.00 60.00 70.00 80.00 

FeO 

During 2000, Heron completed 29 RC drill holes at Scotia Dam for 1,330 metres. Significant intercepts include: 

Table 10 - SCOTIA DAM PROSPECT 



m m m m m % % % x m 

GSRC068 59,203 6,010 14 38 24 1.32 0.239 2.28 54.72 

GSRC069 59,200 6,086 11 17 6 1.03 0.178 1.74 10.44 

21 48 27 1.27 0.062 1.52 41.04 

GSRC076 58,800 6,169 14 35 21 1.39 0.226 2.29 48.09 

GSRC090 56,002 7,366 20 35 15 1.03 0.082 1.36 20.40 


A nickel sulphide target has been delineated at Scotia Dam. The anomalous interval is 18m at 2,466ppm Ni and 347ppm Cu 

at the basal contact of the olivine cumulate komatiite sequence. Peak copper is 0.14%. 

The eastern Scotia Dam prospect area on Siberia Formation ultramafic contains an area of 1.20x0.15km hosting a 20-78ppb Au soil 

anomaly within a favourable Bardoc Tectonic Zone structural setting. There has been no systematic drill testing of the target. The 

target zone is close to proposed mullock dump sites for the future Scotia Dam pit, so the gold target will be drill tested in the course 

of mullock sterilisation drilling. 



2.0 Continued 

2.1.2 Ghost Rocks Nickel Project 

Heron 100%. Heron Toll Milling rights for ore processing through Centaur’s proposed Cawse Stage II. 


The 207km 2 contiguous project area covering 3 tenements is located 140km NNW of Kalgoorlie along the eastern 

flank of the Goongarrie Dome. The Ghost Rocks area is located immediately west of the Kalgoorlie-Leonora Highway 

and Railway, and natural gas pipeline. Infrastructure is very good. Ghost Rocks is 100km NNW of the Cawse 

processing plant. The project area is 60km NNW of Goongarrie on the same Walter Williams Formation komatiite unit 

that hosts Goongarrie South. 

There are extensive areas of siliceous mineralisation at Ghost Rocks uniformly assaying 0.7-0.9% Ni with high cobalt. 

This ore style has significant increases in grade through screening, being comparable to the upgrade for Cawse 

mineralisation. An RC drill chip screen upgrade program was completed. At a -0.5mm screen size, Siliceous Ore has 

a 41% coarse silica reject, increasing both nickel and cobalt grades by 32%, with 75% of the metal retained. Limonite 

Ore upgrades 8% through screening, with 87% of the nickel retained. Limonite Ore thus does not require screening. 

Section interpretation and resource estimation was completed with a current Inferred Mineral Resource of 18.0 

million tonne at 0.98% Ni and 0.08% Co at a 0.75% Ni cut-off. In-fill drilling on an 80x80m pattern to upgrade 

the resource status is proposed for late in 2001. Expenditure to date has been $0.26 million. 

2.1.3 Kalpini Nickel Project 

Heron 100%. Heron Toll Milling rights 

for ore processing through Centaur’s 

proposed Cawse Stage II plant. 


M27/361 

P27/1449 

P27/ 

P27/ 

1450 

1448 

E27/185 

M27/362 

P27/ 

P27/1451 

P27/1452 

1453 

0 5 

KILOMETRES 

The 519km 2 contiguous project area covering 

17 tenements is located 65km NE of Kalgoorlie. 

Infrastructure is good. Kalpini is 75km E of the Cawse 

processing plant, and 45km NE of the Bulong Nickel Operation. 

Having confirmed metallurgical viability through the 1999 test 

program, detailed section interpretation and resource estimation 

was completed, with an Inferred Mineral Resource of 

44.4 million tonne at 1.09% Ni and 0.08% Co at a 

0.75% Ni cut-off. 

A comprehensive screen upgrade metallurgical program based on 

RC drill chips was completed on all ore zones identified from 

Heron’s previous drilling. Results indicate nickel upgrades ranging 

from 10% for Limonite Ore to 20% for Siliceous Ore. Nickel metal 

recovery is good at 82% for Siliceous Ore and 91% for Limonite Ore. 

E27/129 

E27/129 

Infill drilling on an 80x40m pattern has recently been completed, with 17 holes for 

442m at Wellington North, 8 holes for 236m at Wellington East and 19 holes for 

523m at Acra North. Typical Kalpini Nickel Laterite profiles were intersected, but 

no analytical results are as yet available. 

Native Title negotiations for the grant of Mining Leases are current. Ethnographic 

surveys have been completed in accordance with draft Native Title Heritage 

agreements on the exploration tenements. Rehabilitation of historical drill areas has 

been completed. The program was very ably completed by Brian Champion, an 

Indigenous rehabilitation contractor. 

M27/365 

M27/ 

349 

M27/ 

364 

M28/169 

M28/ 

206 

M28/205 

M28/ 

200 

M28/ 

202 

M28/ 

199 

E27/185 

M28/ 

201 

Legend 

Drill hole 0.5 - 0.99 % Ni 

Drill hole >1.0 % Ni 

Mining Lease application 

Exploration Licence 

Figure 8 - 

KALPINI 

NICKEL 

PROJECT 

Photo Strip: The bush in the future Goongarrie and Kalpini mine areas is a profusion of eucalypts, 

acacia, eromophila and lesser quondong. The Flora Surveys have determined that widespread comparable habitats adjoin 

the areas of proposed mining, so no environmental constraints exist for the projects. 

‘The Two Waters in the Middle’ Natalia Tucker “The circle is the green water at the bottom of the mine. 

The brown circle is the water at the bottom of the other mine.” 

page 18 



2.0 Continued 


A geological evaluation of basal komatiite nickel-copper sulphide targets generated from Heron’s regional RC drilling was completed, 

with laterite resource Zones 4 to 6 emerging as the optimum nickel sulphide target areas. Soil geochemistry within the broad target 

area has coincident anomalies of 114-602ppm Cu and 788-1,941ppm Ni, notably at the Zone 4 Western Ultramafic. A soil anomaly 

of 50-230ppb Pd occurs at Zone 6, again indicating a potentially favourable nickel sulphide setting. A proposed farm-in partner has 

completed literature studies followed by field traversing to validate the Heron exploration model and target areas. Centaur has a preemptive 

right on any nickel sulphide farm-out. 

Heron’s expenditure to date at Kalpini has been $2.68 million. 

2.2 SCOTIA KANOWNA PROVINCE 

NICKEL LATERITE RESOURCES NOT WITHIN THE STRATEGIC ALLIANCE. 

GOLD EXPLORATION JOINT VENTURES. 

Nickel laterite projects have continued to be acquired by Heron in the Scotia Kanowna Province subsequent to the 

formation of the Strategic Alliance. These projects are to assist a future Heron stand-alone processing operation, independent 

of the Strategic Alliance. 

2.2.1 Scotia Kanowna Project 

Heron 100%. 


The 62km 2 project area covering 7 recently pegged tenement applications is located 50-150km N of Kalgoorlie on the western flank 

of the Scotia Kanowna Anticline. 

The main target area is Vettersberg, adjoining the southern boundary of Heron’s Scotia Dam nickel laterite prospect. Grant of 

tenements is awaited, at which stage blanket 160x80m RC drilling of all ultramafic horizons will commence. 

Vettersberg Prospect 

Vettersberg occurs at the granite-greenstone contact on the eastern flank of the Goongarrie Dome, covering a 4km strike length of the 

nickel-prospective Walter Williams Formation. Previous drilling at Vettersberg confirms the presence of nickel laterite mineralisation. 

Following field mapping, a potential nickel sulphide target has been defined by Heron at the komatiite basal contact. 

Heron’s rockchip sampling of old costeans returned a peak value of 0.48% Ni from siliceous laterite. In terms of the lower nickel grades 

normally expected at surface, this result is encouraging. This zone is a high priority target, and drilling will commence once the 

tenements are granted. 

2.2.2 Kurnalpi Nickel Project 



The recently pegged 203km 2 project area covering 5 tenement applications is located 50-100km NE of Kalgoorlie on the western flank 

of the Arcoona Granite in association with the Emu Fault. The project area adjoins the Kalpini Nickel Project, but is not part of the 

Strategic Alliance. Three significant nickel targets have been generated, with potential for both nickel laterite and nickel sulphide 

occurrences. Grant of tenements is awaited, at which stage blanket 160x80m RC drilling of the ultramafic horizons will commence. 

Wyo Well Prospect 

Heron has tenement applications at Wyo Well, providing access on grant to a 12km strike length of ultramafic lithologies. Previous 

RAB intercepts include 12m at 0.84% Ni and 4m at 0.81%Ni. This previous exploration was not specifically targeted at the nickel 

laterite potential. Good potential exists for a Kalpini-style resource development. 



2.0 Continued 

Acra Prospect 

Heron’s field mapping at Acra has identified a 700x300m zone of poorly outcropping olivine cumulate lithologies. 

Previous drilling has confirmed the presence of nickel laterite mineralisation at the target zone northern margin. 

Table 11 - ACRA PROSPECT 

Aircore Drilling Significant Laterite Intersections, 0.75% Ni cut-off 


m m m m m % % % x m 

AA002 21,166 3,597 32 42 10 0.94 0.025 1.04 10.40 

AA012 20,911 3,617 16 24 8 0.89 0.110 1.33 10.64 

AA013 20,934 3,584 10 28 18 1.19 0.107 1.62 29.12 

AA055 21,480 3,392 2 8 6 1.04 0.310 2.28 13.68 


A 160x80m RC drilling program has commenced, with eight holes drilled for 154m. Analytical results are awaited. 

As well as nickel laterite at Acra, zones of pervasive low grade nickel sulphide mineralisation have been previously 

drilled, associated with olivine orthocumulate lithologies. Heron has designed an Electro-Magnetic ground survey 

coverage to follow up the target, including zones of gossan occurrences. High grade supergene gold targets have 

been identified by Heron through a review of previous exploration data. The peak previous drill intercepts are 1m at 

43-85g/t Au. These gold targets will be offered for farm-out. 

Mining Lease applications have been lodged on all nickel and gold resource targets which are identified at Acra. 

Binti Binti Prospect 

Binti Binti is the only granted tenement within the Kurnalpi Nickel project area. The Prospect is located 80km NE of 

Kalgoorlie immediately north of the Kalpini Nickel Project. The tenement comprises a wedge of northerly striking 

interlayered komatiite, basalt and felsic volcanic rock. Alluvium and laterite obscures bedrock. 

Aircore and RAB drilling carried out by previous explorers has delineated lateritic nickel-cobalt mineralisation. 

Significant intersections at a 1.0% Ni cut-off include: 

• 10m at 1.14% Ni, 0.12% Co 

• 6m at 1.28% Ni, 0.15% Co 

• 4m at 1.18% Ni, 0.07% Co 

• 4m at 1.14% Ni, 0.10% Co. 

The currently estimated Inferred Mineral Resource is 2.8 million tonne at 0.91% Ni and 0.092% Co at a 0.75% 

Ni cut-off. Cobalt is particularly elevated. Resource definition drilling is planned on a 160x80m pattern once the 

current Goongarrie drilling has been completed. Drill collars have been surveyed, access prepared and a DME 

Ground Disturbance Application lodged ahead of drilling. Rehabilitation has commenced in the drilling areas of 

previous tenement holders. Expenditure to date at Binti Binti has been $0.17 million. 

2.2.3 Menzies East Joint Venture Project 

Heron 100%. Golden State Resources Limited right to earn 60% through spending $0.25m. 

Gold (- nickel). 

The 8km 2 project area covering 8 tenements is located 112km NNW of Kalgoorlie, on the eastern flank of the Scotia 

Kanowna Anticline associated with the Moriaty Shear Zone. Golden State has completed a detailed soil 

geochemistry-aeromagnetic evaluation to assist in target generation. This study has highlighted the NW project area 

as Golden State’s exploration focus. Expenditure to date has been approximately $0.15 million. 

Photo Strip: In the heat of the day, the drill mast is the only source of shade. On rocky outcrops, nickel grades tend to be 

low. Out on the flats, the ultramafic host rocks are more strongly weathered, and nickel grades improve accordingly. 

‘Binduli Mine’ Kim-Thi Nguyen “This is a conveyor belt with a sign that says go and stop on each side. 

The sky is grey because it was a showery day.” 

page 20 



2.0 Continued 


2.2.4 Gindalbie Terrain Joint Venture Project 

Nickel rights retained by Heron. Delta Gold Limited right to earn 70% in respect of gold through spending $1.0m. 

Gold - nickel. 

The 201km 2 project area covering 6 tenements is located 25-60km NE of Kalgoorlie on the eastern flank of the Scotia Kanowna 

Anticline. The main structural control of the project area is the Moriaty Shear Zone. The Moriaty structure is a bifurcation of the intensely 

gold-mineralised Bardoc Tectonic Zone, which is an associated structure occurring on the western flank of the Scotia Kanowna 

Anticline. The Gindalbie Terrrain adjoins the Golden Cities-Federal granitoid gold province. 

A detailed data appraisal and field inspection has generated both gold and lateritic nickel targets. The main gold target is the Moriaty 

Shear Zone in the SW project area, where alluvial gold previously has been mined. Drill access has been difficult, due to wet ground 

conditions since February 2000. 

Delta has completed a GIS data review ahead of a regional Auger drilling program. Heron’s expenditure to date has been $0.21 million. 

2.2.5 Yindarlgooda Project 



The 58km 2 project area covering one tenement application is located 40km E of Kalgoorlie at Clinker Hill on the western flank of the 

Bulong Ultramafic Complex. Heron’s main target interest is lateritic nickel associated with the Bulong ultramafic units. From data 

reviews, several gold targets, including 3m at 5.49g/t Au, have been generated for follow-up once the tenement is granted. 

2.3 EMU FAULT PROVINCE 

GOLD EXPLORATION JOINT VENTURES 

2.3.1 Kurnalpi Gold Joint Venture Project 

Heron 100%. Farm-in partner right to earn 80%. 

Gold. 

The 260km 2 project area covering 4 tenements is located 60-90km E of Kalgoorlie, adjoining Heron’s Transline Joint Venture Project. 

Tenement grant is awaited. 

Following a GIS data review and target generation by Heron, a farm-out has been agreed whereby a farm-in partner may earn 80%, 

with Heron free-carried to decision to mine. 

A further 9 tenement applications covering 730km 2 are currently subject to farm-out negotiation. This project area has an excellent 

structural setting, covering the Emu-Avoca Fault System. The dominant outcrop lithology is felsic volcaniclastics and lateritised 

meta-sediments. This geological setting is analogous to that of the Randalls-Maxwells gold mining centre to the immediate south. 

From data reviews, several gold targets have been generated for drill follow-up once the tenements are granted. Significantly, borefield 

targets associated with Tertiary palaeochannels and the Emu-Avoca Fault System have been defined for future Kalpini process 

water requirements. 

2.3.2 Kalpini Gold Project 


Gold. 

The 88km 2 project area covering 10 tenements is located 50-60km NE of Kalgoorlie, within felsic volcaniclastics occurring between 

the Avoca, GMQ and Emu Faults. 

The felsic volcaniclastic geological setting is comparable to that hosting the Carasue gold mine located to the northeast. Several gold 

targets have been generated by Heron’s regional soil geochemistry. These anomalies occur within a favourable structural setting, covering 

the Emu-GMQ Fault System. Heron’s main interest is volcanogenic massive sulphide targets, as potential sulphur sources for future nickel 

laterite processing. Literature reviews are current, with soil geochemical field programs planned to commence once key tenements 

are granted. Heron’s expenditure to date has been $0.10 million. 



2.0 Continued 

2.3.3 Transline Joint Venture Project 

Heron 100%. New Hampton Goldfields Limited right to earn 80% through spending $0.8m. 

Gold-nickel. 

The 421km 2 contiguous project area covering 13 tenements is located 60km ESE of Kalgoorlie on the Bulong Anticline 

straddling the Emu Fault. The project area is underlain by the Juglah Monzogranite which intrudes felsic volcanics. Gold 

mineralisation is extensively developed, and includes the Juglah, Trojan and Transfind gold mining centres. 

The geological setting is a rift granitoid, and is comparable to the Laverton Tectonic Zone located to the east. 

Heron previously generated several +50ppb gold in soil targets associated with the GMQ Shear Zone, following which 

a tenement acquisition program was carried out. GIS compilations were subsequently completed, identifying from 

previous exploration several +1g/t Au RAB anomalies, peaking at 6g/t Au. 

The Heron gold targets are planned for drill follow-up by New Hampton. Expenditure prior to joint venturing was $0.10 

million, with most tenements only granted during June 2000. 

2.4 KEITH KILKENNY PROVINCE 

NICKEL LATERITE RESOURCES. 

GOLD RIGHTS WITHIN OR UNDER JOINT VENTURE OFFER. 

Heron’s Keith Kilkenny Province nickel laterite projects are associated with discrete rift-related ultramafic olivine 

cumulate channels, as opposed to the more sheet-like adcumulates of the Walter Williams Formation. As such, the 

Keith Kilkenny occurrences are prospective for Silver Swan style nickel sulphide mineralisation. Heron’s exploration 

to date has however been restricted to nickel laterite. 

2.4.1 Kookynie Joint Venture Project 

Heron 100%. Barminco Pty Ltd and Kookynie Resources NL right to earn 70% through spending $0.75m. 

Nickel rights retained by Heron. 

Gold-nickel. 

The 275km 2 project area covering 8 tenements is 

located 20-60km SE of Leonora within the western 

margin of the Keith Kilkenny Tectonic Zone. The 

tenements are all within hauling distance of Barminco’s 

Orient Well CIP gold plant. 

The project area is largely soil covered basalt and felsic 

volcanics occurring along strike from the Apollo Hill gold 

occurrence. Lateritic nickel targets are associated with 

rift margin serpentinites, for which Heron retains all 

nickel rights. 

Heron and Barminco have completed a GIS target 

generation study, with field mapping confirming 

favourable drill targets. Tenements are in their first 

year of grant, so field programs have not as yet 

commenced. Expenditure to date has been 

$0.1 million. 

Photo: Ian Buchhorn (Managing Director) and David Crook (Exploration 

Manager). The Heron office is fully set up for all of Heron’s data 

management and plotting needs. 

Discussions are current in respect of a farm-out of a further 7 tenement applications covering 36km 2 

Kookynie area. 

in the northeast 

Photo Strip: Heron minimises track clearing in its exploration work. It is far easier to drive around a tree or use existing 

pastoralist tracks, than clear new ground. After scarifying the track when exploration is completed, rehabilitation is then 

only a couple of good storms away. 

‘The Dreamtime Road’ Kenneth Jackson “It is going back in the past.” 

page 22 



2.0 Continued 


2.4.2 Edjudina Nickel Project 



The 338km 2 project area covering 31 tenements is located 145-175km NNE of Kalgoorlie within the Keith Kilkenny Tectonic Zone. 

This rift structure is associated with ultramafic complexes from south to north at Lake Rebecca, Boyce Creek, McAuliffe West, Monk 

Well and Aubils. The ultramafic flows are located on the rift margins interbedded with basalt, with the rift axes containing coarse 

sediments. 

During 2000, drill programs were designed and collars surveyed to follow up the ore zones drilled up by Heron during the 1999 field 

season. Several attempts were made to access the target areas, which are marginal to Lake Raeside. Rig access near the lake edge 

was however not possible. Ethnographic surveys were completed for the Edjudina mineralised areas. Mining Lease applications were 

lodged covering all known nickel laterite resources within the project area. 

The Edjudina nickel laterite targets are an important asset in a Keith Kilkenny Nickel Laterite resource rationalisation now under 

discussion involving Heron’s Lake Rebecca to Aubils lateritic nickel resources. 

Heron’s expenditure to date on the Edjudina Project has been $0.7 million. 

Yerilla-Boyce Creek Lateritic Nickel Prospect 

Drill hole sectional interpretations, provisional pit designs and resource estimation were completed. The current Boyce Creek 

resource estimate is 6.4 million tonne at 0.93% Ni and 0.09% Co at a 0.75% Ni cut-off. An independent audit of the resource 

was completed. Discussions are current in respect of trial mining using a locally based miner and earthmoving contractor. Heron will 

not be contributing to earthmoving costs. Ground Disturbance Applications have been lodged with the DME ahead of detailed ore 

resource drilling. Rehabilitation of historical drill areas outside the proposed mine area is current. 

A Mining Lease application over the ore zone has been lodged, and Heritage Surveys completed. 

