Quarterly Report
January 31 2006 - 5:47AM
UK Regulatory
RNS Number:6799X
Leyshon Resources Limited
31 January 2006
LEYSHON RESOURCES LIMITED
ASX, AIM AND MEDIA RELEASE
DECEMBER 2005 QUARTERLY REPORT
Leyshon Resources Limited ("Leyshon" or "the Company") (ASX : LRL) is pleased to
present its Quarterly Report for the period ending 31 December 2005.
Final results from the 12,100 metre diamond drilling programme at the Zheng
Guang gold project were received. The results included further high grade gold
intersections and extremely encouraging results for zinc and silver.
Significant base metal (zinc, lead and copper) and silver associations have been
encountered, highlighting a positive association with the strongly gold
mineralized northwest- trending structures.
This association has the potential for significant economic benefit to the
project, enhancing the potential for the economic recovery of gold, zinc and
silver.
These final results have in the Directors' view further enhanced the development
potential of Zheng Guang which is the first resource project to be developed by
a foreign company in the mineral rich province of Heilongjiang.
The Company was admitted onto the London Stock Exchange's AIM market and trading
in the Company's securities commenced on 26 October.
Leyshon has its main operational office in Beijing and uses this base to review
opportunities for exploration and potential project development elsewhere in
China and neighbouring Mongolia.
For further information contact: Paul Atherley - Managing Director
Tel: +86 10 8528 9256
China Mob: +86 137 1824 3763
International: +61 417 475 038
DECEMBER 2005 QUARTERLY REPORT
Zheng Guang Gold Project
The 12,100 metre diamond drilling programme at the Zheng Guang gold project was
completed during the quarter. The programme was designed to infill drill
mineralized blocks defined in the 2004 drill programme, test for extensions at
depth and along strike and to gain a better understanding of the complex
geometry of the mineralized system.
The programme, which had eight rigs in operation at its peak, was ahead of
schedule with higher productivity than the previous year and reasonably good
overall core recovery.
When it became clear that a large proportion of the mineralization comprised
high grade, steeply east-dipping veins (ladder vein arrays) within the
west-dipping faults, two additional rigs with shallow angle drilling and larger
core capacity were mobilized to better test these mineralized blocks. The rigs
were also used to collect representative core for metallurgical testwork.
The angled holes, drilled both across and down the dip of the primary west
dipping faults, have confirmed a greater density of generally thin veins in some
areas and in other areas have intersected zones of thick mineralisation.
Table 1. Selected drilling results from Zheng Guang
Hole ID Co-Ord Co-Ord Sample Interval Width Au Ag Pb Zn
(Northing) (Easting) From (m) To (m) (m) gpt gpt % %
ZGD039 9840 49200 56 68 12 9.11 58 1.10 3.03
ZGD049 9780 49300 231 251 20 3.52 22 0.09 3.20
Incl. 240 242 2 8.15 46 0.40 7.24
Incl. 248 250 2 11.29 69 0.07 8.21
ZGD064 9810 49350 112 126 14 4.32 22 0.13 2.69
Incl. 116 118 2 10.11 59 0.42 7.33
Incl. 120 122 2 13.45 50 0.39 6.85
137 145 8 7.84 45 0.61 4.25
164 173 9 5.78 36 0.05 3.84
ZGD087 10038 49365 26 28 2 19.61 91 1.42 7.21
ZGD074 9970 49300 72 90 18 3.74 19 0.60 1.15
103 120 17 4.45 13 0.31 0.66
ZGD100 9845 49250 66 72 6 23.76 33 0.63 1.56
84 88 4 33.87 42 1.47 1.98
As expected with the mesothermal style of Zheng Guang mineralization, there are
significant base metals associations and in this case there is a strong
correlation between gold grades and the zinc and silver grades reported in the
assays. Interpretation of the geology and geochemistry of the high grade zinc/
silver mineralisation, which ranges up to 18% zinc and 150 g/t silver, has
highlighted a positive association with the strongly gold mineralized
northwest-trending structures.
Of considerable interest is the fact that the zinc and silver mineralization is
strongly correlated with the high grade gold mineralization. The zinc occurs as
sphalerite which is the most common economic zinc mineral and is readily
amenable to recovery by flotation. An example of the close association of gold,
zinc and silver is shown in the following table which represents a consecutive
zone of 7 metres of core:
+------------+----------+-----------+
| Au (g/t) | Ag (g/t) | Zn (%) |
+------------+----------+-----------+
| 0.24 | 2.37 | 0.184 |
+------------+----------+-----------+
| 0.95 | 8.01 | 0.506 |
+------------+----------+-----------+
| 5.80 | 32.20 | 2.997 |
+------------+----------+-----------+
| 1.69 | 10.16 | 1.788 |
+------------+----------+-----------+
| 7.65 | 35.30 | 4.068 |
+------------+----------+-----------+
| 0.48 | 4.46 | 0.127 |
+------------+----------+-----------+
| 0.07 | 3.00 | 0.070 |
+------------+----------+-----------+
This association has the potential for significant economic benefit to the
project, enhancing the potential for the economic recovery of gold, zinc and
silver.