Yerilla-Lady Byron - McAuliffe West Prospect 

Drill hole sectional interpretations, provisional pit designs and resource estimation were completed. The current Lady Byron 

resource estimate is 2.8 million tonne at 1.11% Ni and 0.05% Co at a 0.75% Ni cut-off. Ground Disturbance Applications 

have been lodged with the DME ahead of detailed ore resource drilling. 

Yerilla-Aubils Prospect 

Drill hole sectional interpretations along with field geological mapping has confirmed the Aubils laterite profile has been variably eroded 

by Tertiary-aged palaeochannel development. There is thus a complex regolith profile at Aubils, which has necessitated in-fill drilling 

of the defined ore zones. Some of the northern zones of strong aeromagnetic anomalism adjoining Kilmore Hill are now interpreted to 

be gabbro related, rather than ultramafic. 

Resource estimation was completed. The current Aubils resource estimate is 2.9 million tonne at 0.99% Ni and 0.10% Co 

at a 0.75% Ni cut-off. Ground Disturbance Applications have been lodged with the DME ahead of detailed ore resource drilling. 

2.4.3 Keith Kilkenny-Laverton Tectonic Zone Joint Venture Project 

Nickel rights retained 100% by Heron. Croesus Mining NL right to earn 80% in respect of gold through spending $1.0m. 

Gold. 

The 569km 2 joint venture area covering 18 tenements is located within two separate areas. The southern area Edjudina joint venture 

is 120-160km NE of Kalgoorlie north and south along strike of the Porphyry gold mine within the eastern Keith Kilkenny Tectonic Zone. 

Gold mineralisation occurs dominantly in quartz stockworks within felsic and granitoid host rocks. 

The northern area Mount Varden joint venture is 55km N of Laverton within the Laverton Tectonic Zone. Major gold mining centres in 

the area are generally associated with Banded Iron Formation (“BIF”), and from south to north include Corktree Well, King of Creation 

and Rosemont. 

Croesus has expended $0.3 million on exploration to date, with in excess of 9,000m of drilling completed. 



2.0 Continued 

Edjudina Prospect 

The prospect area including the Oak Well tenement group covers a very complex shear zone into which syn- and 

post-tectonic granitoids have been emplaced. Deformation in the region has been taken up as ductile shears in the 

greenstone belts, as brittle-ductile structures in granitoids, and locally as a late stage rift basin into which the Yilgangi 

Conglomerate was deposited. 

The syntectonic granitoids are gold-mineralised, including gold mining centres at Yarri (brittle structures) and Porphyry 

(ductile mylonite zones). The Oak Well Shear Zone is characterised by an elongate composite granitoid hosting 

remnants of basalt and felsic to intermediate schist. A post-tectonic gabbro is locally emplaced into the Shear Zone. 

Recent exploration has confirmed the area to be prospective for both base metals and gold. Highly anomalous Cu, 

Zn, Pb and As values are associated with chert and gossanous schists within a magnetic intermediate schist unit. 

This zone is also anomalous for gold, with gold in soil to 1,900ppb, and gold in rock chips to 46.8g/t. 

Exploration by Heron and then Croesus has included target generation, field mapping, and Aircore and RAB drilling. 

Drill target areas were generated using detailed aeromagnetic data, followed by regolith mapping and field 

reconnaissance. 

Table 12 - EDJUDINA LAVERTON JOINT VENTURE 

Oak Well Drilling Summary 

Tenement Drill Type Holes Metres Samples 

E31/190 RAB 10 131 34 

E31/233 RAB 9 455 104 

E31/234 RAB 10 340 78 

E31/235 RAB 51 296 134 

E31/288 RAB 54 3,096 677 

E31/288 Aircore 8 527 121 

E31/311 RAB 75 3,324 733 

Project Total 217 8,169 1,881 

Photo: Simon Gobbett (Project Geologist) and 

Alan Rudd (Senior Geologist). This year, Simon and 

Alan added about 50 million tonnes of high grade 

laterites to their discovery record. 

Two campaigns of drilling were completed which included 217 holes for 8,169 metres within the Oak Well group: 

Table 13 - EDJUDINA LAVERTON JOINT VENTURE 

Oak Well Drilling Significant Assays 

Hole ID North East From To Intercept Grade Geology 

m m m m m g/t Au 

ENRB088 22,400 21,200 25 30 5 0.55 Clay-sericite saprolite, 2% quartz veining 

49 52 3 0.23 Sheared volcaniclastic schist 

ENRB110 23,300 20,600 45 55 10 0.20 Foliated clay-sericite felsite 

Varden Prospect 

A RAB program was completed on the Varden Prospect located 50km north of Laverton, to test low-tenor soil gold 

anomalies. A total of 27 holes for 1,108m were completed. Rock types encountered include black shale, chloritealtered 

quartzite, serpentinite and lesser basalt, dolerite, porphyry, felsic schist and BIF. Chlorite and sericite were the 

dominant alteration styles, with silica and carbonate alteration associated with gold anomalism. 

Photo Strip: After a good rain or two, these scarifying furrows become verdant with annuals. In a year or so, the saltbush 

is back, and then the acacia understorey. 

‘The Water Holes’ Andrea Munmurrie “There was lovely green water and on the top of the green water 

there was brown water.” 

page 24 



2.0 Continued 


2.4.4 Southern Laverton Tectonic Zone Joint Venture Project 

Nickel rights retained 100% by Heron. Gutnick Resources NL right to earn 80% in respect of gold through spending $1.2m. 

Gold. 

The Southern Laverton Tectonic Zone Project is located 150km NE of Kalgoorlie. Heron’s tenements comprise 19 granted tenements 

and 14 applications that cover a total of 302km 2 . The tenements within the Southern Laverton Tectonic Zone extend 100km from the 

southern limit of the Anglo-Saxon gold mines (170,000oz) to immediately west of the Red October gold mine (340,000oz). This 

structural zone hosts gold mineralisation from south to north at Pinjin, Edjudina, Safari Bore, Red October and Sunrise Dam, and then 

north into the Laverton gold mining district. The Laverton Tectonic Zone gold province has a total resource base that is in excess of 

22 million ounces of gold. Its rise to exploration prominence over the last decade reflects the use of “state of the art” Remote Sensing 

techniques to define drill targets in areas of uniform transported lake cover. 

The western joint venture area is associated with the Keith Kilkenny Tectonic Zone which hosts gold mineralisation from south to north 

at Karonie, Carasue, Old Plough Dam, Porphyry, Apollo Hill, Malcolm and Sons of Gwalia, and then north into the Yandal Belt. Gold 

mineralisation is dominantly associated with bimodal felsic volcaniclastics and mafic volcanics hosting comagmatic granitoids which 

have been emplaced into the rift sequence. The eastern joint venture area is associated with BIF horizons of the Laverton Tectonic Zone. 

The structural framework and rock-type package that hosts the large gold deposits of the Laverton Tectonic Zone gold province has been 

characterised by Remote Sensing techniques and traced through Heron’s project area. These favourable settings are reflected by 

numerous small high-grade gold deposits, which have been mined since the early 1900s until the late 1980s within and adjacent to 

Heron’s tenements. 

A detailed study of available open file data has been completed, involving the GIS synthesis of Heron’s aeromagnetic data, satellite 

imagery and geological mapping. These Remote Sensing data sets were merged with geochemical, drilling and mining data. This has 

highlighted that previous exploration has been confined to areas of good exposure and shallow weathering profiles, with very little 

effective work completed in the more prospective areas of thicker cover. The Joint Venture is utilising the Remote Sensing techniques 

which are required for areas of deeper weathering profiles. Several mineralised trends and conceptual targets have been defined from 

the GIS interpretations within Heron’s tenements, which will require drill testing. 

At present, Auger drilling of the Heron project area is in train, utilising pedogenic calcrete sampling. Full analysis of results is awaiting 

completion of the program. 

A further 163km 2 project area covering 16 tenements is currently subject to farm-out discussions. Advanced prospects previously 

drilled by Heron within this area include Banjo (28m at 1.41g/t Au), Webb Find (12m at 3.80g/t Au), Yarri (14m at 2.06g/t Au) and 

Yilgangi (4m at 1.75g/t Au). The exploration target is quartz stockwork gold systems. Under the proposed joint venture, Heron would 

be free-carried through to mining. Expenditure by Heron on the proposed farm-out area has been $0.5 million. 

2.4.5 Mulgabbie Nickel Project 



The 4km 2 project area covering 3 tenements is located 110km NE of Kalgoorlie. The project area covers rift-related mafic to ultramafic 

units striking NNW along the southwest shore of Lake Rebecca. This sequence occurs at the eastern margin of the Keith Kilkenny 

Tectonic Zone. 

Access preparation was planned to facilitate RC drill testing of the flood-prone southern extension of the main Lake Rebecca nickel laterite 

mineralisation. Proposed drill collars have been marked out, but rig access at this stage is not possible without causeway construction. 

The extensive areas of previous drilling completed prior to Heron’s tenancy of the project area have been rehabilitated to Heron’s 

environmental standard. An ethnographic and archaeological survey was completed for the Lake Rebecca area. 

The current Lake Rebecca resource estimate is 13.6 million tonne at 1.13% Ni and 0.07% Co at 0.75% Ni cut-off. The 

resource is open to the south. Metallurgical testwork and scoping studies in respect of the high grade nickel laterite ore are on-going. 

Testwork indicates a Nontronite Ore. A licensed alternate extraction technology is being evaluated. 

Croesus Mining NL is exploring adjoining tenements for gold under joint venture with Heron (refer Section 2.4.3 above). 

Heron anticipates that these joint venture tenements will have application for future infrastructure at the Lake Rebecca Nickel Project. 



2.0 Continued 

2.4.6 Karonie South Joint Venture Project 

Heron 100%. WMC Resources Limited right to earn 80% through spending $0.30m. 


The 666km 2 contiguous project area covering 9 tenements is located 140-170km SE of Kalgoorlie associated with 

the southern Keith Kilkenny Tectonic Zone. This structure hosts gold mineralisation from French Kiss and Karonie in 

the south through to Carasue and Old Plough Dam in the north. 

Heron’s aeromagnetic data for Karonie South confirms the presence of prospective Karonie gold mine structures 

(northeast splay faults and tight isoclinal folds), within a favourable mafic stratigraphy. Importantly the Aldiss Fault, 

which controls the distribution of mineralisation within the Karonie gold mining centre, extends into the Heron project 

area. Aeromagnetic interpretation has defined several major regional NE trending cross structures. 

Following commencement of the Joint Venture, WMC has 

completed a detailed 474 station, 1x1km grid gravity 

survey. This has provided excellent definition of the mafic 

and sedimentary packages of the Roe Hills and Karonie 

Greenstone Belts. The data has been processed to 

produce Bouger gravity images. 

E28/860 

6530000mN 

The data reveals a low intensity gravity unit in the western 

survey area, which represents the Archaean Mount 

Belches sedimentary formation. To the east of this is a 

major NNW trending gravity high that represents the mafic 

to ultramafic Roe Hills Greenstone Belt, with other eastparallel 

gravity highs interpreted as thrust repetitions of the 

Karonie Greenstone Belt, intercalated with sediments. The 

NNW trending gravity-high stratigraphy is cut by numerous 

NE trending structures interpreted as Lower Proterozoic 

aged Albany-Fraser deformation effects. 

Granites located in the northeast and the south of the 

survey area are represented as gravity lows, and a 

distinctive ENE Proterozoic dyke is a linear gravity high. 

Both of these features are favourable gold targets. 

E28/862 

E28/929 

E28/861 

6520000mN 

E28/665 

E28/1014 

6510000mN 

An ethnographic survey was completed, clearing the entire 

Joint Venture area in terms of ethnographic sites. 

The survey team consisted of registered claimants of the 

Narnoonbinya People. 

An orientation soil geochemical program has been 

completed, and RAB drilling is current to determine the 

regolith and geological profile. WMC expenditure to date is 

$0.1 million. 

E28/638 

6500000mN 

A further 691km 2 project area covering 4 tenement 

applications is currently subject to farm-out discussions. 

The target is the southern soil-covered extension of the 

Karonie Greenstone Belt into the Fraser Range area. 

470000mE 

400000mE 

6490000mN 

Figure 9- KARONIE SOUTH 

Bouger Gravity Image 

Photo Strip: The concrete plug next to the peg is used to cap the drill hole. After site rehabilitation, only the black PVC 

tube protrudes from the ground, as a marker of the hole’s position. When mining is ready to commence, the plugs will be 

removed, since the enclosing top-soil is used for rehabilitation works around the minesite. 

‘My Painting’ Kevin Banks “The left hand side is the country. It has many quondong trees in it. 

On the right hand side is the mine site with its spiral ramp into the earth.” 

page 26 



2.0 Continued 


2.5 MUNGARI PROVINCE 

GOLD and PLATINUM GROUP ELEMENT TARGETS. 

2.5.1 Mungari Northwest Joint Venture Project 

Heron 100%. Kundana Gold Pty Ltd right to earn 50% through spending $3m. 

Gold. 

The 2km 2 project area covering 2 tenements is located 35km WNW of Kalgoorlie within the Zuleika Shear Zone. This general area has 

been subject to intense exploration activity by Kundana Gold, with several recent high grade gold discoveries announced near the 

Kundana gold mining centre, notably the recent Raleigh discovery. Grant of the Joint Venture tenement is awaited. 

2.5.2 Mungari Northwest Project 


Platinum-gold. 

The 50km 2 project area covering 16 tenements is located 45km WNW of Kalgoorlie associated with the Zuleika Shear Zone. 

The central Mungari Northwest tenements contain extensive outcrop of the Powder Sill gabbro. The Powder Sill is a highly fractionated 

layered mafic intrusion that is hosted within the Black Flag Group sediments. The sill, a south-east plunging syncline reaches a 

maximum width of 2.8km within the Heron project area, before thinning substantially towards the south. 

Gold occurrences in the Mungari Northwest region are generally associated with the two major NW trending regional structures, being 

the Kunanalling and the Zuleika Shear Zones. Additionally, a NNE trending brittle fault system traverses the entire project area, being 

the Black Flag-Royal Standard Faults. These structures localise the Mount Pleasant gold mining centre 15km NNE. 

The prime host rock exploration target in Heron’s Mungari Northwest tenements is the Powder Sill, particularly iron-rich quartz 

granophyric upper phases. These are favourable hosts for gold mineralisation within layered intrusives in the Eastern Goldfields. 

A high resolution aeromagnetic survey was completed by Heron, and identified gabbroic lithologies and structures comparable to those 

hosting the White Foil mineralisation to the immediate south. Detailed geochemistry has been completed over the tenements with 

4,591 Auger holes drilled. All samples were assayed for Au and As generating a number of coherent Au and Au-As anomalies. Auger 

sampling was followed up with an extensive rock chip sampling program, with 134 samples collected. From these 23 were thin 

sectioned for petrographic description. 

Drilling was continuous throughout 1999 and 2000. Gold targets have been partially tested with 590 RAB drill holes completed, 

predominantly within Exploration Licence 16/121, for a total drill advance of 22,513 metres. In addition, 400 Aircore holes for 20,000m 

were completed. Anomalous intersections include 12m at 0.46g/t Au from 36m, 4m at 0.36g/t Au from 52m, and 4m at 0.35g/t Au 

from 56m, confirming alteration systems are present, but as yet no ore grade mineralisation. A series of 333 samples were analysed 

using Neutron Activation Analysis, ICP-AES and XRF multi-element geochemistry. A total of 42 elements were analysed, including 

gold. Expenditure to date at Mungari Northwest has been $0.64 million. 

Heron will continue to evaluate the project area as a Ni-Cu-PGE target, having commenced re-interpretation of the extensive Heron 

data base for PGE targets. A PGE joint venture proposal has been received and is being evaluated. 

Figure 10 - MUNGARI NORTHWEST PROJECT 

0 2500 

METRES 

Mungari NW Auger Soils 

Maximum Au (ppm) 

>0.05 (5) 

0.02 to 0.05 (27) 

0.015 to 0.02 (56) 

0.01 to 0.015 (225) 

0.007 to 0.01 (483) 

0.005 to 0.007 (717) 


2.0 Continued 

2.6 LEONORA LAVERTON PROVINCE 

GOLD JOINT VENTURES and NICKEL 

2.6.1 Laverton Nickel Project 

Heron 100%. Agreement has been reached where another entity will acquire the gold rights at Merolia. 

Nickel - gold. 

The 534km 2 project area covering 10 tenements is located in the Laverton District. The main nickel target is at 

Merolia-Mineral Patch Hill adjoining and immediately north along strike of the Coglia Well-Irwin Hills lateritic nickel 

prospects. From a GIS and literature review, the Merolia-Mineral Patch Hill ultramafic occurrence is associated with 

strong aeromagnetic anomalies, with previous drill-confirmed nickel laterite mineralisation. 

Detailed aeromagnetic coverage has been acquired, and interpretation completed to define zones with olivine 

adcumulate units. The Merolia-Mineral Patch Hill tenements are in their first year of grant. A 640x80m RC drilling 

program at Merolia-Mineral Patch Hill has been designed and field checking completed. Drilling will commence once 

the current Goongarrie area drilling has been completed. Tenement applications north of Laverton cover gold mining 

centres at Mulga Queen and King of Creation, which were acquired through pegging. Farm-out discussions in 

respect of gold rights on these targets are current. 

2.6.2 Laverton Joint Venture Project 

Heron 100%. Metex Resources NL right to earn 70% through spending $0.5m. 

Gold. 

The 30km 2 contiguous project area covering 2 tenements is located 15km WSW of Laverton immediately west of the 

Chatterbox Shear Zone. The project area surrounds the Hawks Nest-Mt Gooses gold mining centres. Excellent gold 

discoveries have been announced by the Metex-Delta Gold joint venture within their Chatterbox Shear Zone project, 

immediately east of the Heron Joint Venture ground. 

Metex advises that reinterpretation of gravity and aeromagnetic data has been completed and a number of targets 

generated. Geochemical orientation surveys have also been completed in areas of known mineralisation, trialing 

partial extraction gold techniques that could be used in areas of deeper cover, such those as occurring within the 

Joint Venture tenements. Expenditure to date has been $0.2 million. 

2.6.3 Mount Morgans Joint Venture Project 

Heron 100%. Metex Resources NL right to earn 70% through spending $0.2m. 

Gold. 

The 14km 2 project area covering 8 tenements is located 40km WSW of Laverton immediately west of the Mount 

Morgans-Korong Shear Zone. The main prospects are 5km NW along strike from the Mount Morgans gold mining 

centre, associated with an intra-greenstone granitoid. Aeromagnetic, DTMs, open file geological compilations and 

Vacuum and RAB drilling have been completed. A 13 hole RAB drilling program for 786m was completed, testing 

prominent stratigraphic magnetic anomalies for potential gold and base metal mineralisation. Results are awaited. 

Expenditure to date has almost reached $0.2 million. 

2.6.4 Victory Joint Venture Project 

Heron 100%. Farm-in partner right to earn 80%. 


The 23km 2 project area covering 6 tenements is located 50-120km NW of Leonora, adjoining the Marshall Pool nickel 

laterite resource, and Victory and Bannockburn gold mining centres. Following field mapping and sampling, Mining 

Lease applications have been lodged on resource targets at the Victory gold prospect and Doyle Well nickel laterite 

prospect. A further 42km 2 project area covering 3 tenement applications is located NE of Victory, immediately north 

along strike of the newly developing Thunderbox gold mining centre. Farm-out discussions are current. 

Photo Strip: Cotton bush, cotton sample bags, eucalyptus and acacia scrub. The Goongarrie and Kalpini ore zones are 

both almost 30km long. Rehabilitation is a key issue for Heron. 

‘The Mine Site’ Naomi Ellis “My painting is of an open pit mine. There is a road with a crack in the pit.” 

page 28 



2.0 Continued 


2.7 ILLAARA PROVINCE 

VOLCANOGENIC MASSIVE SULPHIDE EXPLORATION JOINT VENTURE, 

PLATINUM and NICKEL LATERITE. 

2.7.1 Lawrence Find Project 


Copper - zinc - gold - nickel - sulphur. 

120º 

120º20' 

-29º20' 

The 944km 2 contiguous project area covering 7 tenements and 

applications is located 170-320km NW of Kalgoorlie. The project 

covers the Illaara Greenstone Province over a continuous strike of 

120km. The project area is in its first year of grant. 

10km 

A review of all available exploration data within the area has identified 

several target areas, including a 30km strike “epithermal gold” soil anomaly 

and a 50m thick massive “VMS” gossan. Several under-explored gold 

occurrences occur throughout the project area, and a copper occurrence 

was drilled previously within the northern project area. 

Metzke 

Find Au 

-29º20' 

Upper cycle felsic volcanic exhalative units are extensive, and include 

chert, BIF and muscovite schist. Three target areas have to date been 

identified which warrant follow-up drill exploration: 

• Day Rock Prospect - Volcanogenic massive sulphide Cu-Zn-Au 

• Regional As-Sb-Bi-Se Anomalies - Epithermal Au 

• Central Felsic Volcanic Complex - Volcanogenic massive sulphide Cu-Zn-Au 

Multi element 

soil geochemistry 

anomaly 

Day Rock 

Cu, Zn, Au 

The Day Rock Prospect is a classic VMS setting, characterised by 

pyrite altered calc-alkaline acid volcanics, laminated massive sulphides, 

black shale ore-equivalent horizon, and possible proximal epiclastic 

lenses. The target sulphide stratigraphic horizon is up to 100m thick. 

A gossan is mapped over a 1,000m strike length, with every possibility 

of further continuity under cover. 

Regional As-Sb-Bi-Se Anomalies are interpreted by Heron to 

display a chemical association indicative of epithermal gold 

mineralisation. Spatially, this anomalism appears to be sourced from 

the central felsic to intermediate volcanic complexes. 

The well-developed linearity of the anomalies would indicate a 

stratigraphic control, and therefore a VMS association. A gold and 

pathfinder element anomaly over a 30km strike length is indicated. This 

target is largely untested by any form of drilling. 

Lawrence 

Find Au 

As-Sb-Bi-Se 

Soil Anomaly 

Chert, sediment, BIF 

Felsic volcanics / 

agglomerate 

Basalt 

Granite gneiss 

Granite 

Tenement Boundary 

-29º40' 

-30º 

The Central Felsic Volcanic Complex of the Illaara Greenstone Belt 

Figure 11 - LAWRENCE FIND PROJECT 

is conceptually favourable for VMS mineralisation. Regional mapping 

Geology, Tenements and Target 

indicates a lower felsic sequence appears to be the most prospective, 

due to mapped occurrences of sulphides. Fragmental units are noted 

to coarsen northwards, which would suggest a highly prospective volcanic vent complex in this direction. The polymetallic association 

of the Reindler Prospect within the central felsic to intermediate volcanic complex, in particular anomalous barium, is further 

encouragement for VMS mineralisation within the belt. The sulphide horizons within the project area (as evidenced by significant gossan 

occurrences) could represent a future strategic sulphur resource to assist nickel laterite processing by Heron. 

Heron has recently defined high priority nickel laterite targets in the western project area, which will be retained 100% by Heron. 

Prospector Jack Otway has introduced Heron to a prospective PGE target associated with a layered ultramafic complex within Heron’s 

southern project area. Jack discovered the prospect in the 1970s. His sampling confirms a layered anorthosite and pyroxenite setting. 

Soil geochemical follow up is planned once the application is granted. Jack has received a “spotters fee” and Heron otherwise retains 

all mineral rights. A joint venture offer is to hand for Lawrence Find, to further develop the defined Au and Cu-Zn targets. Under the 

offer, Heron retains the rights to nickel laterite, and would retain by-product sulphur from any future VMS smelting operation. 



2.0 Continued 

2.8 IDA FAULT PROVINCE 

NICKEL LATERITE and JOINT VENTURE GOLD. 

2.8.1 Snake Hill Joint Venture Project 

Heron 100%. Connemara Gold Mines Pty Ltd right to earn 70% through spending $0.3m. 


The 56km 2 project area covering 3 tenements is located 140km NW of Kalgoorlie immediately west of the Ida Fault. 

The recent gold discoveries by Croesus Mining NL 20km south at Davyhurst (Giles prospect) have upgraded the 

area’s gold prospectivity. The project area is immediately south along strike of the Four Corners and Cullens lateritic 

and sulphidic nickel prospects. 

Nickel and gold soil geochemical targets have been defined for RAB drill testing. Exploration expenditure to date is 

$0.12 million. 

2.8.2 Frances Lesley Project 

Heron 100%. Agreement has been reached where another entity will acquire the gold rights. 

Nickel. 

The 133km 2 contiguous project area covering 5 tenement applications is located 90km NW of Kalgoorlie at the 

convergence of the Ida Fault and Kunanalling Shear Zone. The Frances Lesley project area is 20km S of the Davyhurst 

gold mining centre within an area of active gold mining operations. Extensive old gold workings occur in the project area 

and are hosted by strongly pyritic sediments and basalt. Previous drilling has identified a quartz stockwork system 

hosted by pyritic meta-sediments. Intersections included 8m at 4.85g/t Au in RAB drilling, and 5m at 3.4g/t Au in RC 

drilling. Heron estimates an Inferred Mineral Resource of 93,000 tonne at 2.1g/t Au. 

The regional rift structural setting, olivine orthocumulate style of komatiite occurrence, and abundance of sulphidised 

black shales suggests a very good potential for nickel sulphide occurrences. This nickel sulphide target concept is 

Heron’s active exploration interest at Frances Lesley. Grant of tenements is awaited. 

2.8.3 Blister Dam Project 



The 27km 2 project area covering 13 tenements is located 70km NW of Kalgoorlie on the Zuleika Shear Zone. The 

area consists of an extensive sand cover between the Hawkins Find and Chadwin gold mining centres. 

The northern tenement area covers part of the Walter Williams and Siberia Formation ultramafics, where they are 

truncated by the Zuleika Shear Zone. Additional ultramafics (possibly stratigraphically younger flows than the Walter 

Williams Formation) are associated with the Zuleika - Kunanalling Shear Zones, and occur at Blister Dam as well as 

Frances Lesley and adjoining Heron tenements. 

A nickel laterite data review was completed. The shear zone ultramafics have historical drilling at various locations, 

however the best intercept recognised is 5m at 0.92% Ni. The narrow, structurally controlled rift setting is considered 

more prospective for sulphide nickel targets, in contrast to the broad sheet flow facies which favour nickel laterite. 

Aircore, RC and Diamond Drilling were completed at Blister Dam during 1999 and 2000, testing beneath the 

previously discovered supergene gold mineralisation. Broad zones of low order mineralisation (0.1-0.3g/t) suggest 

the presence of a large alteration system, with a peak intercept of 14m at 2.89g/t Au. 

Photo Strip: Quality sampling methods are the corner stone to reliable resource estimates. To this end, Heron has placed 

great emphasis on taking replicate field samples for check assays. Quality control standards are submitted with all 

analytical batches. 

‘Two Sides’ Cheynne Graham “This painting represents the two sides of mining. On the left is the natural environment. 

On the right are two old pits filled with water.” 

page 30 



2.0 Continued 


At Blister Dam, sub-vertical zones of altered feldspar-phyric basalt, with up to 10% sulphide (pyrite, pyrrhotite and arsenopyrite), silica 

flooding and textural destruction within mylonitic zones all confirm a favourable gold mineralised setting. 

An Aircore drilling program was designed to test four structural targets. A best intercept of 15m at 0.44/t Au from 35m was returned 

in BDA267 from within the Carnage Shear Zone. Anomalous results are listed as follows. 

Table 14 - BLISTER DAM PROJECT 

Aircore Drilling Significant Intersections 

Hole ID North East From To Interval Au Comment 

Local Local m m m g/t 

BDA228 49,850 18,650 35 47 12 0.33 carbonate alteration 

BDA235 50,300 18,850 20 25 5 0.10 

BDA237 50,200 18,850 10 15 5 0.10 

BDA267 50,200 19,320 35 50 15 0.44 Carnage Shear 

BDA273 50,100 19,520 15 20 5 0.10 

BDA277 50,000 19,520 10 20 10 0.12 

Potential exists for strike extensions of at least 600m to the anomalous zone, both east and west of the intercept in BD267. 

Heron’s exploration is now focussing on nickel laterite targets, restricted to an ultramafic horizon interpreted to correlate with the Walter 

Williams Formation. Proposed drill collars have been marked out and Ground Disturbance Application lodged. Previous drilling areas 

have been rehabilitated. 

Expenditure to date has been $0.3 million. Negotiations to farm-out the gold rights are current. 

2.8.4 Bullabulling Project 



The 188km 2 project area covering 

5 tenements is located 60km WSW of 

Kalgoorlie immediately east of the Ida 

Fault. The project area has an extensive 

soil cover. Aeromagnetic interpretation 

indicates the presence of ultramafic 

rocks with probable thrust repetitions. 

At the Dunnsville Prospect, Heron’s 

field reconnaissance has confirmed the 

presence of nickel laterite mineralisation. 

No previous drilling is apparent, although 

old costeans indicate excellent gold 

target settings, and some small-scale 

gold mining activity is evident. 

Exploration Licence applications are 

awaiting grant. 

Photo: Ready for action. The tray of the Managing Director’s Hilux. From left to right, spare gerry can, water 

bottle, all the sampling gear for soils, costeans and RC drilling, plus wooden claim pegs in case a mining lease 

needs to be pegged. 

All Heron vehicles are similarly set up. From safety viewpoint, the vehicles each carry a GPS, EPIRB and 

satphone for working in remoter areas. 



2.0 Continued 

2.8.5 Widgiemooltha Joint Venture Project 

Heron 100%. WMC Resources Limited right to earn 80% through spending $0.3m. 


The 150km 2 Widgiemooltha project area covering 4 tenement applications is located 120km SSE of Kalgoorlie within 

the southern extension of the Kunanalling and Zuleika Shear systems. Field reconnaissance confirms a Zuleika Shear 

Zone structural setting. 

The Pioneer Prospect covers the Mariners-Dordie Rocks nickel sulphide-hosting komatiite succession. The 

Pioneer komatiite has nickel sulphide occurrences to the immediate north along strike. 

The Larkinville Prospect covers the western synformal repetition of the nickel mine-hosting Spargoville ultramafic 

sequence. Larkinville surrounds several historical gold mining areas, and is north along strike from the Chalice gold mine. 

Heron’s geological reconnaissance and interpretation suggests the Pioneer and Larkinville ultramafic rocks are 

dominantly spinifex textured komatiite sheet-flows and channels, and accordingly are more prospective for nickel 

sulphide targets than nickel laterite. 

A Joint Venture offer has been received from WMC Resources on the Widgiemooltha tenements to appraise the nickel 

sulphide potential. In particular, a high priority nickel sulphide target has been generated at Pioneer, which will be drill 

tested on grant of the tenements. 

Farm-out discussions are current on a further 5 tenement applications covering 12km 2 at Yilmia Hill in the northern 

Spargoville-Widgiemooltha nickel mining field. An 800x100m MMI soil sampling program was completed by Heron. 

A coincident Au-Pd anomaly was generated, with 10.2ppb Au and 4.2ppb Pd. 

2.8.6 Mount Thirsty Project 


Nickel (-gold). 

The 12km 2 project area covering 9 tenements is located 12km N of Norseman. Previous drill testing of ultramafic units 

during gold exploration programs has intersected up to 10m at 0.8% Ni. Prospecting Licence applications are 

awaiting grant. 

2.9 KAMBALDA DOMAIN 

GOLD-NICKEL EXPLORATION 

2.9.1 Binduli East Project 

Heron 100%. AngloGold Australasia Limited right to earn 75% through spending $0.5m. 


The 35km 2 contiguous project area covering 14 tenements is located 10km SW of Kalgoorlie straddling the Abattoir 

Shear Zone. Dominant lithology is dolerite to the east of the Shear, and felsic volcaniclastic to the west. 

The project area is south along strike from the Janet Ivy gold resource, with the Binduli gold mining centre at the 

western project boundary. Both of these deposits are felsic hosted. The KCGM Superpit hosted by dolerite occurs 

8km E. Expenditure by Heron to date is $0.1 million, from soil and rock chip sampling. 

AngloGold has completed a review of Heron’s previous exploration, prior to commencing Auger soil sampling. 

Photo Strip: Eucalypt, acacia, eromophilia, quondong and sandalwood trees are widespread through the Goldfields 

woodlands. Quondong is highly valued for its bush tucker, and sandalwood for its aromatic timber. A drill site can always 

be moved a metre or two when there is a quondong or sandalwood tree near the proposed drill hole. 

‘The Emu’ Andrew Abdullah “At Binduli mine we saw lots of emus. The emus were looking for quondongs.” 

page 32 



2.0 Continued 


2.9.2 Kurramia Project 



The 105km 2 project area covering 13 tenements is located 10-30km N of Kalgoorlie 

associated with felsic volcaniclastics and lateritised ultramafics within the Boorara 

Shear Zone. An extensive lacustrine cover associated with Gidgi Lake is present in 

the northern project area. 

Tenement applications are awaiting grant. Heron granted Tribute Rights to a 

prospector syndicate, which has been exploring alluvial gold occurrences within the 

southern project area. No bedrock gold targets have as yet been generated from 

this work. 

Kanowna South Prospect 

Photo: Ian Buchhorn (Managing Director), Alan Rudd 

(Senior Geologist), David Crook (Exploration Manager). 

The tenement applications are located 3km S of Kanowna, some 20km NE of Kalgoorlie. 

The area is dominantly volcaniclastic sediments. Importantly, the Shamrock Ultramafic Sequence trends N-S through the project area, 

and is prospective for Silver Swan style nickel sulphide mineralisation. Intrusive porphyry, locally being a prime gold target, occurs 

throughout the tenements. A southern extension of the Kanowna Shear Zone is also interpreted as transecting the western tenement 

area, suggesting a Kanowna Belle target setting. 

Previous RAB drilling includes intersections of up to 1m at 0.95g/t Au. Regional Aircore drilling and limited RC drilling produced up to 

4m at 2.35g/t Au at the Phoenix Prospect. In view of the deep surface depletion zone, further drill testing is required. 

The similarity of the geological setting to the nearby Kanowna Belle gold mine means that very detailed drill exploration is warranted at 

the Kanowna South Prospect once the tenements are granted. Farm-in interest has been expressed. 

Roaster Prospect 

The tenement applications are located 15km N of Kalgoorlie associated with the Bardoc Tectonic Zone (northern extension of the 

Boorara Shear Zone). 

Sedimentary rocks of the Black Flag Group, interbedded with lesser mafic and porphyritic felsic rocks dominate the local geology. The 

sediments consist of epiclastic siltstone and carbonaceous shale. Evidence of old gold workings from the late 1800s and early 1900s 

exists. No record of production is available. 

Previous exploration of the tenement area includes aeromagnetic interpretation, an airborne Electro-Magnetic survey, a broad spaced 

gravity survey, geological and regolith mapping and interpretation, Auger sampling, several phases of follow up RAB drilling at the 

Roaster and Penghana Prospects, RC drilling at the Roaster and Penghana Prospects and regional Aircore-RAB drilling traverses. The 

geological setting is highly prospective for gold mineralisation. Heron’s main target is however nickel laterite associated with ultramafic 

units interpreted during the course of previous gold exploration. 

2.9.3 Mount Martin Project 



The 60km 2 project area covering 5 tenement applications is located 45km SE of Kalgoorlie, associated with the Boulder Lefroy Fault 

System to the west, and main Boorara Shear Zone to the east. The applications are precisely located on favourable structural and 

ultramafic targets in the area of the Blair nickel, Mount Martin gold-nickel and New Celebration-Jubilee gold mines. 

Tenement acquisition has been on the basis of the Woolibar Fault, which is a southern splay extension of the intensely mineralised 

Boorara Shear Zone. Alluvial gold production is widespread within and adjoining the Heron project area. From Heron’s initial geological 

reconnaissance, gold-prospective zones appear to have a direct dolerite association. 



2.0 Continued 

2.10 SOUTHERN CROSS PROVINCE 

IRON PRODUCTION ROYALTY, GOLD-NICKEL EXPLORATION 

2.10.1 Bungalbin Project 



The 708km 2 project area covering 7 tenement applications is located 100-130km NNE of Southern Cross. Dominant 

lithology is E-W trending ridges of banded iron formation (“BIF”). 

Lateritic nickel potential in footwall ultramafic units is indicated from Heron’s literature reviews. Follow up of the nickel 

target will commence once tenements are granted. 

Discussions are current for farming out the gold rights at Bungalbin. 

2.10.2 Bungalbin Iron Ore Project 

Heron 100%. Portman Limited right to acquire iron ore rights through spending $0.25m and providing Heron an 

Iron Ore Production Royalty. 

Heron retains all other mineral rights, notably gold-nickel. 

The 204km 2 project area covering 3 granted tenements is located 105km N of Southern Cross. Dominant lithology 

is an E-W trending ridge of BIF. The project area includes an iron ore Inferred Mineral Resource estimated from 

Heron’s open file study at 65.7 million tonne at 57.9% Fe, with a calcined grade of 64.1% Fe. Within this global 

resource, it is felt that good potential exists for smaller structurally controlled high grade iron-low phosphorus ore 

positions. The total BIF strike extent within the project area is 20km. 

Portman is completing a Bankable Feasibility Study which is expected to be ready within one year. The Study includes 

a possible railway spur-line to the Bungalbin iron ore deposit to supplement the Koolyanobbing iron ore operation. 

The target ore type at Bungalbin is low-phosphorous ore. Heron holds a Royalty entitlement over iron ore production 

from Bungalbin. The Royalty is not capped. 

2.10.3 Maggie Hays Hill Project 



The 81km 2 project area covering 1 tenement application is located 140km SE of Southern Cross. The dominant 

lithological target is a komatiite-basalt contact that trends NNW through the project area. 

Good potential exists for Maggie Hays-Emily Ann style structurally controlled massive nickel sulphide deposits. The 

Heron project area will require blanket ground Electro-Magnetic surveying over and along strike of all komatiite 

sequences. 

Lateritic nickel is recorded in previous RAB drilling from the southern tenement area, and is currently the prime 

exploration target for Heron. Follow up of the nickel targets will commence once the tenement is granted. 

Photo Strip: Fred Andrei has virtually single handedly surveyed each Heron drill hole, collected the drill samples, and then 

supervised the rehabilitation. Fred is a well-known local prospector, who contracts to Heron as a Field Supervisor. 

‘2000’ Derrick Sceghi “This is a painting of a mine. There are people working.” 

page 34 



2.0 Continued 


2.11 BREMER-EUCLA PALAEODRAINAGE PROVINCE 

OIL SHALE SCOPING STUDY. 

2.11.1 Balladonia and Ravensthorpe-Norseman Oil Shale Projects 


Oil shale – lignite – sulphur – limestone - heavy mineral sands – kaolin - vanadium. 

The 3,497km 2 Balladonia project area covering 20 tenement applications is located 20-180km E of Norseman. The 2,008km 2 

Ravensthorpe-Norseman project area covering 22 tenement applications is located from Norseman and SW to Ravensthorpe. The 

project areas cover Tertiary-aged palaeodrainages which are prospective for lignite resources. Heron has demonstrated these lignites 

to be oil shale bearing. From Landsat studies, the target basins are structurally controlled. Following a GIS study by Heron, some 

tenement rationalisation was completed, particularly where the target carbonaceous units were felt to be too thin or at excessive depth. 

With the dramatic increase in oil prices during 2000, Heron’s Oil Shale acquisition strategy of the last two years has been validated. 

Energy 

Resource estimates are qualitative at best, but from reviewing previous exploration data, there is a stated a potential of 1.5 billion tonne 

at a Fischer Oil Yield of 95 litre per tonne. The Balladonia lignite has a higher ash content and lower specific energy values than 

Victorian Tertiary brown coals, but is comparable to the Leigh Creek deposits being actively mined in South Australia. All of the Heron 

lignite resources have a high oil yield, being up to 190 litre per tonne. The oil yields are comparable to oil shale deposits in Queensland, 

which are now in production. The Bremer-Eucla Oil Shales are free of the environmental issues which relate to the Queensland 

projects, operating as they do within proximity to the Great Barrier Reef. 

Sulphuric Acid 

The Bremer-Eucla lignite is relatively pyritic. Following flotation and roasting, this pyrite would be suitable for sulphuric acid manufacture. 

Sulphuric acid is a major feedstock in nickel laterite processing. This sulphur requirement was the prime consideration for Heron 

acquiring the Bremer-Eucla Oil Shale tenements. The increase in oil price has now changed the commodity emphasis to oil. 

Oil Shale Scoping Study 

Heron is re-appraising its Scoping Study using the Balladonia West deposit as the conceptual ore model (high oil yield, low strip ratio, 

proximity to downstream energy users). The minimum economic Oil Shale target is felt to be: 

• Minimum oil yield of 100 litres per tonne. 

• Minimum resource 1 billion tonne. 

• Waste to ore less than 2.0. 

• Overburden depth not to exceed 25m. 

• Scale of operation 50,000 barrels per day of oil/diesel. 

• Mine life 20 years. 

Potential production of sulphur-free syncrudes from lignite by pyrolysis, gasification or hydrogenation is being assessed, with waste 

heat and tail gases of potential use for power generation. 

With the capital costs of such projects around A$2.0 billion, a major industrial end-user would need to be introduced at some stage 

to advance the Bremer-Eucla projects towards production. Development decisions will be made once the current Scoping Study has 

been finalised. 

The current study model involves a resource mined and milled at a rate of 22mtpa for at least 20 years, producing 50,000 barrels of 

oil per day. Products are likely to include hydrogen, low sulphur naptha and shale oil. Residual carbon and spent shale could be used 

to preheat and fuel the processing plant. The conceptual mining model involves 80 million bcm moved per annum at a strip ratio of 

1:1.6. After the initial excavations, overburden waste would be used to backfill exhausted mined out areas. 

Expressions of interest have been received, and a Memorandum of Understanding is being reviewed to evaluate various alternate 

technologies and development concepts. The comprehensive Heron data base has been made available for review at the Perth office 

of Heron’s Consultant, Paul Askins. Paul’s work on Heron’s Oil Shales has been outstanding. 



2.0 Continued 

Acknowledgement 

Heron has progressed the Goongarrie Project through from the initial aquisition in 1998, to the 800x80m 

reconnaissance drilling in 1999, to 80x80m infill drilling and finally to the Pre-Feasibility Study in 2000. Kalpini was 

similarly fast tracked. With a staff of five and a budget of $2.5 million per annum, the work output of Heron is 

unsurpassed. To Dave, Alan, Simon, Sue and Fred, many thanks indeed. 

1998 - Pegging of Goongarrie South 

Ian Buchhorn, pegging P29/1636, 1637, January 1998. 

2000 - Two years and 50,000m of RC 

drilling later, Goongarrie South Pit Design 

David Crook’s Pit Design generated inhouse. 

100m 

Pamela Jean 

Zone 

N 

Goongarrie Hill, Siliceous Ore 

Proposed Mullock Dump 

Goongarrie South, Limonite Ore 

Pamela Jean Zone 

Big Four, Limonite Ore 

Scotia, Siliceous Ore 

Gold Target 

Gold Target 

1999 - Goongarrie South 

General Arrangement Plan, showing target areas. 

DTM (Digital Terrain Model) shows the high grade Limonite Ore 

is in low lying areas (green hues) and low grade Siliceous Ore is in 

topographic highs (brown hues). 

Scotia Dam, 

Limonite Ore 

shallow, high grade Cobalt Ore 

I J Buchhorn 

MANAGING DIRECTOR 

The information is based on, and accurately reflects, information compiled by Ian James Buchhorn, who is a Member 

of the Australasian Institute of Mining and Metallurgy. 

Photo Strip: Heads down and tails up, the Heron way. 

Opposite page: Goongarrie historical town plan, courtesy of the Eastern Goldfields Historical Society. The work of the 

Historical Society ensures that these plans and other historical documents are preserved. 

page 36 



Statutory Information 

Heron Resources NL page 37 

3.0 Corporate Profile 38 

Corporate Governance Practices 38 

4.0 Directors’ Report 40 

5.0 Financial Statements 45 

Profit And Loss Account 45 

Balance Sheet 46 

Statement Of Cash Flows 47 

Notes To And Forming Part Of The Accounts 48 

Directors’ Declaration 60 

6.0 Independent Audit Report 61 

7.0 Shareholder Information 62 

8.0 Interest In Mining Tenements 65 

Glossary of Terms 79 

Heron Resources NL Annual Report 2000


Corporate Profile 

3.0 Corporate Profile 

Heron Resources NL is a Kalgoorlie-based exploration and development company. The corporate aim is to become a 

profitable mining company through the development of mineral deposits. Heron is focused on the exploration and 

development of its nickel laterite projects in the Eastern Goldfields of Western Australia. 

The Company undertakes cost-effective exploration based on literature reviews, aeromagnetic interpretation, and ore 

resource drill testing of targets so generated. 

The management of the Company is based in Kalgoorlie. Accordingly, the Company has excellent access to tenement 

acquisition opportunities, and to specialist contractor services. Administrative overheads are also maintained at lower levels 

due to the Kalgoorlie base. 

The Company is managed and staffed by a team of five professional geoscientists with extensive industry experience. 

Specialist consultants are used as required, particularly in disciplines where future project due diligence may be required. 

Field programs such as drill rig access, drill site rehabilitation and hydrological monitoring are implemented under long-term 

contracts to experienced operators. 

OBJECTIVES 

a) To convert the existing nickel laterite mineral resources into profitable mining operations for the Company; 

b) To increase the value of the Company through the continued acquisition, exploration and development of mineral 

resources; 

c) To establish mining cash flows that increase the Company’s market capitalisation and value to Shareholders; 

d) To conduct operations in a safe and environmentally responsible manner, to offer employment opportunities to those 

who live in the exploration provinces, and to respect and nurture the Indigenous culture of the exploration provinces; and 

e) Manage the risk in all exploration, development and corporate endeavours. 

STRATEGY 

a) Acquire the maximum available equity in nickel laterite and associated commodity projects through pegging, optioning 

or outright purchase, concentrating within the Eastern Goldfields of Western Australia; 

b) Focus on cost-effective drill exploration to convert exploration targets into mineral resources; 

c) Location of the corporate base at Kalgoorlie within the principal area of operation; 

d) Active acquisition and testing of new exploration concepts and targets, such as the Bremer-Eucla oil shale project; 

e) Use of best management, technical and financial control techniques; and 

f) Utilise farm-outs where appropriate to spread exploration and commodity risk. 

CORPORATE GOVERNANCE PRACTICES 

General 

The Company does not have any formally constituted committees of the Board of Directors. The Company is not of a size 

nor are its affairs of such complexity to justify the formation of separate or special committees. The Board as a whole is able 

to address the governance aspects of the full scope of the Company’s activities and to ensure that it adheres to appropriate 

ethical standards. 

page 38 Heron Resources NL Annual Report 2000

Corporate Profile 3.0 Continued page 39 

Composition of the Board 

At the date of this statement the Board comprises four Directors, three of whom are non executive Directors. The names, 

qualifications and relative experience of each Director are included in the Directors’ Report, Section 4.0. 

The Company’s Articles provide that the number of Directors shall not be less than three and not more than nine (Article 19.1). 

There is no requirement for any Share holding qualification although it is preferable that Directors will become significant 

Shareholders. An Employee Option Plan has been in operation to encourage Directors to take significant Shareholdings. 

As the Company’s activities increase in their size, nature and scope, the size of the Board will be reviewed periodically and the 

optimum number of Directors required to adequately supervise the Company’s activities determined within the limitations imposed 

by the Articles and as circumstances demand. 

Board Membership 

The membership of the Board, its activities and composition is subject to periodic review. The criteria for determining the 

appointment of a suitable candidate for the Board shall include the quality of the individual, experience and achievement, 

compatibility with other Board members, credibility within the Company’s scope of activities and the mining industry, intellectual 

ability to contribute to the Board’s duties and physical ability to undertake the Board’s duties and responsibilities. 

Under the Company’s Articles the tenure of the Directors (other than the Managing Director) is subject to re-appointment by 

Shareholders not later than the third anniversary following their last appointment (Article 19.7). The Board does not subscribe to 

the principle of a retirement age and there is no maximum period of service as a Director. 

Appointment to Other Boards 

Directors are required to take into consideration any conflicts when accepting appointment to other boards. Accordingly, 

Directors wishing to accept appointment to other boards must first seek approval from the Board, approval of which will not 

unreasonably be withheld. 

Directors’ Remuneration 

At the date of this statement the maximum per annum total amount payable to Directors as Director’s fees was set by 

Shareholders at a general meeting on 21 June 1996 at $100,000. 

No Director’s fees are paid to the Managing Director, who receives a salary approved by the Board. 

Independent Support 

The Board has determined that individual Directors may in appropriate circumstances engage outside advisers at the Company’s 

expense. The engagement of an outside adviser is subject to the prior approval of the Board, approval of which will not 

unreasonably be withheld. 

Compensation Arrangements 

The Board is responsible for reviewing compensation arrangements (including superannuation and other benefits) for the 

Managing Director and other senior executives. 

Continuous Review of Corporate Governance 

Directors consider on an ongoing basis how management information is presented to them and whether such information is 

sufficient to enable them to discharge their duties as Directors of the Company. Such information must be sufficient to enable 

Directors to determine appropriate operating and financial strategies from time to time in light of changing circumstances and 

economic conditions. 

The Directors recognise that mineral exploration has inherent risks and that operational strategies adopted should, 

notwithstanding, be directed towards improving the value of the net worth of the Company. 



Directors’ Report 

4.0 Directors’ Report 

The Directors submit their Report on the operations of the Company and its controlled entities for the year ended 30 June 

2000 including the accounts for the financial year ended on that date in accordance with a resolution of the Directors of the 

Company. 

DIRECTORS 

The names and details of the Directors of the Company in office at any time during or since the end of the year are: 

Director 

Rodney Michael Evans - FCA, FCIS, FCIM, AIArbA 

Appointed 26 March 1996 

Position 

Chairman (Non-Executive) 

Rod Evans is a chartered accountant and consultant who has had wide experience in corporate administration 

and finance. Mr Evans is a Director and Chairman of RAC WA Holdings Pty Ltd and RAC Finance Limited, 

and a past Chairman of Clark Kenneth Leventhal a world-wide association of accounting firms, the Australian 

Automobile Association, and a number of publicly listed companies involved in mining and exploration in 

Australia. 

Director 

Ian James Buchhorn - BSc (Hons), Dip Geosci, MAusIMM 

Appointed 17 February 1995 

Position 

Managing Director 

Ian Buchhorn is a Mineral Economist and Geologist. He has worked on nickel, gold, lead-zinc and diamond 

projects in southern Africa. In Australia, Mr Buchhorn has worked on bauxite and industrial mineral mining and 

exploration, gold and base metal project generation, gold mine operation and in corporate evaluations. He has 

27 years’ experience as an economic geologist, and for the last 14 years, has acquired and developed 

projects throughout the Eastern Goldfields of Western Australia, commissioned several open cut gold mines, 

and has been a Registered Mine Manager. Mr Buchhorn is responsible for the day to day technical 

management of the Company. He is active within the local community, serving as a Councillor for the City of 

Kalgoorlie-Boulder. 

Director 

Robert George Colville - AssocRMIT, MAusIMM 

Appointed 09 December 1996 

Position 

Director (Non-Executive) 

Bob Colville has over 28 years’ exploration experience predominantly within the Eastern Goldfields of Western 

Australia. Mr Colville has held a number of senior and executive positions with both major companies and 

junior explorers. He has been associated with the discovery and development of mines at Ranger Uranium 

(NT), and New Celebration, Goongarrie and Davyhurst (Eastern Goldfields WA). Mr Colville is an executive 

director of Barminco Pty Ltd, the largest private underground mining contractor in Australia. 

Director 

Peter James Lee - BBus, CA, FCIS, MAICD 

Appointed 26 May 2000 

Position 

Director (Non-Executive) 

Peter Lee joined Centaur Mining & Exploration Limited in June 1987 and is currently company secretary of 

Centaur. Mr Lee has over 20 years’ experience in the accounting, company secretarial and commercial fields 

in both Australia and overseas. Mr Lee has been involved in the development and introduction of a number 

of corporate issues including registration of several companies in the United States of America, chairing due 

diligence committees, preparation of prospectuses and takeover documents and project management. Prior 

to joining Centaur, Mr Lee spent six years with PriceWaterhouse in Melbourne and Papua New Guinea. 



4.0 Continued page 41 

Ken Hellsten was appointed as a Director on 17 September 1999. Mr Hellsten was the Centaur Nickel Pty Limited and Centaur 

Mining & Exploration Limited ("Centaur") nominee to the Board pursuant to the Strategic Alliance Agreement between Heron and 

Centaur. Mr Hellsten resigned on 26 May 2000 following which Peter James Lee was appointed as Centaur’s nominee pursuant 

to the Strategic Alliance. 

PRINCIPAL ACTIVITIES 

The principal activities of the economic entity during the year were: 

a) Lateritic nickel mineral exploration and development; and 

b) Various non-nickel mineral exploration activities, often implemented through farm-out. 

There has been no significant change in the nature of these activities during the year. 

OPERATING RESULTS 

The consolidated loss of the economic entity for the 2000 financial year after income tax of nil (1999 : nil) was $535,636 

(1999 : $5,680,473). 

DIVIDENDS 

No dividends were paid during the year and the Directors do not recommend the payment of a dividend. 

OPERATIONS REVIEW 

The detailed Operations Review of the economic entity for the year is contained in Section 2.0 of this Annual Report. 

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS 

Other than noted below there were no significant changes in the state of affairs of the economic entity during the year. 

On 17 September 1999 the Company entered into a Strategic Alliance Agreement with Centaur Mining & Exploration Limited. 

The Alliance supports the planned Stage II expansion of the Cawse Nickel Project to a production level of more than 40,000 

tonnes per annum of LME grade nickel. Pursuant to the Agreement the Company received $3,132,000 and granted Centaur 

Mining & Exploration Limited an option, at no additional cost, to call for the issue of 10,440,000 Shares in the Company. 

On 28 September 1999 Centaur Mining & Exploration Limited called for the issue of the 10,440,000 Shares, which Shares have 

since been issued. 

There were no significant changes in the state of affairs of controlled entities during the year. 

MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR 

Other than mentioned below at the date of this Report there is no matter or circumstance which has arisen since 30 June 2000 

that has significantly affected or may significantly affect: 

a) The operations, in the financial years subsequent to 30 June 2000, of the economic entity; 

b) The results of those operations; or 

c) The state of affairs, in the financial years subsequent to 30 June 2000, of the economic entity. 

In June 2000 Optionholders of the Company exercised 10,000,000 Options at 25 cents each which were to expire on 30 June 

2000 and 150,000 Options at 25 cents each which were to expire on 15 December 2001. Shares were allotted and issued to 

Optionholders on 13 July 2000. 


4.0 Continued 


OPTIONS 

10,150,000 Options in the Company were exercised during the year. 

1,000,000 Options were issued by the Company during the year. 

As at 30 June 2000 the Company had the following Options on issue: 

Number Issued Expiry Date Exercise Price 

125,000 28 August 2001 25 cents 

150,000 01 September 2001 25 cents 

350,000 15 December 2001 25 cents 

65,000 05 March 2002 25 cents 






1,690,000 

LIKELY DEVELOPMENTS 

The Company will continue its core nickel development activities through sole funded exploration and joint ventures where 

appropriate. Inferred Mineral Resources at Goongarrie are being drilled out to an Indicated status for the Cawse Stage II 

Bankable Feasibility Study to be completed by Centaur Mining & Exploration Limited on or before 19 August 2001. 

The Company is continually assessing commercial opportunities for corporate growth. Because of the unpredictable nature 

of these opportunities, developments could occur at short notice. 

Further information is not included on the likely developments in the operations of the economic entity and the expected 

results of those operations, as it is the opinion of the Directors that this would prejudice the interests of the economic entity 

if included in this Report. 

DIRECTORS’ BENEFITS 

Disclosure of benefits provided to Directors during the financial year is made in Notes 14 and 16 of the financial statements, 

in accordance with ASC class order 98/2395. 

DIRECTORS’ INTEREST IN CONTRACTS WITH THE COMPANY 

There are no material contracts involving Directors’ interests at the end of the financial year nor have any been entered into 

since the end of the previous financial year not otherwise disclosed in this Report. 

DIRECTORS’ SHAREHOLDING IN THE COMPANY 

As at the date of this Report the interests of the Directors in the Shares of the Company were: 

Director Ordinary Shares Options over Ordinary Shares 

Direct Indirect Direct Indirect 

R M Evans - 800,000 - 200,000 

I J Buchhorn 2,447,857 28,221,998 1,000,000 - 

R G Colville - 140,000 - 150,000 

P J Lee - - - - 




DIRECTORS MEETINGS 

During the year the Company held 10 meetings of Directors. The attendance of the Directors at meetings of the Board were: 

Director Meetings held Number of 

while a Director meetings 

attended 

R M Evans 10 10 

I J Buchhorn 10 10 

R G Colville 10 9 

KJ Hellsten (resigned 26 May 2000) 6 6 

PJ Lee (appointed 26 May 2000) 1 1 

EMOLUMENTS OF DIRECTORS AND SENIOR EXECUTIVES 

Executive remuneration and other terms of employment are reviewed by the Board on an ongoing basis having regard to 

performance against goals set at the start of the year, the relevant comparative information and independent expert advice. 

Remuneration packages are set at levels that are intended to attract and retain executives capable of managing the economic 

entity’s operations. 

Director Salary Directors Superannuation Other Options 

Fees 

$ $ $ $ $ 

R M Evans - - 43,938 - - 

I J Buchhorn 130,000 - 20,000 - 60,000 

R G Colville - 20,000 1,400 - - 

K J Hellsten - 13,337 934 - - 

P J Lee - 1,663 116 - - 

Senior Executive 

D J Crook 90,118 - 29,880 30,002 - 

Mr Crook is the only employee of the economic entity qualifying as a Senior Executive. 

1,000,000 Options in the parent entity were issued to Ian James Buchhorn during the year as approved by Shareholders at the 

Company’s 1999 Annual General Meeting on the following terms: 







The value of the 1,000,000 19 December 2002 Options issued to I J Buchhorn is calculated to be $60,000. 


4.0 Continued 


AUDIT COMMITTEE 

At the date of this Report the Company has not formed an Audit Committee. The Directors discuss the Company’s activities 

with the auditors throughout the year. Due to the size and nature of operations, it has not been considered necessary to 

form an Audit Committee of the Board of Directors. 

INSURANCE OF OFFICERS 

During the financial year the Company has paid an insurance premium in respect of a Directors’ and Officers Liability 

Insurance Contract. The insurance premium relates to liabilities that may arise from an officer’s position, with the exception 

of conduct involving a wilful breach of duty or improper use of information or position to gain personal advantage. 

The officers covered by the insurance policies are the Directors and the Company Secretary. 

CORPORATE GOVERNANCE 

In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of Heron Resources NL 

support and have adhered to the principles of corporate governance. The economic entity’s corporate governance statement is 

contained in the Section 3.0 Corporate Profile of the Annual Report. 

ENVIRONMENTAL REGULATION 

The economic entity is subject to and compliant with all aspects of environmental regulation in respect of its exploration 

activities. The Directors are not aware of any environmental regulation which is not being complied with. 

ABORIGINAL CULTURE AND HERITAGE 

The economic entity is subject to and compliant with all aspects of Aboriginal Heritage regulation in respect of its exploration 

and development activities. The Directors are not aware of any regulation which is not being complied with. The Directors 

are committed to cultural respect and Indigenous Reconciliation. 

Signed in accordance with a resolution of Directors 

R G COLVILLE 

Director 

Perth, 29 September 2000 



Financial Statements 

5.0 Financial Statements 

PROFIT AND LOSS ACCOUNT 

FOR THE YEAR ENDED 30 JUNE 2000 

Economic Entity 

Parent Entity 

Notes 2000 1999 2000 1999 

$ $ $ $ 

REVENUE 2(c) 171,718 149,287 171,718 149,287 

OPERATING LOSS BEFORE ABNORMAL 

ITEMS AND INCOME TAX (535,636) (539,483) (535,636) (539,483) 

ABNORMAL ITEMS BEFORE INCOME TAX 3 - (5,140,990) - (5,140,990) 

OPERATING LOSS BEFORE INCOME TAX (535,636) (5,680,473) (535,636) (5,680,473) 

INCOME TAX ATTRIBUTABLE TO 

OPERATING LOSS 4 - - - - 

OPERATING LOSS AFTER INCOME TAX (535,636) (5,680,473) (535,636) (5,680,473) 

ACCUMULATED LOSSES at the beginning 

of the financial year (6,770,768) (1,090,295) (6,770,768) (1,090,295) 

ACCUMULATED LOSSES at the end 

of the financial year (7,306,404) (6,770,768) (7,306,404) (6,770,768) 

The accompanying notes form part of these financial statements 

Heron Resources NL Annual Report 2000 

page 45

5.0 Continued 


BALANCE SHEET 

AT 30 JUNE 2000 


Parent Entity 


$ $ $ $ 

CURRENT ASSETS 

Cash 3,925,296 1,286,067 3,925,286 1,286,067 

Receivables 5 6,661 4,289 6,661 4,289 

TOTAL CURRENT ASSETS 3,931,957 1,290,356 3,931,947 1,290,356 

NON-CURRENT ASSETS 

Receivables 6 - - 363,346 - 

Investments 7 - - 10 - 

Property, plant and equipment 8 117,632 166,135 117,632 166,135 

Exploration and evaluation costs carried forward 9 10,263,600 7,681,825 9,900,254 7,681,825 

TOTAL NON-CURRENT ASSETS 10,381,232 7,847,960 10,381,242 7,847,960 

TOTAL ASSETS 14,313,189 9,138,316 14,313,189 9,138,316 

CURRENT LIABILITIES 

Accounts payable 10 172,323 14,614 172,323 14,614 

Provisions 11 77,769 64,469 77,769 64,469 

TOTAL CURRENT LIABILITIES 250,092 79,083 250,092 79,083 

TOTAL LIABILITIES 250,092 79,083 250,092 79,083 

NET ASSETS 14,063,097 9,059,233 14,063,097 9,059,233 

SHAREHOLDERS’ EQUITY 

Share capital 12 21,369,501 15,830,001 21,369,501 15,830,001 

Accumulated losses (7,306,404) (6,770,768) (7,306,404) (6,770,768) 

TOTAL SHAREHOLDERS’ EQUITY 14,063,097 9,059,233 14,063,097 9,059,233 



5.0 Continued 


STATEMENT OF CASH FLOWS 



Parent Entity 


$ $ $ $ 

CASH FLOWS FROM OPERATING ACTIVITIES 

Interest received 161,007 83,844 161,007 83,844 

Proceeds from sale of tenements 15,000 67,500 15,000 67,500 

Payments to suppliers (619,699) (531,218) (619,699) (531,218) 

NET CASH OUTFLOWS FROM 

OPERATING ACTIVITIES 13(a) (443,692) (379,874) (443,692) (379,874) 

CASH FLOWS FROM INVESTING ACTIVITIES 

Exploration expenditure (2,454,234) (2,030,861) (2,090,888) (2,030,861) 

Acquisition of plant & equipment (2,355) (20,940) (2,355) (20,940) 

NET CASH OUTFLOWS FROM 

INVESTING ACTIVITIES (2,456,589) (2,051,801) (2,093,243) (2,051,801) 

CASH FLOWS FROM FINANCING ACTIVITIES 

Loan to controlled entity - - (363,346) - 

Proceeds from issue of shares 5,669,510 1,250,000 5,669,500 1,250,000 

Share issue costs (130,000) - (130,000) - 

NET CASH INFLOWS FROM FINANCING ACTIVITIES 5,539,510 1,250,000 5,176,154 1,250,000 

NET INCREASE / (DECREASE) IN CASH HELD 2,639,229 (1,181,675) 2,639,219 (1,181,675) 

Cash at the beginning of the financial year 1,286,067 2,467,742 1,286,067 2,467,742 

CASH AT THE END OF THE FINANCIAL YEAR 13(c) 3,925,296 1,286,067 3,925,286 1,286,067 

Non-cash financing and investing activities 13(b) 176,841 30,000 176,841 30,000 



page 47

5.0 Continued 


NOTES TO AND FORMING PART OF THE ACCOUNTS 


NOTE 1. 

STATEMENT OF ACCOUNTING POLICIES 

The financial statements are a general purpose financial report that has been prepared in accordance with applicable 

Accounting Standards and other mandatory professional reporting requirements (Urgent Issues Group Consensus Views) 

and the Corporations Law. The financial statements have been prepared on the basis of historical costs and do not take into 

account changing money values or, except where stated, current valuations of non-current assets. The accounting policies 

have been consistently applied, unless otherwise stated. 

The following is a summary of the material accounting policies adopted by the economic entity in the preparation of the 

financial statements. 

a) Principles of Consolidation 

The consolidated accounts comprise the accounts of Heron Resources NL and its controlled entities. A controlled entity 

is any entity controlled by Heron Resources NL. Control exists where Heron Resources NL has the capacity to dominate 

the decision making in relation to the financial and operating policies of another entity so that the other entity operates 

with Heron Resources NL to achieve the objectives of Heron Resources NL. A list of controlled entities is contained in 

Note 22. 

All inter-company balances and transactions between entities in the economic entity, including any unrealised profits or 

losses, have been eliminated on consolidation. 

Where controlled entities have entered or left the economic entity during the year, their operating results have been 

included from the date of control was obtained or until the date control ceased. 

Outside interests in the equity and results of the entities that are controlled are shown as a separate item in the 

consolidated financial report. 

b) Income Tax 

The economic entity adopts the liability method of tax-effect accounting whereby the income tax expense shown in the 

profit and loss account is based on the operating profit before income tax adjusted for any permanent differences. 

Timing differences which arise due to the different accounting periods in which items of revenue and expense are 

included in the determination of operating profit before income tax and taxable income are brought to account as either 

a provision for deferred income tax or an asset described as future income tax benefit at the rate of income tax applicable 

to the period in which the benefit will be received or the liability will become payable. 

Future income tax benefits are not brought to account unless realisation of the asset is assured beyond any reasonable 

doubt. Future income tax benefits in relation to tax losses are not brought to account unless there is virtual certainty of 

the realisation of the benefit. 

The amount of benefits brought to account or which may be realised in the future is based on the assumption that no 

adverse change will occur in income tax legislation and the anticipation that the Company will derive sufficient future 

assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law. 

c) Exploration, Evaluation and Development Expenditure 

Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area of interest. 

Accumulated costs are only carried forward to the extent that they are expected to be recouped through the successful 

development of the area, or by its sale, or where the activities in the area have not reached a stage which permits a 

reasonable assessment of the existence of economically recoverable reserves. 

Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the decision 

to abandon the area is made. 

Accumulated costs are not carried forward in respect of any area of interest unless rights to tenure of that area are current. 


5.0 Continued 


d) Investments 

Investments are brought to account at cost or at Directors’ valuation. The carrying amount of investments is reviewed 

annually by Directors to ensure it is not in excess of the recoverable amount of these investments. 

e) Depreciation 

Depreciation is calculated on a straight line or diminishing value basis to write off the net cost of each item of property, plant 

and equipment over its expected useful life. Rates of depreciation are 15% for motor vehicles, 15% to 100% for plant & 

equipment and 20% to 36% for office furniture and equipment. 

f) Interests in Joint Ventures 

The economic entity’s share of the assets, liabilities, revenue and expenses of joint ventures is included in the appropriate 

items of the balance sheet and the profit and loss account. 

Details of the joint ventures are set out in Note 21. 

g) Employee Entitlements 

Liabilities for wages and salaries, annual leave and sick leave are recognised and are measured as the amount unpaid at 

the reporting date at current pay rates in respect of employees’ service up to that date. 

h) Cash 

For the purposes of the statement of cash flows, cash includes cash on hand and in banks, and money market investments 

readily convertible to cash within two working days, net of outstanding bank overdrafts. 

i) Acquisition of Assets 

The cost method of accounting is used for all acquisitions of assets regardless of whether shares or other assets are 

acquired. Cost is determined as the fair value of the assets given up at the date of acquisition plus costs incidental to the 

acquisition. Where shares are issued in an acquisition, the value of the shares is determined by reference to the fair value 

of the assets acquired, including goodwill where applicable. 

Costs relating to the acquisition of new areas of interest are classified as either exploration and evaluation expenditure, 

development properties or mine properties based on the stage of development reached at the date of acquisition. Assets 

acquired may also include mineral reserves, mineral resources and unexplored and unevaluated acreage. 

Where settlement of any part of a cash consideration is deferred, the amounts payable in the future are discounted to their 

present value as at the date of acquisition. The discount rate used is the rate at which a similar borrowing could be obtained 

under comparable terms and conditions. 

A liability for restructuring costs is recognised as at the date of acquisition of an entity or part thereof when there is a 

demonstrable commitment to a restructuring of the acquired entity and a reliable estimate of the amount of the liability can 

be made. 

j) Recoverable Amount of Non-Current Assets 

The recoverable amount of an asset is the net amount expected to be recovered through the net cash inflows arising from 

its continued use and subsequent disposal. 

Where the carrying amount of a non-current asset is greater than its recoverable amount the asset is revalued to its 

recoverable amount. Where the net cash inflows are derived from a group of assets working together, recoverable amount 

is determined on the basis of the relevant group of assets. To the extent that a revaluation decrement reverses a revaluation 

increment previously credited to, and still included in the balance of the asset revaluation reserve, the decrement is debited 

directly to that reserve. Otherwise the decrement is recognised as an expense in the profit and loss account. 

The expected net cash flows included in determining recoverable amounts of non-current assets are discounted to their 

present values using a market-determined, risk adjusted discount rate. 


page 49

5.0 Continued 


k) Trade and Other Creditors 

These amounts represent liabilities for goods and services provided to the economic entity prior to the end of the 

financial year and which are unpaid. These amounts are unsecured and are usually paid within 30 days of recognition. 

l) Receivables and Revenue Recognition 

Bills of Exchange 

Bills of Exchange have been purchased in the market at a discount to face value. The Bills are carried at an amount 

representing cost and a portion of the discount recognised as income on an effective yield basis. The discount brought 

to account each period is accounted for as interest received. 

m) Earnings per Share 

i) Basic Earnings per Share 

Basic earnings per Share is determined by dividing the operating profit/(loss) after income tax by the weighted 

average number of ordinary Shares outstanding during the financial year, adjusted for bonus elements in ordinary 

Shares issued during the year. 

ii) 

Diluted Earnings per Share 

Diluted earnings per Share adjusts the figures used in the determination of basic earnings per Share by taking into 

account amounts unpaid on ordinary Shares and Options and any reduction in earnings per Share that will probably 

arise from the exercise of Options outstanding during the financial year. 


Parent Entity 

2000 1999 2000 1999 

$ $ $ $ 

NOTE 2. 

OPERATING LOSS 

The operating loss before income tax is arrived at after: 

a) Charging as Expenses: 

Depreciation 50,858 48,761 50,858 48,761 

Loss on sale of tenements - 77,563 - 77,563 

Employee entitlements 1,330 1,623 1,330 1,623 

Exploration expenditure written off 29,354 - 29,354 - 

b) Crediting as Income: 

Interest received from other persons 156,718 81,787 156,718 81,787 

c) Revenue: 

Other revenue 

Interest received 156,718 81,787 156,718 81,787 

Proceeds from sale of tenements 15,000 67,500 15,000 67,500 

171,718 149,287 171,718 149,287 


5.0 Continued 



Parent Entity 


$ $ $ $ 

NOTE 3. ABNORMAL ITEMS 

Included in the operating loss after tax is the 

following abnormal item: 

Exploration expenditure written off - 5,140,990 - 5,140,990 

NOTE 4. INCOME TAX 

Prima facie income tax benefit on operating loss 

reconciles to the income tax expense as follows: 

Operating loss before tax (535,636) (5,680,473) (535,636) (5,680,473) 

Prima facie tax at 36% (192,829) (2,044,970) (192,829) (2,044,970) 

Non deductible items 62,492 1,728,904 62,492 1,728,904 

Timing differences and tax losses not brought 

to account 130,337 316,066 130,337 316,066 

Income tax expense - - - - 

The Directors estimate the potential tax losses and section 330 exploration expenditure deduction entitlements available to the 

economic entity to be $7,748,391 (1999 : $5,119,000). 

The future income tax benefit arising from tax losses has not been recognised as an asset because recovery is not virtually 

certain. 

The tax benefits will only be obtained if: 

a) The economic entity derives future assessable income of a nature and of an amount sufficient to enable the benefit from the 

deductions for the losses to be realised; 

b) The economic entity continues to comply with the conditions for deductibility imposed by tax legislation; and 

c) No changes in tax legislation adversely affect the economic entity in realising the benefit from the deductions for losses. 

NOTE 5. RECEIVABLES (CURRENT) 

Accrued interest - 4,289 - 4,289 

Goods & Services Tax Paid 6,661 - 6,661 - 

6,661 4,289 6,661 4,289 

NOTE 6. RECEIVABLES (NON CURRENT) 

Loan to controlled entity - - 363,346 - 

- - 363,346 - 

NOTE 7. INVESTMENTS IN CONTROLLED ENTITIES 

Shares in controlled entities – at cost (Note 22) - - 10 - 

- - 10 - 


page 51

5.0 Continued 



Parent Entity 


$ $ $ $ 

NOTE 8. PROPERTY PLANT 

AND EQUIPMENT 

Plant and equipment at cost 62,605 61,576 62,605 61,576 

Accumulated depreciation (48,995) (31,480) (48,995) (31,480) 

13,610 30,096 13,610 30,096 

Office equipment & furniture at cost 24,251 22,925 24,251 22,925 


9,626 15,244 9,626 15,244 

Motor vehicles at cost 176,168 176,168 176,168 176,168 


94,396 120,795 94,396 120,795 

Total property, plant and equipment 117,632 166,135 117,632 166,135 

NOTE 9. EXPLORATION AND EVALUATION 

COSTS CARRIED FORWARD 

Balance at beginning of year 7,681,825 11,072,712 7,681,825 11,072,712 

Acquisition costs 350,286 381,215 350,286 381,215 

Exploration and evaluation costs incurred 2,260,843 1,513,951 1,897,497 1,513,951 

during the year 

Exploration and evaluation costs of mining - (145,063) - (145,063) 

tenements disposed of 

Exploration and evaluation costs written off (29,354) (5,140,990) (29,354) (5,140,990) 

Balance at end of year 10,263,600 7,681,825 9,900,254 7,681,825 

The ultimate recoupment of costs carried forward is dependant upon the successful development and/or commercial 

exploitation or alternatively, sale of respective areas of interest. 

NOTE 10. ACCOUNTS PAYABLE 

(CURRENT) 

Trade creditors and accruals 172,323 14,614 172,323 14,614 

NOTE 11. PROVISIONS (CURRENT) 

Employee entitlements 77,769 64,469 77,769 64,469 


5.0 Continued 


NOTE 12. SHARE CAPITAL 


Parent Entity 


$ $ $ $ 

Issued Capital 

90,958,872 (1999 : 69,600,000) ordinary Shares 21,676,342 15,830,001 21,676,342 15,830,001 

Less: Capital Raising Expenses (306,841) - (306,841) - 

21,369,501 15,830,001 21,369,501 15,830,001 

Movements in issued and paid up capital of the parent entity during the year are as follows: 

2000 

Number $ 

Balance at beginning of year 69,600,000 15,830,001 

Issued during the year 10,440,000 3,132,000 

Issued during the year 768,872 176,841 

Issued during the year 10,150,000 2,537,500 

Balance at end of year 90,958,872 21,676,342 

On 17 September 1999 the Company entered into a Strategic Alliance Agreement with Centaur Mining & Exploration Limited. 

The Alliance supports the planned Stage II expansion of the Cawse Nickel Project to a production level of more than 40,000 

tonnes per annum of LME grade nickel. Pursuant to the Agreement the Company received $3,132,000 and granted Centaur 

Mining & Exploration Limited an option, at no additional cost, to call for the issue of 10,440,000 Shares in the Company. On 

28 September 1999 Centaur Mining & Exploration Limited called for the issue of the 10,440,000 Shares, which Shares have 

since been issued. 

768,872 Shares were issued to a nominee of Carmichael First Capital Pty Ltd pursuant to the terms of a capital raising 

mandate as a negotiated success fee, which was crystallised with the Heron-Centaur Strategic Alliance. 

Options 

10,000,000 Options expiring on 30 June 2000 exercisable at 25 cents were exercised during June 2000. Shares were 

allotted and issued to Optionholders on 13 July 2000. 

150,000 Options expiring on 15 December 2001 exercisable at 25 cents were exercised during June 2000. Shares were 

allotted and issued to the Optionholder on 13 July 2000. 

As at 30 June 2000 there were a total of 1,690,000 Options on issue as follows: 


125,000 28 August 2001 25 cents 

150,000 01 September 2001 25 cents 


65,000 05 March 2002 25 cents 







page 53

5.0 Continued 


NOTE 13. STATEMENT OF CASH FLOWS 

a) Reconciliation of operating loss after income tax to 

the net cash flows from operations 


Parent Entity 


$ $ $ $ 

Operating loss after income tax (535,636) (5,680,473) (535,636) (5,680,473) 

Add/(less) 

Exploration and evaluation costs written off 29,354 5,140,990 29,354 5,140,990 

Exploration and evaluation costs of mining tenements - 145,063 - 145,063 

disposed of 

Depreciation 50,858 48,761 50,858 48,761 

(Increase)/decrease in accrued interest 4,289 2,057 4,289 2,057 

Increase/(decrease) in creditors and accruals 7,443 (36,272) 7,443 (36,272) 

(443,692) (379,874) (443,692) (379,874) 

b) Non-Cash Financing and Investing Activities 

Issue of 768,872 Shares to a nominee of Carmichael 

First Capital Pty Ltd pursuant to a negotiated 

Success Fee, crystallised with the signing of the 

Strategic Alliance (Note 12). 176,841 - 176,841 - 

Issue of Shares to purchase interests in mining 

tenements. - 30,000 - 30,000 

c) Reconciliation of Cash 

Cash on hand and at bank 2,431,839 1,286,067 2,431,829 1,286,067 

Commercial Bills 1,493,457 - 1,493,457 - 

Closing cash balance 3,925,296 1,286,067 3,925,286 1,286,067 

NOTE 14. REMUNERATION OF DIRECTORS 

Income paid or payable, or otherwise made available 

to Directors by the economic entity and related parties 

in connection with the management of affairs of 

the economic entity: 291,388 184,752 291,388 184,752 

The numbers of the economic entity’s Directors 

whose income (including superannuation contributions) 

was within the specified bands are as follows: 

2000 1999 

Number Number 

$0 - $9,999 1 - 

$20,000 - $29,999 2 1 

$40,000 - $49,999 1 1 

$110,000 - $119,999 - 1 

$210,000 - $219,999 1 - 


5.0 Continued 



$ $ 

NOTE 15. REMUNERATION OF EXECUTIVES 

Income paid or payable, or otherwise made available 

to Executives by the economic entity and related parties 

in connection with the management of affairs 

of the economic entity: 150,000 150,000 


Number Number 

The numbers of the economic entity Executives whose income 

(including superannuation contributions) was within 

the specified bands are as follows: 

$150,000 - $159,999 1 1 

The economic entity employs a single Senior Executive, being the Exploration Manager. 

The terms Director and Executive Officer have been treated as mutually exclusive for the purposes of this disclosure. 

In the opinion of the Directors, remuneration paid to Directors and Executives is considered fair and reasonable. 

NOTE 16. RELATED PARTY DISCLOSURES 

a) The Directors of the parent entity during the financial year were: 

Rodney Michael Evans 

Ian James Buchhorn 

Robert George Colville 

Kenneth John Hellsten (appointed 17 September 1999, resigned 26 May 2000) 

Peter James Lee (appointed 26 May 2000) 

b) Related party transactions during the financial year were: 

• Payment of $61,256 (1999 : $75,622) to parties related to Mr I J Buchhorn for the provision of office accommodation 

and secretarial services on normal commercial terms and conditions; 

• Payment of $1,068 (1999 : $3,680) for residential accommodation secured by the economic entity for an employee 

from a party related to Mr I J Buchhorn on normal commercial terms and conditions; 

• Payments of $75,000 (1999 : nil) for acquisition of mining tenements from parties related to Mr I J Buchhorn on normal 

terms and conditions; 

• Information on remuneration of Directors and Executives of the economic entity is disclosed in Notes 14 and 15; and 

• Interest-free loan of $363,346 (1999 : nil) was made by the parent entity to the controlled entity Balladonia Energy NL. 

c) Transactions of Directors and Director related entities concerning Shares or Options were: 

• Aggregate number of Shares and Options of the parent entity held directly, indirectly or beneficially by Directors or 

Director-related entities at balance date: 


Ordinary Shares held 31,609,855 22,109,856 

Options over Ordinary Shares held 1,350,000 9,500,000 

• During the year, Directors and Director related entities acquired 9,499,999 Shares of the Company of which 9,150,000 

were acquired by exercise of Options and the balance of Shares were acquired on the same basis as similar transactions 

with other Shareholders; 


page 55

5.0 Continued 


• 1,000,000 Options were issued to I J Buchhorn during the year as approved by Shareholders at the 1999 Annual 

General Meeting on the following terms: 







The value of Options is calculated to be $60,000. This amount has been included in the remuneration of Directors 

(Note 14). 

d) No other benefits have been received or are receivable by Directors or Director related entities, other than those already 

disclosed in the notes to the accounts. 

e) Heron Resources NL is the ultimate parent entity. Ownership interest in the controlled entity is as set out in Note 22. 

NOTE 17. FINANCIAL INSTRUMENTS 

a) Terms, conditions and accounting policies 

The economic entity’s accounting policies, including the terms and conditions of each class of financial asset, financial 

liability and equity instrument, both recognised and unrecognised at the balance date, are as follows: 

Recognised Financial Balance Accounting Policies Terms and Conditions 

Instruments 

Sheet Notes 

i) Financial assets 

11am Call Accounts 11am Call Accounts are carried at cost. The 11am Call Accounts are at call 

with an interest rate of 5.75% 

(1999 : 4.5%). 

Commercial Bills Commercial Bills are carried at an Commercial Bills have a term 

amount representing cost and a portion of 26 days with an interest 

of the discount recognised as 

rate of 6.15% (1999 : nil). 

income on an effective yield basis. 

Environmental Bonds 

ii) Financial liabilities 

Environmental Bonds are carried at cost. Environmental Bonds are security 

term deposits with a 6 month term 

with an interest rate of 5.5% 

(1999 : nil). 

Trade creditors 10 Liabilities are recognised for amounts Trade liabilities are normally settled 

and accruals to be paid in the future for goods and on 30 day terms. 

services received, whether or not billed 

to the economic entity. 

iii) Equity 

Ordinary Shares 12 Ordinary Share capital is recognised at Details of the Shares issued and the 

the fair value of the consideration terms and conditions of the Options 

received by the economic entity. outstanding over ordinary Shares at 

balance date are set out in Note 12. 


5.0 Continued 


b) Interest rate risk 

The economic entity’s exposure to interest rate risks and the effective interest rates of financial assets and financial liabilities, 

both recognised and unrecognised at the balance date are as follows: 

Financial Instruments Floating Fixed interest Total carrying Weighted average 

interest rate rate maturing in amount as per effective 

1 year or less balance sheet interest rate 

2000 1999 2000 1999 2000 1999 2000 1999 

$ $ $ $ $ $ % % 

i) Financial assets 

Cash at bank 1,866,425 209,376 - - 1,866,425 209,376 4.85 2.50 

Commercial Bills - - 1,493,457 - 1,493,457 - 6.15 - 

11am Call Accounts 539,454 1,076,691 - - 539,454 1,076,691 5.75 4.50 

Environmental Bonds - - 25,960 - 25,960 - 5.50 - 

Total financial assets 2,405,879 1,286,067 1,519,417 - 3,925,296 1,286,067 n/a n/a 

ii) Financial liabilities 

Non-Interest Total carrying Weighted average 

Bearing amount as per effective 

balance sheet interest rate 

2000 1999 2000 1999 2000 1999 

$ $ $ $ % % 

Trade creditors and accruals 172,323 14,614 172,323 14,614 n/a n/a 

Total financial liabilities 172,323 14,614 172,323 14,614 n/a n/a 

c) Net fair values 

Total carrying amount as per Aggregate net fair value i) 

balance sheet 


$ $ $ $ 

Financial assets 

Cash at bank 1,866,425 209,376 1,866,425 209,376 

Commercial Bills 1,493,457 - 1,493,457 - 

11am Call accounts 539,454 1,076,691 539,454 1,076,691 

Environmental Bonds 25,960 25,960 

Total financial assets 3,925,296 1,268,067 3,925,296 1,268,067 

Financial liabilities 

Trade creditors and accruals 172,323 14,614 172,323 14,614 

Total financial liabilities 172,323 14,614 172,323 14,614 

i) The following methods and assumptions are used to determine the net fair values of financial assets and liabilities. 

Recognised financial instruments: 

Cash, cash equivalents and short-term investments: 

Receivables and trade creditors: 

The carrying amount approximates fair value because 

of their short-term maturity. 

The carrying amount approximates fair value. 


page 57

5.0 Continued 


NOTE 18. AUDITORS’ REMUNERATION 


Parent Entity 


$ $ $ $ 

Amounts received or due and receivable by the auditors for: 

- audit services 11,345 12,500 11,345 12,500 

- other services - 7,785 - 7,785 

NOTE 19. COMMITMENTS FOR EXPENDITURE 

Exploration Commitments 

In order to maintain current rights of tenure to exploration and mining tenements, the economic entity has the following 

discretionary exploration expenditure requirements up until expiry of leases. These obligations, which are subject to 

renegotiation upon expiry of the leases, are not provided for in the financial statements and are payable: 


Parent Entity 


$ $ $ $ 

Not later than 1 year 2,000,000 2,000,000 1,800,000 2,000,000 

Later than 1 year but not later than 2 years 2,000,000 2,000,000 1,800,000 2,000,000 

Later than 2 years but not later than 5 years 6,000,000 6,000,000 5,000,000 6,000,000 

If the economic entity decides to relinquish certain leases and/or does not meet these obligations, assets recognised in the 

balance sheet may require review to determine the appropriateness of carrying values. The sale or farm-out of exploration 

rights to third parties will reduce or extinguish these obligations. Those amounts detailed above do not include expenditure 

commitments which are the responsibility of joint venture partners (Note 21). 

NOTE 20. SEGMENT INFORMATION 

The economic entity operates in the mineral exploration industry in Australia. 

NOTE 21. JOINT VENTURE AGREEMENTS 

The economic entity has entered into or is negotiating the following joint venture agreements: 

Project Operator Right to Farm-in 

Earn Expenditure 

Menzies East Golden State Resources Limited 60% $250,000 

Laverton Metex Resources NL 70% $500,000 

Mt Morgans Metex Resources NL 70% $200,000 

Snake Hill Connemara Gold Mines Pty Ltd 70% $300,000 

Mungari Northwest Kundana Gold Pty Ltd 50% $3,000,000 

Southern Laverton Tectonic Zone Gutnick Resources NL 80% $1,200,000 

Edjudina and Laverton Croesus Mining NL 80% $1,000,000 

Bungalbin and Mount Jackson Portman Limited 100%* $250,000 

Karonie South WMC Resources Limited 80% $300,000 

Scotia Kanowna Delta Gold Ltd 70% $1,000,000 

Transline New Hampton Goldfields Limited 80% $800,000 

Binduli East AngloGold Australasia Limited 75% $500,000 

Widgiemooltha + WMC Resources Limited 80% $300,000 

Kookynie + Barminco Pty Ltd & Kookynie Resources NL 70% $750,000 

Kurnalpi In negotiation 80% $200,000 

Victory In negotiation 80% $100,000 

Frances Lesley In negotiation 100%** - 

Mineral Hill In negotiation 0%*** - 

TOTAL $10,650,000 

* The Company has a royalty based on tonnes of iron ore sold by Portman Limited. 

** The Company retains all nickel rights. Another entity acquires all gold rights and maintains tenements in good standing. 

*** The Company acquires all nickel rights and maintains the tenements in good standing. Another entity retains all gold rights. 

+ Subject to final documentation. 


5.0 Continued 


NOTE 22. INVESTMENTS IN CONTROLLED ENTITIES 

Name of Country of Class of Equity Holding Cost of Parent Entity’s 

Entity Incorporation Shares Investment 


$ $ 

Balladonia Energy NL Australia Ordinary 100% - 10 - 

Balladonia Energy NL was incorporated to evaluate the economic potential of documented oil shale occurrences in the Balladonia area 

to contribute to the generation of the energy, sulphur and lime requirements of Heron’s Nickel Laterite projects. The corporate objective 

has been to introduce a technical partner with demonstrated oil shale expertise, to further advance the oil shale projects. 

NOTE 23. CONTINGENT LIABILITIES 

Native title claims have been made with respect to areas which include tenements in which the economic entity has interests. 

The economic entity is unable to determine the prospects for success or otherwise of the claims and, in any event, whether or 

not and to what extent the claims may significantly affect the economic entity or its projects. 

NOTE 24. EARNINGS PER SHARE 


$ $ 

Basic earnings per Share (0.0068) (0.0891) 

Weighted average number of ordinary Shares outstanding 

during the year used in the calculation of basic earnings per Share. 77,925,300 63,757,808 

As diluted earnings per Share is not materially different from basic 

earnings per Share it has not been disclosed. 

NOTE 25. SUBSEQUENT EVENTS 

Option Exercise 

10,000,000 Options expiring on 30 June 2000 exercisable at 25 cents were exercised during June 2000. Shares were allotted 

and issued to Optionholders on 13 July 2000. 

150,000 Options expiring on 15 December 2001 exercisable at 25 cents were exercised during June 2000. Shares were 

allotted and issued to the Optionholder on 13 July 2000. 

Tenement Plaints 

Plaints for forfeiture have been lodged on six tenements. The Directors believe that the plaint action will not succeed. 


page 59

5.0 Continued 

Directors’ Declaration 

5.0 Directors’ Declaration 

In accordance with a resolution of the Directors of Heron Resources NL it is declared that: 

a) The financial statements and notes comply with Accounting Standards, the Corporations Regulations and other 

mandatory professional reporting requirements; and 

b) Give a true and fair view of the Company’s and consolidated entity’s financial position as at 30 June 2000 and of their 

performance, as represented by the results of their operations and their cash flows, for the financial year ended on that 

date. 

In the Directors’ opinion: 

a) The financial statements and notes are in accordance with the Corporations Law; and 

b) At the date of this declaration there are reasonable grounds to believe that the Company will be able to pay its debts 

when they become due and payable. 

On behalf of the Board 

R G COLVILLE 

Director 




Independent Audit Report 

6.0 Independent Audit Report 

To the members of Heron Resources NL 

Scope 

We have audited the financial report of Heron Resources NL for the year ended 30 June 2000 as set out on pages 45 to 60. 

The Company’s Directors are responsible for the financial report which includes the financial statements of the Company and the 

consolidated financial statements of the consolidated entity comprising the Company and the entities it controlled at the end of, 

or during, the financial year. We have conducted an independent audit of the financial report in order to express an opinion on 

it to the members of the Company. 

Our audit has been conducted in accordance with Australian Auditing Standards to provide reasonable assurance whether the 

financial report is free of material misstatement. Our procedures included examination, on a test basis, of evidence supporting 

the amounts and other disclosures in the financial report and the evaluation of accounting policies and significant accounting 

estimates. These procedures have been undertaken to form an opinion as to whether, in all material respects, the financial report 

is presented fairly in accordance with Accounting Standards, other mandatory professional reporting requirements and statutory 

requirements, so as to present a view which is consistent with our understanding of the Company’s and the consolidated entity’s 

financial position and performance as represented by the results of their operations and their cash flows. 

The audit opinion expressed in this report has been formed on the above basis. 

Audit Opinion 

In our opinion, the financial report of Heron Resources NL is in accordance with: 

a) The Corporations Law including: 

i) Giving a true and fair view of the Company’s and consolidated entity’s financial position as at 30 June 2000 and of their 

performance for the year ended on that date; and 

ii) Complying with Accounting Standards and the Corporations Regulations; and 

b) Other mandatory professional reporting requirements. 

BUTLER SETTINERI 

Chartered Accountants 

COLIN BUTLER 

Partner 



page 61


Shareholder Information 

7.0 Shareholder Information 

SHAREHOLDER INFORMATION AT 13 SEPTEMBER 2000 

1. Issued Shares and Options 

a) Distribution of Shareholders: 

Size of Holding Number of Holders Shares Held 

1 - 1,000 46 33,851 

1,001 - 5,000 512 1,670,350 

5,001 - 10,000 467 3,992,663 

10,001 - 100,000 651 18,775,360 

100,001 - 63 66,486,648 

1739 90,958,872 

b) The twenty largest Shareholders hold 63.45% of the issued fully paid capital of the Company. 

c) Substantial Shareholder who has notified the Company: 

Holder Number of Shares % 

Hazurn Pty Ltd 26,250,000 28.86 

Centaur Nickel Investments Pty Ltd 15,890,310 17.47 

d) Distribution of Optionholders: 

The following Options were on issue: 

i) 100,000 exercisable on or before 28 August 2001 payment of 25 cents per Option exercised; 

ii) 150,000 exercisable on or before 01 September 2001 payment of 25 cents per Option exercised; 

iii) 350,000 exercisable on or before 15 December 2001 payment of 25 cents per Option exercised; 

iv) 50,000 exercisable on or before 05 March 2002 payment of 25 cents per Option exercised; 

v) 200,000 exercisable on or before 19 December 2002 payment of 25 cents per Option exercised; 

vi) 200,000 exercisable on or before 19 December 2002 payment of 35 cents per Option exercised; 

vii) 200,000 exercisable on or before 19 December 2002 payment of 45 cents per Option exercised; 

viii) 200,000 exercisable on or before 19 December 2002 payment of 55 cents per Option exercised; 

ix) 200,000 exercisable on or before 19 December 2002 payment of 65 cents per Option exercised; 

Size of Holding Number of Holders Options Held 

1 - 1,000 0 0 

1,001 - 5,000 0 0 

5,001 - 10,000 0 0 

10,001 - 100,000 1 50,000 

100,001 - 5 1,600,000 

6 1,650,000 

e) There were 54 Shareholders who held less than a marketable parcel. 

f) Nil securities have been classified by ASX as restricted. 




VOTING RIGHTS 

In accordance with Regulation 18.1 of the Company’s Articles, voting rights are on the basis of a show of hands, one vote for 

every registered holder and on a poll, one vote for each Share held by registered holders. 

Twenty Largest Shareholders as at 13 September 2000 

Number of Shares % 

1. Hazurn Pty Ltd 26,250,000 28.86 

2. Centaur Nickel Investments Pty Ltd 15,890,310 17.47 

3. Koltai Holdings Pty Ltd 2,675,679 2.94 

4. Buchhorn Ian James 2,447,857 2.69 

5. Buchhorn Pamela Jean 1,519,998 1.67 

6. Barminco Pty Ltd 1,000,000 1.10 

7. GHK Mining Pty Ltd 990,000 1.09 

8. Bronwen Pty Ltd 800,000 0.88 

9. Overnight Nominees Pty Ltd 586,985 0.65 

10. Jindabyne Pty Ltd 585,000 0.64 

11. P K Trading (WA) Pty Ltd 582,198 0.64 

12. Dolerite Investments Pty 580,000 0.64 

13. Hawke Robert Lawrence 506,666 0.56 

14. Kett Peter John 504,998 0.56 

15. Goldenstate Holdings Pty Ltd 500,000 0.55 

16. Blue Sky Pty Ltd 500,000 0.55 

17. Erlup Nominee Pty Ltd 480,893 0.53 

18. Everest William and Roseanne 450,000 0.49 

19. Ufar Pty Ltd 430,000 0.47 

20. Moate Investments Inc 428,900 0.47 

TOTAL 57,709,484 63.45% 

Optionholders as at 13 September 2000 

Optionholders (Options exercisable on or before 28 August 2001) were: 

Number of Options 

% of Issued Options 

Crook Jennifer Anne 100,000 100.00 

Optionholders (Options exercisable on or before 01 September 2001) were: 



Red Oaks Pty Ltd 150,000 100.00 

Optionholders (Options exercisable on or before 15 December 2001) were: 



Whitebeach Pty Ltd 200,000 57.14 

Colville Marilyn 150,000 42.86 

TOTAL 350,000 100.00 


7.0 Continued 


Optionholders (Options exercisable on or before 05 March 2002) were: 



Rudd Mara 50,000 100.00 

Optionholders (Options exercisable on or before 19 December 2002) were: 



Buchhorn Ian James 1,000,000 100.00 

Summary of Optionholders as at 13 September 2000 

Number of Options % of Issued Options 

1. Buchhorn Ian James 1,000,000 60.61 

2. Whitebeach Pty Ltd 200,000 12.12 

3. Red Oaks Pty Ltd 150,000 9.09 

4. Colville Marilyn 150,000 9.09 

5. Crook Jennifer Anne 100,000 6.06 

6. Rudd Mara 50,000 3.03 

1,650,000 100.00 


8.0 Continued 

Interest in Mining Tenements 

8.0 Interest in Mining Tenements 

Prospect Geographic Tenement Area Status Interest 

Location Identifier km 2 Held 

CENTAUR MINING & EXPLORATION STRATEGIC ALLIANCE Goongarrie Nickel Project: Ni(-Au) 

Goongarrie South 75km NNW of Kalgoorlie E29/00148 30.80 G 100% 1 

M29/00272 A 100% 1 

M29/00278 A 100% 1 

Siberia 70km NW of Kalgoorlie E29/00356 4.78 G 100% 1 

Menzies South 109km NNW of Kalgoorlie E29/00433 11.20 A 100% 1 

Goongarrie 88km NNW of Kalgoorlie E29/00437 19.60 A 100% 1 

Comet Vale 90km NNW of Kalgoorlie E29/00462 89.60 A 100% 1 

Goongarrie Hill 87km NNW of Kalgoorlie M29/00167 1.09 G 100% 1 

Scotia Dam 65km NNW of Kalgoorlie P24/02749 1.28 G 100% 1 





M24/00542 A 100% 1 




M24/00541 A 100% 1 

Scotia North 75km NW of Kalgoorlie P24/03273 0.06 G 100% 1 

M24/00744 A 100% 1 

Scotia 68km NNW of Kalgoorlie P24/03479 0.28 G 100% 1 

M24/00798 A 100% 1 

Goongarrie West 88km NNW of Kalgoorlie P29/01338 2.00 G 100% 1 



M29/00202 A 100% 1 



Scotia North 74km NNW of Kalgoorlie P29/01636 1.16 G 100% 1 

Scotia North 74km NNW of Kalgoorlie P29/01637 1.16 G 100% 1 

Goongarrie 89km NNW of Kalgoorlie P29/01671 0.39 A 100% 1 

24 181.74 

1 

Heron has the right to process ore through the proposed Centaur Mining & Exploration Ltd Cawse Stage II plant, subject to a 

favourable BFS. 

CENTAUR MINING & EXPLORATION STRATEGIC ALLIANCE Ghost Rocks Nickel Project: Ni(-Au) 

Ghost Rocks 146km NNW of Kalgoorlie E29/00147 84.00 G 100% 1 

Ghost Rocks 146km NNW of Kalgoorlie E29/00464 61.60 A 100% 1 

Ghost Rocks 145km NNW of Kalgoorlie E29/00465 61.60 A 100% 1 

3 207.20 

1 

Heron has the right to process ore through the proposed Centaur Mining & Exploration Ltd Cawse Stage II plant, subject to a 

favourable BFS. 


page 65

8.0 Continued 




CENTAUR MINING & EXPLORATION STRATEGIC ALLIANCE Kalpini Nickel Project: Ni(-Au) 

Acra North 65km NE of Kalgoorlie E27/00076 1.14 G 100% 1 

M27/00349 A 100% 1 

Wellington East 65km NE of Kalgoorlie E27/00129 33.60 G 100% 1 

M27/00364 A 100% 1 

M27/00365 A 100% 1 

North Burton 58km NE of Kalgoorlie E27/00210 5.60 A 100% 1 

Kalpini Hill South 60km NE of Kalgoorlie E27/00211 2.80 A 100% 1 

Wellington 65km NE of Kalgoorlie E27/00223 162.40 A 100% 1 

Acra North 65km NE of Kalgoorlie E28/00426 36.99 G 100% 1 

M28/00199 A 100% 1 

M28/00200 A 100% 1 

M28/00201 A 100% 1 

M28/00202 A 100% 1 

Betsy Bore 65km NE of Kalgoorlie E28/00459 20.68 G 100% 1 

M28/00169 A 100% 1 

M28/00205 A 100% 1 

M28/00206 A 100% 1 

M28/00215 A 100% 1 

Grey Dam 70km NE of Kalgoorlie E28/00991 11.20 A 100% 1 

Kurnalpi Hill 87km NE of Kalgoorlie E28/01012 61.60 A 100% 1 

Betsy Bore 79km NE of Kalgoorlie E28/01100 173.60 A 100% 1 

Acra Chrysoprase 65km NE of Kalgoorlie M28/00127 0.32 A 100% 1 

Wellington North 70km NE of Kalgoorlie P27/01448 1.60 G 100% 1 



M27/00361 A 100% 1 



M27/00362 A 100% 1 


17 519.52 

1 

Heron has the right to process ore through the proposed Centaur Mining & Exploration Ltd Cawse Stage II plant, subject 

to a favourable BFS. 


8.0 Continued 




SCOTIA KANOWNA PROVINCE Scotia Kanowna Project: Ni(-Au) 

Scotia 65km NW of Kalgoorlie E24/00113 5.60 A 100% 

Twin Hills 150km N of Kalgoorlie E29/00490 42.00 A 100% 

Vettersberg 60km NNW of Kalgoorlie M24/00453 1.84 A 100% 

Scotia 62km NNE of Kalgoorlie M24/00843 4.71 A 100% 

Silver Swan North 47km NNE of Kalgoorlie M27/00388 5.54 A 100% 

Vettersberg 59km NNW of Kalgoorlie P24/03695 1.95 A 100% 

Ghost Rocks 134km NNW of Kalgoorlie P29/01682 0.75 A 100% 

7 62.39 

SCOTIA KANOWNA PROVINCE Kurnalpi Nickel Project: NI(-Au) 

Kalpini 60km NE of Kalgoorlie M27/00350 4.28 A 100% 

Binti Binti South 80km NE of Kalgoorlie E27/00251 39.20 A 100% 

Kurnalpi East 100km NE of Kalgoorlie E28/00886 53.20 G 100% 

Kurnalpi Hill 88km NE of Kalgoorlie E28/01108 92.40 A 100% 

Binti Binti 82km NE of Kalgoorlie E31/00261 14.00 G 100% 

M31/00297 A 100% 

5 203.08 

SCOTIA KANOWNA PROVINCE Menzies East JV Project: Au(-Ni) 

Menzies East 112km NNW of Kalgoorlie P29/01381 1.29 G 100% 2 

M29/00231 A 100% 2 


M29/00230 A 100% 2 







M29/00274 A 100% 2 

8 8.38 

2 

Golden State Resources Ltd right to earn 60%. 

SCOTIA KANOWNA PROVINCE Gindalbie Terrain JV Project: Au-Ni 

Mulgarrie North 47km N of Kalgoorlie E24/00097 28.00 G 100% 3 

Gindalbie 50km NNE of Kalgoorlie E27/00145 47.60 G 100% 3 

Scotia East 60km N of Kalgoorlie E27/00169 108.40 G 100% 3 

Scotia East 55km NNW of Kalgoorlie M24/00799 9.53 A 100% 3 

Scotia East 55km NNW of Kalgoorlie M24/00800 6.41 A 100% 3 

Kanowna East 23km NE of Kalgoorlie M27/00272 2.01 A 100% 3 

6 201.95 

3 

Delta Gold Ltd right to earn 70% of gold rights. 

SCOTIA KANOWNA PROVINCE Yindarlgooda Project: Ni(-Au) 

Clinker Hill 32km SE of Kalgoorlie E25/00250 58.80 A 100% 

1 58.80 


page 67

8.0 Continued 




EMU FAULT PROVINCE Kurnalpi Gold Joint Venture Project: Au 

Tap Rock Hill 90km E of Kalgoorlie E28/00927 190.40 A 100% 4 

Hampton 70km E of Kalgoorlie E28/01117 33.60 A 100% 4 

Hampton 73km E of Kalgoorlie E28/01118 5.60 A 100% 4 

Acra South 67km E of Kalgoorlie E28/01146 30.80 A 100% 4 

4 260.40 

4 

Farm-inee right to earn 80%. 

EMU FAULT PROVINCE Kurnalpi Gold Project: Au 

Transline 72km E of Kalgoorlie E25/00234 53.20 A 100% 

Pipeclay Peaks 62km E of Kalgoorlie E25/00241 11.20 A 100% 

Lake Sloan 98km SSE of Kalgoorlie E25/00248 196.00 A 100% 

Yindi Dam 100km E of Kalgoorlie E28/00995 67.20 A 100% 

Gundockerta Hill 70km E of Kalgoorlie E28/01116 140.00 A 100% 

Sawmill Dam 77km E of Kalgoorlie E28/01129 19.60 A 100% 



Round Hill 107km SE of Kalgoorlie E28/01148 196.00 A 100% 

9 730.80 

EMU FAULT PROVINCE Kalpini Gold Project: Au 

Yindarlgooda 52km NE of Kalgoorlie E25/00222 58.80 A 100% 

Mt McLeay 51km NE of Kalgoorlie E27/00243 16.80 A 100% 

Lindsays Find 55km NNE of Kalgoorlie M27/00305 1.20 A 100% 

Kalpini West 48km NE of Kalgoorlie M27/00371 3.37 A 100% 

Kalpini West 52km NE of Kalgoorlie M27/00372 1.64 A 100% 

Lindsays North 55km NNE of Kalgoorlie M27/00382 1.15 A 100% 

Gindalbie 45km NE of Kalgoorlie M27/00383 3.57 A 100% 

Garibaldi 48km NE of Kalgoorlie M27/00386 0.29 A 100% 

Lindsays Find 55km NNE of Kalgoorlie P27/01474 0.08 G 100% 

Garibaldi 48km NE of Kalgoorlie P27/01491 1.34 G 100% 

10 88.23 

EMU FAULT PROVINCE Transline Joint Venture Project: Au-Ni 

Gundockerta Hill 60km ESE of Kalgoorlie E25/00114 16.80 G 100% 5 

M25/00267 A 100% 5 



Trans Find North 60km ESE of Kalgoorlie E25/00179 89.60 G 100% 5 

Trans Find 60km ESE of Kalgoorlie E25/00184 53.20 G 100% 5 

Gundockerta Hill West 60km ESE of Kalgoorlie E25/00186 8.40 G 100% 5 

Seabrook Hills 60km ESE of Kalgoorlie E25/00189 2.80 G 100% 5 

Seabrook Hills 60km ESE of Kalgoorlie E25/00191 14.00 A 100% 5 

Trans Find 60km ESE of Kalgoorlie E25/00195 44.80 G 100% 5 

Hawke Hill 60km ESE of Kalgoorlie E25/00204 8.40 G 100% 5 

Pipeclay Peaks 62km E of Kalgoorlie E25/00216 120.40 A 100% 5 

Kim’s Dam 86km E of Kalgoorlie E28/01003 56.00 A 100% 5 

Randalls 60km ESE of Kalgoorlie P25/01580 1.00 A 100% 5 

13 421.00 

5 

New Hampton Goldfields Limited right to earn 80%. 


8.0 Continued 




KEITH KILKENNY PROVINCE Kookynie Joint Venture Project: Au-Ni 

Glenorn Station South 45km SE of Leonora E31/00410 67.20 G 100% 6 

Friday Well 58km SE of Leonora E31/00484 16.80 G 100% 6 

Boomerang Lake 110km SSE of Leonora E31/00519 156.80 A 100% 6 

Desdemona North 20km S of Leonora E40/00122 2.80 A 100% 6 

Morapoi 55km S of Leonora E40/00132 5.97 A 100% 6 

Tampa 40km SSE of Leonora E40/00140 8.98 A 100% 6 

Tampa 40km SSE of Leonora E40/00141 2.99 A 100% 6 

Tampa 40km SSE of Leonora E40/00142 14.00 G 100% 6 

8 275.54 

6 

Barminco Pty Ltd and Kookynie Resources NL right to earn 70% of gold rights. 

KEITH KILKENNY PROVINCE Kookynie Project: Au 

Mount Melita East 36km SE of Leonora E40/00127 2.80 G 100% 

Malcolm East 25km SE of Leonora M37/00727 4.43 A 100% 




Alice Gold Mine 17km ESE of Leonora M37/00953 0.10 A 100% 

Eulaminna 50km SE of Leonora M39/00428 6.13 A 100% 

7 36.93 

KEITH KILKENNY PROVINCE Edjudina Nickel Project: Ni(-Au) 

Mt Catherine South 145km NNE of Kalgoorlie E31/00279 28.00 G 100% 

Boyce Creek East 150km NNE of Kalgoorlie E31/00304 11.20 G 100% 

M31/00296 A 100% 

Mt Remarkable East 155km NNE of Kalgoorlie E31/00346 2.80 B 100% 

Claypan Dam 155km NNE of Kalgoorlie E31/00347 2.80 B 100% 

Yerilla Creek Dam 155km NNE of Kalgoorlie E31/00348 11.20 B 100% 

Mt Catherine East 145km NNE of Kalgoorlie E31/00372 5.60 B 100% 

Mt Catherine East 145km NNE of Kalgoorlie E31/00373 2.80 B 100% 

Yerilla 150km NNE of Kalgoorlie E31/00399 2.80 A 100% 

McAuliffe Well 155km NNE of Kalgoorlie E31/00518 50.40 A 100% 

Mt Catherine 145km NNE of Kalgoorlie E31/00529 2.80 A 100% 

Aubils Bore 175km NNE of Kalgoorlie E39/00345 33.60 G 100% 

Larkin Well 170km NNE of Kalgoorlie E39/00641 5.60 A 100% 

Kilmore Hill 175km NNE of Kalgoorlie E39/00648 26.93 G 100% 

Mount Percy 175km NNE of Kalgoorlie E39/00680 2.98 A 100% 





Lake Raeside 175km NNE of Kalgoorlie E39/00700 32.88 A 100% 

Lake Raeside 175km NNE of Kalgoorlie E39/00725 16.80 A 100% 


Yerilla 150km NNE of Kalgoorlie M31/00105 2.40 G 100% 

Yerilla 150km NNE of Kalgoorlie M31/00110 7.20 G 100% 

Yerilla 150km NNE of Kalgoorlie M31/00278 0.70 A 100% 

Aubils Bore 175km NNE of Kalgoorlie M39/00656 1.48 A 100% 






Yerilla 150km NNE of Kalgoorlie P31/01538 1.11 G 100% 

31 338.00 


page 69

8.0 Continued 




KEITH KILKENNY PROVINCE Laverton Tectonic Zone JV: Au 

Yarri South 135km NE of Kalgoorlie E31/00235 5.60 G 100% 7 

Yilgangi East 140km NE of Kalgoorlie E31/00236 1.60 G 100% 7 

Yarri East 155km NE of Kalgoorlie E31/00312 68.41 A 100% 7 

Seddon Bore 155km NE of Kalgoorlie E31/00354 16.80 A 100% 7 

Webb Find West 145km NNE of Kalgoorlie E31/00374 14.00 G 100% 7 

Boyce Creek South 150km NNE of Kalgoorlie E31/00377 28.00 G 100% 7 

Duck Hill West 165km NNE of Kalgoorlie E31/00430 84.00 G 100% 7 

Lake Rebecca 116km NE of Kalgoorlie E31/00465 2.80 G 100% 7 

Lake Rebecca 115km NE of Kalgoorlie E31/00479 11.20 A 100% 7 

Mount Boyce 150km NNE of Kalgoorlie E31/00524 176.40 A 100% 7 

Camel Hump 55km N of Laverton E38/00945 9.06 G 100% 7 

Mount Varden West 55km N of Laverton E38/01152 117.60 G 100% 7 

Mount Varden West 55km N of Laverton E38/01153 19.60 G 100% 7 

Yabboo Hill East 156km NE of Kalgoorlie E39/00795 8.40 G 100% 7 

Edjudina South 135km NE of Kalgoorlie P31/01548 0.40 G 100% 7 

Yilgangi North 131km NNE of Kalgoorlie P31/01580 1.85 G 100% 7 



18 569.13 

7 

Croesus Mining NL right to earn 80%, Heron retains all nickel rights. 

KEITH KILKENNY PROVINCE South Laverton Tectonic Zone JV: Au 

Pinjin South 140km ENE of Kalgoorlie E28/00891 11.20 G 100% 8 

Patricia West 155km ENE of Kalgoorlie E31/00244 16.80 A 100% 8 

Pinjin 140km ENE of Kalgoorlie E31/00263 2.80 G 100% 8 

Stophanis East 155km ENE of Kalgoorlie E31/00265 2.80 G 100% 8 

Yarri North East 160km NE of Kalgoorlie E31/00313 2.80 G 100% 8 

Yarri North East 160km NE of Kalgoorlie E31/00315 2.80 G 100% 8 

Edjudina East 160km NE of Kalgoorlie E31/00317 38.65 G 100% 8 

Stophanis East 150km ENE of Kalgoorlie E31/00343 2.97 G 100% 8 

Broken Hill Bore 160km NE of Kalgoorlie E31/00352 2.86 A 100% 8 

Clymies Well 160km NE of Kalgoorlie E31/00353 37.46 A 100% 8 

Hobble Gap 160km NE of Kalgoorlie E31/00434 44.80 G 100% 8 

Patricia South 155km ENE of Kalgoorlie E31/00489 16.80 G 100% 8 

Deep Well South 170km NE of Kalgoorlie E39/00661 2.80 G 100% 8 

Deep Well North 170km NE of Kalgoorlie E39/00662 2.98 A 100% 8 

Deep Well 170km NE of Kalgoorlie E39/00663 2.98 A 100% 8 

Gairdiners Find 170km NNE of Kalgoorlie E39/00721 47.60 G 100% 8 

Mount Hornet 170km NNE of Kalgoorlie E39/00729 33.60 G 100% 8 

Gardiners Find 170km NNE of Kalgoorlie E39/00734 5.60 A 100% 8 

Crab Hill 135km ENE of Kalgoorlie P28/00923 1.38 G 100% 8 





Stophanis South 150km ENE of Kalgoorlie P31/01546 1.61 G 100% 8 

Stophanis South 150km ENE of Kalgoorlie P31/01547 1.20 A 100% 8 

Edjudina 160km NE of Kalgoorlie P31/01569 1.79 A 100% 8 







Gairdiners Find 170km NNE of Kalgoorlie P39/03691 2.00 G 100% 8 

33 302.76 

8 

Gutnick Resources NL right to earn 80%, Heron retains all nickel rights. 


8.0 Continued 




KEITH KILKENNY PROVINCE Edjudina Gold Project: Au 

Crab Hill 137km E of Kalgoorlie E28/01138 5.60 A 100% 

Outcamp Bore 155km NE of Kalgoorlie E31/00190 11.20 G 100% 

Oak Bore 155km NE of Kalgoorlie E31/00233 2.80 G 100% 

Oak Bore South 155km NE of Kalgoorlie E31/00234 2.80 G 100% 

Wallbrook Hill 125km NE of Kalgoorlie E31/00237 5.60 G 100% 

Yilgangi 155km NE of Kalgoorlie E31/00494 81.20 A 100% 

Gairdner West 170km NNE of Kalgoorlie E39/00642 2.80 A 100% 

Larkin West 170km NNE of Kalgoorlie E39/00643 5.60 A 100% 

Murphy Well 180km NNE of Kalgoorlie E39/00831 33.60 A 100% 

Banjo Well 145km NE of Kalgoorlie M31/00047 4.70 G 100% 

Yarri 145km NE of Kalgoorlie M31/00115 4.21 G 100% 

Yilgangi Castle 140km NE of Kalgoorlie M31/00173 0.34 A 100% 

Mt Catherine 145km NNE of Kalgoorlie M31/00249 0.58 A 100% 

Webb Find 145km NE of Kalgoorlie M31/00281 1.20 A 100% 

Yarri 145km NE of Kalgoorlie P31/01398 0.19 G 100% 

M31/00141 A 100% 

Porphyry North 155km NE of Kalgoorlie P31/01537 0.85 G 100% 

16 163.28 

KEITH KILKENNY PROVINCE Mulgabbie Nickel Project: Ni(-Au) 

Lake Rebecca 110km NE of Kalgoorlie M31/00080 2.02 G 100% 



3 4.37 

KEITH KILKENNY PROVINCE Karonie South JV Project: Au(-Ni) 

Karonie South 140km SE of Kalgoorlie E28/00631 196.00 G 100% 9 



Karonie South 140km SE of Kalgoorlie E28/00860 8.78 A 100% 9 

Karonie South 140km SE of Kalgoorlie E28/00861 58.54 A 100% 9 



Buningonia 156km SE of Kalgoorlie E28/01014 42.00 G 100% 9 

Fraser 168km SE of Kalgoorlie E63/00691 151.20 A 100% 9 

9 666.52 

9 

WMC Resources Limited right to earn 80%. 

KEITH KILKENNY PROVINCE Karonie South Project : Au(-Ni) 

Karonie South 70km E of Norseman E63/00707 196.00 A 100% 




4 691.60 


page 71

8.0 Continued 




MUNGARI PROVINCE Mungari NW JV Project: Au 

Mungari Northwest 35km WNW of Kalgoorlie E15/00411 2.08 A 100% 10 

Mungari Northwest 35km WNW of Kalgoorlie E16/00146 0.34 G 100% 10 

2 2.42 

10 

Kundana Gold Pty Ltd right to earn 50%. 

MUNGARI PROVINCE Mungari Platinum Project: Pt-Au 

Mungari Northwest 35km WNW of Kalgoorlie E16/00121 25.20 G 100% 

Mungari Northwest 35km WNW of Kalgoorlie M16/00377 2.00 A 100% 

Balgarri South 35km WNW of Kalgoorlie M16/00414 2.00 A 100% 

Dryden’s Find 35km WNW of Kalgoorlie P15/04416 0.33 A 100% 







Mungari Northwest 35km WNW of Kalgoorlie P16/01683 1.30 G 100% 


M16/00378 A 100% 





M16/00379 A 100% 

16 50.18 


8.0 Continued 




LEONORA LAVERTON PROVINCE Laverton Nickel Project: Ni-Au 

Mineral Patch Hill 60km SE of Laverton E38/00931 196.00 G 100% 11 

Merolia 40km SE of Laverton E38/01179 196.00 G 100% 11 

Bandya Hill 107km NNW of Laverton E38/01270 36.40 A 100% 

Mulga Queen 124km N of Laverton E38/01329 2.80 A 100% 

Doris Well 60km N of Laverton E38/01368 22.40 A 100% 

Russell 72km N of Laverton E38/01369 11.20 A 100% 

King of Creation 54km N of Laverton E38/01375 2.80 A 100% 

Erlistoun 72km N of Laverton E38/01376 5.60 A 100% 

Mineshaft Well 72km N of Laverton E38/01380 25.20 A 100% 

Perseverance Well 60km NW of Laverton E39/00738 36.40 G 100% 

10 534.80 

11 

Another entity has gold rights. 

LEONORA LAVERTON PROVINCE Laverton JV Project: Au 

Hawkes Nest 15km WSW of Laverton E38/00831 16.80 G 100% 12 

Hawkes Nest South 15km WSW of Laverton E38/00832 14.00 G 100% 12 

2 30.80 

12 

Metex Resources NL right to earn 70%. 

LEONORA LAVERTON PROVINCE Mt Morgans JV Project: Au 

Mt Morgans Northwest 40km WSW of Laverton P39/03454 1.56 G 100% 13 

M39/00754 A 100% 13 




M39/00755 A 100% 13 

Mt Morgans West 40km WSW of Laverton P39/03466 1.71 G 100% 13 




M39/00753 A 100% 13 

8 14.15 

13 

Metex Resources NL right to earn 70%. 

LEONORA LAVERTON PROVINCE Victory Joint Venture Project: Au-Ni 

Doyle Well 60km NW of Leonora E37/00406 16.80 G 100% 14 

M37/01088 A 100% 14 

Victory Gold Mine 55km NW of Leonora M37/00931 0.18 A 100% 14 

Victory 50km NW of Leonora P37/05830 1.95 G 100% 14 




6 23.76 

14 

Farm-inee right to earn 80%. 

LEONORA LAVERTON PROVINCE Victory North Project: Au 

Mount McClure 120km NNW of Leonora E36/00387 16.80 A 100% 

Mount McClure 120km NNW of Leonora E36/00388 5.60 G 100% 

Try Again Bore 123km NNW of Leonora E36/00432 19.60 A 100% 

3 42.00 


page 73

8.0 Continued 




ILLAARA PROVINCE Lawrence Find Project: Cu-Zn-Au-Ni-S 

Ranford Peak 326km NW of Kalgoorlie E29/00434 98.00 G 100% 15 

Mount Marmion 207km NW of Kalgoorlie E29/00435 95.20 G 100% 15 

Metzkes Find 213km NW of Kalgoorlie E29/00455 156.80 A 100% 15 

Lawrence Find 159km NW of Kalgoorlie E30/00203 208.52 A 100% 15 

Lawrence Find North 188km NW of Kalgoorlie E30/00226 196.00 G 100% 15 

Lawrence Find 176km NW of Kalgoorlie E30/00228 64.40 G 100% 15 

Illaara 198km NW of Kalgoorlie E30/00254 126.00 A 100% 15 

7 944.92 

15 

Farm-in proposal to earn 70% of gold rights. 

IDA FAULT PROVINCE Snake Hill JV Project: Au(-Ni) 

Snake Hill North 140km NW of Kalgoorlie E29/00290 8.40 G 100% 16 

Mulline 140km NW of Kalgoorlie E30/00158 39.20 B 100% 

Snake Hill 140km NW of Kalgoorlie E30/00166 8.40 G 100% 16 

3 56.00 

16 

Connemara Gold Mines Pty Ltd right to earn 70%. 

IDA FAULT PROVINCE Frances Lesley Project: Ni 

Frances Lesley 90km NW of Kalgoorlie E16/00174 5.60 A 100% 17 




Frances Lesley 90km NW of Kalgoorlie M16/00385 2.00 A 100% 17 

5 133.60 

17 

Another entity has gold rights. 

IDA FAULT PROVINCE Blister Dam Project: Au-Ni 

Blister Dam 70km NW of Kalgoorlie E24/00088 14.00 G 100% 

Blister Dam 70km NW of Kalgoorlie P24/03577 0.59 G 100% 




M24/00844 A 100% 





M16/00435 A 100% 





M24/00842 A 100% 

13 27.15 


8.0 Continued 




IDA FAULT PROVINCE Bullabulling Project: Ni-Au 

Bullabulling 60km WSW of Kalgoorlie E15/00679 114.80 A 100% 

Bullabulling 60km WSW of Kalgoorlie E16/00172 11.80 A 100% 

Bullabulling-Dunnsville 60km W of Kalgoorlie E16/00181 2.80 A 100% 

Bullabulling-Dunnsville 60km W of Kalgoorlie E16/00182 14.00 A 100% 

Bullabulling-Carbine 60km W of Kalgoorlie E16/00195 44.80 A 100% 

5 188.20 

IDA FAULT PROVINCE Widgiemooltha Joint Venture Project: Ni-Au 

Pioneer 120km SSE of Kalgoorlie E15/00573 47.60 A 100% 18 

Logans Find 76km S of Kalgoorlie E15/00689 100.80 A 100% 18 

Larkinville 76km S of Kalgoorlie P15/04213 1.22 A 100% 18 

Larkinville 76km S of Kalgoorlie P15/04214 1.21 A 100% 18 

4 150.83 

18 

WMC Resources Limited right to earn 80%. 

IDA FAULT PROVINCE Yilmia Hill Project: Ni-Au 

Yilmia Hill 60km S of Kalgoorlie E15/00550 5.86 G 100% 

Spargoville 80km SSW of Kalgoorlie P15/04150 1.98 A 100% 




5 12.49 

IDA FAULT PROVINCE Mount Thirsty Project: Ni(-Au) 

Norseman Highway 9km NW of Norseman P63/01137 1.19 A 100% 







Norseman Highway 8km W of Norseman P63/01144 1.51 A 100% 

Norseman Highway 8km W of Norseman P63/01145 1.77 A 100% 

9 12.74 


page 75

8.0 Continued 




KAMBALDA DOMAIN Binduli East JV Project: Au-Ni 

Mount Hunt 10km SW of Kalgoorlie E26/00081 14.00 A 100% 19 

Binduli East 10km SW of Kalgoorlie P26/02791 1.98 G 100% 19 










Binduli East 10km SW of Kalgoorlie P26/02904 1.84 A 100% 19 

Binduli East 10km SW of Kalgoorlie P26/02905 2.00 A 100% 19 


14 35.78 

19 

AngloGold Australasia Limited has the right to earn 75%. 

KAMBALDA DOMAIN Kurramia Project: Au-Ni 

Gidji Roaster 15km N of Kalgoorlie E24/00111 64.40 A 100% 

Five Mill Hill 7km NE of Kalgoorlie M26/00736 7.04 A 100% 

Kanowna 15km NE of Kalgoorlie M27/00392 7.70 A 100% 



Kurramia 10km N of Kalgoorlie P26/02883 1.17 G 100% 






Kurramia South 10km N of Kalgoorlie P26/02977 0.89 G 100% 

Kurramia 10km N of Kalgoorlie P26/02985 1.93 A 100% 

13 105.94 

KAMBALDA DOMAIN Mount Martin Project: Au-Ni 

Cutters Luck 50km SSE of Kalgoorlie E26/00080 53.20 A 100% 

Cutters Luck 50km SSE of Kalgoorlie M26/00667 2.27 A 100% 

Mount Martin 40km SE of Kalgoorlie P26/02907 1.60 A 100% 



5 60.73 


8.0 Continued 




SOUTHERN CROSS PROVINCE Bungalbin Project: Au-Ni 

Bungalbin 100km NNE of Southern Cross E77/00860 2.96 A 100% 

Mount Dimer 120km NNE of Southern Cross E77/00946 196.00 A 100% 

Timberfield 130km NNE of Southern Cross E77/00947 89.60 A 100% 

Yeeding Hill South 100km NNE of Southern Cross E77/00975 196.00 A 100% 

Yendilberin Hills 100km N of Southern Cross E77/00976 109.20 A 100% 

Yeeding Hill 110km N of Southern Cross E77/00978 5.60 G 100% 

Bungalbin 100km NNE of Southern Cross E77/01019 109.20 A 100% 

7 708.56 

SOUTHERN CROSS PROVINCE Bungalbin Iron Project: Fe 

Bungalbin 100km NNE of Southern Cross E77/00842 112.58 G 100% 20 

Mount Jackson 105km N of Southern Cross E77/00896 36.40 G 100% 20 

Mount Jackson 105km N of Southern Cross E77/00919 56.00 G 100% 20 

3 204.98 

20 

Portman Limited has an Option to acquire the Iron Ore rights through a Production Royalty payment. Heron holds all other 

mineral rights. 

SOUTHERN CROSS PROVINCE Maggie Hays Hill Project: Ni-Au 

Maggie Hays Hill 140km SE of Southern Cross E63/00625 81.20 A 100% 

1 81.20 


page 77

8.0 Continued 




BREMER-EUCLA PALAEODRAINAGE PROVINCE Balladonia Oil Shale Project: Oil Shale-Sulphur-Lst 

The Yates 142km S of Norseman E63/00731 196.00 A 100% 21 

Mt Beaumont 151km SE of Norseman E63/00732 196.00 A 100% 21 

Charlina Rocks 154km ESE of Norseman E69/01473 196.00 A 100% 21 

Balladonia 170km E of Norseman E69/01474 196.00 A 100% 21 

Boingaring Rocks 156km E of Norseman E69/01475 196.00 A 100% 21 

Afghan Rock 184km E of Norseman E69/01476 196.00 A 100% 21 

Balladonia West 156km E of Norseman E69/01477 196.00 A 100% 21 

Charlina South 150km ESE of Norseman E69/01478 196.00 A 100% 21 

Charlina West 142km ESE of Norseman E69/01479 196.00 A 100% 21 

Curnadinia Rock 162km ESE of Norseman E69/01480 196.00 A 100% 21 

Yalodinya Rock 157km ESE of Norseman E69/01481 134.40 A 100% 21 

Charlina East 164km ESE of Norseman E69/01482 81.20 A 100% 21 

Balladonia Central 170km E of Norseman E69/01483 39.20 A 100% 21 

Chidalinya Rock 185km E of Norseman E69/01492 106.40 A 100% 21 

Jerandilla 185km E of Norseman E69/01493 196.00 A 100% 21 

Eclipse Hill 185km SE of Norseman E69/01495 196.00 A 100% 21 

Bonnie Hill 175km SE of Norseman E69/01499 196.00 A 100% 21 

Florabell Hill 195km SE of Norseman E69/01500 196.00 A 100% 21 

Heinsman Rock 191km SE of Norseman E69/01582 196.00 A 100% 21 

Namelonia Rock 187km SE of Norseman E69/01583 196.00 A 100% 21 

20 3,497.20 

21 

Draft Memorandum of Understanding in preparation to develop Oil Shale resources. Heron holds all other mineral rights. 

BREMER-EUCLA PALAEODRAINAGE PROVINCE Ravensthorpe-Norseman Oil Shale: Oil Shale 

Geordie Rock 93km SSW of Norseman E63/00720 112.00 A 100% 21 

Lake Cowan 60km NE of Norseman E15/00570 204.01 A 100% 

Lake Cowan 60km NE of Norseman E15/00632 19.60 A 100% 

Balladonia West 9 20km NE of Norseman E15/00656 61.60 A 100% 21 

Balladonia West 7 65km E of Norseman E63/00709 196.00 A 100% 21 

Balladonia West 10km E of Norseman E63/00712 196.00 A 100% 21 

Lake Dundas 35km S of Norseman E63/00736 64.40 A 100% 21 

Lort River 110km SSW of Norseman E74/00278 151.20 A 100% 21 

Flower 170km SW of Norseman E74/00279 193.20 A 100% 21 

Lake Three Star 155km SW of Norseman E74/00280 193.20 A 100% 21 

Lake Sharpe 130km SW of Norseman E74/00281 196.00 A 100% 21 

Recruit Hill 93km SW of Norseman E74/00282 196.00 A 100% 21 

Lake Fitzgerald 92km SW of Norseman E74/00283 196.00 A 100% 21 

Mount Deans 10km S of Norseman M63/00417 9.87 A 100% 21 

Mount Deans 10km S of Norseman M63/00418 9.26 A 100% 21 

Lake Kirk 8km SW of Norseman P63/01114 1.69 G 100% 21 

Lake Kirk 10km SW of Norseman P63/01115 1.86 G 100% 21 

Lake Kirk 6km SW of Norseman P63/01116 1.95 A 100% 21 

Lake Cowan 5km SW of Norseman P63/01119 1.06 G 100% 21 




22 2,008.96 

21 

Draft Memorandum of Understanding in preparation to develop Oil Shale resources. Heron holds all other mineral rights. 

TOTAL 419 14,919.00 

A = Application G= Granted B = Exploration Licence Application in Ballot 


Glossary of Terms 

Heron Resources NL page 79 

“Aeromagnetic Survey” means a survey made from the air, recording variations in the earth’s magnetic field. 

“Alteration” means rock-forming minerals which have been chemically changed. 

“Anomaly” means a value higher or lower than expected, which outlines a zone of potential exploration interest but not necessarily 

of commercial significance. 

“Aircore drilling” means a rotary drilling technique which uses compressed air to cut a core sample and return core fragments to 

surface inside the drill rods. The system has problems with the penetration of non-weathered bedrock. 

“Au” means gold. 

“Autoclave” means a reaction vessel in which ore is mixed with high temperature and pressure solutions to enable metals to enter 

into solution as a precursor to extraction in metallic form. The autoclave is titanium lined, to prevent corrosion. 

“BCM” means Bank Cubic Metre, which is a unit of volumetric measurement of undisturbed rock material. 

“Co” means cobalt. 

“Cu” means copper. 

“Electrowinning” means a metallurgical process whereby metal is recovered from a metal bearing electrolyte solution through 

deposition onto a metal cathode. 

“Feasibility Study” means: 

A “Pre-feasibility Study” is an engineering and cost study of a mining operation, processing plant and plant infrastructure, 

which for the Goongarrie Nickel Project includes a flow sheet of the “Cawse” type that covers ore beneficiation, high pressure 

acid leach, Counter Current Decantation washing, solution purification, cobalt and nickel solvent extraction, formation of an 

intermediate precipitate and electrowinning to produce nickel metal. Included in the cost estimates will be infrastructure, 

tailings disposal, power supply, and owner’s costs. The plant design may change as a result of testwork analysis, 

optimisation studies and engineering improvements performed during execution of the Pre-feasibility Study. Operating and 

capital cost estimates are to an accuracy of +/- 30%. In the case of the Goongarrie Nickel Project, the drill density would be 

such that the resource status is Indicated Mineral Resource. 

A “Bankable Feasibility Study” is an engineering and cost study addressing the same issues as a “Pre-feasibility Study”, but 

in such detail that it contains sufficient information to satisfy a bank, that it can rely on cash flows and earnings from the project 

to repay any project loan, and that the assets of the project are suitable as collateral for the loan. The bank must feel 

comfortable that on a worst case scenario the loan will be repaid. Engineering design concepts will have largely been 

finalised, and operating and capital cost estimates are to an accuracy of +/- 10%. In the case of the Goongarrie Nickel 

Project, the drill density would be such that the resource status is Proved Ore Reserve. 

“Geochemical Survey” means the systematic study of the variation of chemical elements in rocks or soils. 

“Gossan” means the weathered oxidised iron-rich surface expression of a sulphide-bearing deposit. 

“g/t” means grams per tonne, which normally relates to precious metals. 

“Granitoid” means a family of coarse-grained igneous rocks that contain abundant quartz and feldspar. 

“km” means kilometres. 

“km 2 ” means square kilometres. 

“Komatiite” means an ultramafic rock with high magnesium content extruded from a volcano. Textural variations include: 

“Orthocumulate” means a rock which exhibits a high proportion of crystallised trapped interstitial (“intercumulus”) liquid. The 

surrounded (“cumulus”) olivine crystals are subhedral to euhedral in form. This komatiite type is regarded as very prospective 

for nickel sulphide mineralisation. 

“Mesocumulate” means a rock with cumulus crystals exhibiting extensive mutual boundary contact, but retaining some 

recognisable interstitial material. This komatiite type is regarded as prospective for nickel laterite mineralisation. 

“Adcumulate” means a rock with little or no intercumulus material and characterised dominantly by anhedral crystals. This 

komatiite type is regarded as prospective for nickel laterite mineralisation. 

“Limonite Ore” means nickel-cobalt laterite ore composed mainly of the iron minerals goethite-limonite (+40% Fe 2 O 3 ), which is an 

optimum ore type in terms of leaching rheology. 

“m” means metres. 

“Mineralisation” means, in economic geology, the introduction of valuable elements into a rock body. 

“Ni” means nickel. 

“Nickel Laterite” means nickel and cobalt occurring as an oxidised ferruginous clay assemblage overlying weathered ultramafic. 

“Oil Shale” means a sedimentary rock containing low grade lignite coal and a hydrocarbon material termed kerogen. 

“Olivine” means a magnesium-iron silicate mineral, often occurring in rocks prospective for nickel. 

“Option” means a Share option to subscribe for fully paid ordinary Shares in Heron. 


Glossary of Terms 

Continued 

“PAL” means Pressure Acid Leach, a nickel laterite processing technique in which ore is dissolved in hot high pressure 

sulphuric acid contained within a titanium-lined reaction vessel termed an autoclave, to release nickel and cobalt into solution, 

for precipitation as an intermediate product or pure metal. 

“PGE” means Platinum Group Elements. 

“prospect” means a target upon which exploration programs are planned or have commenced. 

“project” means a grouping of prospects within a specific geographic location, often with a common geological setting. 

“province” means a grouping of projects within a geological district defined by a major mineralised crustal structure. 

“ppb” means parts per billion. 

“ppm” means parts per million. 

“RAB drilling” means the drilling technique in which a sample is returned to surface outside the rod string by compressed air. 

Sample quality is poor. 

“RC drilling” means the drilling method employing a rotating or hammering action on a drill bit which returns a sample to the 

surface inside the rod string by compressed air. Sample quality is very good, particularly if the drill hole is dry. 

“Resource and Ore Reserve” means: 

“Proved Ore Reserve” is the economically mineable part of a Measured Mineral Resource. It includes diluting materials 

and allowances for losses which may occur when the material is mined. Appropriate assessments, which may include 

Feasibility Studies, have been carried out, and include consideration of and modification by realistically assumed mining, 

metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments 

demonstrate at the time of reporting that extraction could reasonably be justified. The term “economic” implies that 

extraction of the Ore Reserve has been established or analytically demonstrated to be viable and justifiable under 

reasonable investment assumptions. Proved Ore Reserve will require some degree of lateral continuity validation through 

diamond drilling, wide diameter (900mm) bulk sample drilling, trial mining, exploration winze or most likely for Goongarrie, 

10x10m pattern RC drilling. 

“Measured Mineral Resource” is that part of a Mineral Resource for which tonnage, densities, shape, physical 

characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and 

reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as 

outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and/or 

grade continuity. At the Goongarrie Nickel Project, Heron’s least dense drill RC pattern for Measured Mineral Resource 

status is 20x20m. 

“Indicated Mineral Resource” is that part of a Mineral Resource for which tonnage, densities, shape, physical 

characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on 

exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, 

trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological 

and/or grade continuity but are spaced closely enough for continuity to be assumed. At the Goongarrie Nickel Project, 

Heron’s least dense RC drill pattern for Indicated Mineral Resource status is 80x80m. 

“Inferred Mineral Resource” is that part of a Mineral Resource for which tonnage, grade and mineral content can be 

estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological 

and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as 

outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability. At the 

Goongarrie Nickel Project, Heron’s least dense RC drill pattern for Inferred Mineral Resource status is 400x80m. 

“ROM” means run of mine ore, referring to the grade and type of ore that is expected to be fed to the processing plant on a 

day to day basis. 

“Rift” means a zone of crustal extension in which the predominant sediment deposition is conglomerate, and the predominant 

volcanic activity is a bimodal basalt-rhyolite association which is intruded by co-magmatic granitoids. The high geothermal 

gradients of rifts are very favourable for gold deposits. 

“Shear Zone” means a zone in which crushed rock has been produced by the action of a shearing stress as on a fault. 

“SiCo” means a siliceous pyrolusite bearing Nickel Laterite Ore which typically assays in excess of 0.5% Mn, 0.2% Co and 

1.0% Ni. At Goongarrie South, “SiCo” Ore typically occurs at the top of ore zones. 

“Specific Gravity” or “SG” means the mass per unit volume of material, usually in reference to ore and waste. 

“Waste: Ore ratio” means BCM of waste + BCM of low grade sub-ore divided by BCM of ROM ore. 

“Tectonic Zone” means a major structural feature characterised by deformation of several kilometres in width. 

“Ultramafic” means rocks composed almost entirely of mafic minerals which are prospective for nickel mineralisation. 

“VMS” means volcanogenic massive sulphide, which relates to base metal Cu-Zn-Pb-Au-Ag sulphide mineralisation. 

“XRD” means X-ray Diffraction, which is an analytical means of identifying microscopic clay minerals. 



In the Community 

The Artists: 

East Kalgoorlie Primary School 

Grades 3 to 7 

Back Row, from left: 

Derrick Sceghi, Kenneth Jackson, 

Wyvern Jackson, Kevin Banks, 

Teacher: Amber Lewington, 

Merita Stevens, Naomi Ellis, 

Krystal Foley, Andrea Munmurrie 

Front Row, from left: 

Natalia Tucker, Tony Champion, 

Shane Stokes, Leith Stevens, 

Salena Abdullah, Marika Smith, 

Kim-Thi Nguyen, Joelene Tucker 

Absent: 

Charis Abdullah, Cheynne Graham, 

Andrew Abdullah 

Doreen, Paula, Eva and Coral from NTP at 

the new childrens health clinic 

which Heron has helped to purchase. 

Project Geologist (and star 

winger for Boulder Rugby 

Union Football Club) 

Simon Gobbett and 

Administration Manager 

Sue Geary. 

Please telephone Sue on 

(08) 9091 9253 

if you wish to discuss any 

aspect of Heron’s operations. 

The Heron Team at the 

Balzano Barrow Race. 

Laverton Centenary 

Cricket Tournament 

Heron Hospitality Tent 

Ian Buchhorn, Pam Buchhorn 

and Shyama Peebles, the 

Centenary Events 

Co-ordinator. 


Exploration and 

Administration Office 

21 Close Way, West Kalgoorlie 

Heron sponsored an Art Prize and Exhibition for the students of East Kalgoorlie Primary School. Salena’s work was selected to feature on the front cover. 

Other works featured throughout this report are testimony to the creative skills of the students of East Kalgoorlie Primary School. 

Heron would like to thank the team at Reynolds Graphics for their expertise and professionalism in the design and production of this report.


21 Close Way, West Kalgoorlie 

PO Box 1280, Kalgoorlie, 

Western Australia 6430 

Telephone: (08) 9091 9253 

Facsimile: (08) 9091 9256 

Email: heron@emerge.net.au 

www.heronresources.com.au 

Heron, with the Rotary Club of Hannans and Rotary International 

supports the special education needs of East Kalgoorlie 

Primary School. One project involved minesite and bush 

excursions, with the children’s impressions captured in their art. 

Salena Abdullah’s painting was chosen to feature 

on the cover of this report. 

The title of Salena’s painting is “Binduli”. 

“My painting is of the manmade and natural environment. 

In the background is the revegetated land. 

In front is a road that leads to the mine. 

The colour represents the earth”. 

The accompanying photographic image of the Heron 

Goongarrie Project on the front cover can also be described by 

Salena’s words. 

Reynolds Graphics, Kalgoorlie 11839

2000 Annual Report - Heron Resources Limited

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