The resource potential of the project continues to grow within a 1.25 kilometre
long mineralized corridor which is now viewed as having a substantial additional
potential to host higher grade gold, zinc and silver mineralization.
The mineralized corridor has been interpreted as a series of northwest oriented
strike-slip faults that now appear to extend from the Zheng Guang North
prospect, 1.25 kilometres south to the Zheng Guang Main Ore Zone.
The corridor has only been partially tested by previous drilling and is the high
priority target for the 2006 exploration programme that will commence as soon as
field conditions allow. Additional targets include the large geochemical
anomalies at Zheng Guang North - Southern extensions, West and East (refer
Company website: www.leyshonresources.com for a PDF version of this report which
includes a diagram showing the proposed exploration targets).
Assays have been prepared and reported by the Qiqihar Bureau of Geology and
Mineral Resources (BGMR) laboratory in Qiqihar, Heilongjiang. Assay verification
by SGS-CSTC Standards Technical Services (SGS) Tianjin on the BGMR repeat assays
and the SGS check fire assays has not identified substantial variation in
overall assay results generated from both laboratories.
The Directors are very encouraged by the final results from the highly
successful 2005 drill programme which in their view have further enhanced the
development potential of the project.
Zheng Guang is the first resource project to be developed by a Foreign Company
in the mineral rich province of Heilongjiang and the excellent results and rapid
progress to date will give all parties confidence in expanding the areas of
cooperation.
Leyshon's strategy is to apply the latest exploration and development techniques
to underexplored projects in China and its neighbouring countries with a view to
identifying and developing high quality projects. It has an established presence
in China and is one of the few resource companies with its main operational
office in Beijing.
Duobaoshan Copper Project
The Company is awaiting the outcome of a scoping study being undertaken by
Ausenco to enable it to determine whether it wishes to proceed with a
development proposal for this project.
New Business Opportunities
The Company continues to evaluate a number of acquisition and development
opportunities both within China and its neighbouring countries taking advantage
of its operating base in Beijing and knowledge gained operating in the country
over the past two years.
Corporate
Trading in the Company's securities commenced on the London Stock Exchange's AIM
market on 26 October.
Geological Information
The information in this report relating to Exploration Results, Mineral
Resources or Ore Reserves is based on information compiled by Mr Malcolm Wilson,
a full time employee of the Company, who is a member of the Australasian
Institute of Mining and Metallurgy.
Mr Wilson has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity which
he is undertaking to qualify as a Competent Person as defined in the 2004
Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Mr Wilson consents to the inclusion in the report
of the matters based on his information in the form and context in which it
appears.
Appendix 5B
Mining exploration entity quarterly report
Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.
Name of entity
LEYSHON RESOURCES LIMITED
ABN Quarter ended ("current
quarter")
75 010 482 274 31 December 2005
Consolidated statement of cash flows
Current quarter Year to date
Cash flows related to operating $A'000 (6 months)
activities $A'000
1.1 Receipts from product sales and - -
related debtors
1.2 Payments for (a) exploration and (1,035) (2,446)
evaluation - -
(b) development - -
(c) production (527) (914)
(d) administration
1.3 Dividends received
1.4 Interest and other items of a 92 204
similar nature received
1.5 Interest and other costs of finance - -
paid
1.6 Income taxes paid - -
1.7 Other - Business development (155) (224)
Net Operating Cash Flows (1,625) (3,380)
Cash flows related to investing
activities
1.8 Payment for purchases of:
(a) prospects - -
(b) equity investments - -
(c) other fixed assets - (3)
1.9 Proceeds from sale of:
(a) prospects - -
(b) equity investments - -
(c) other fixed assets - -
1.10 Loans to other entities - -
1.11 Loans repaid by other entities - -
1.12 Other
- Security bonds - 2
Net investing cash flows - (1)
1.13 Total operating and investing cash
flows (carried forward) (1,625) (3,381)
1.13 Total operating and investing cash (1,625) (3,381)
flows (brought forward)
Cash flows related to financing
activities
1.14 Proceeds from issues of shares, - -
options, etc.
1.15 Proceeds from sale of forfeited - -
shares
1.16 Proceeds from borrowings - -
1.17 Repayment of borrowings - -
1.18 Dividends paid - -
1.19 Other - capital raising costs - -
Net financing cash flows
- -
Net increase (decrease) in cash (1,625) (3,381)
held
1.20 Cash at beginning of quarter/year 7,733 9,489
to date
1.21 Exchange rate adjustments to item 18 18
1.20
1.22 Cash at end of quarter 6,126 6,126
Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related
entities
Current quarter
$A'000
1.23 Aggregate amount of payments to the parties 154
included in item 1.2
1.24 Aggregate amount of loans to the parties included -
in item 1.10
1.25 Explanation necessary for an understanding of the transactions
Payments include executive remuneration, director's fees, company
secretarial services and provision of a fully serviced office.
Non-cash financing and investing activities
2.1 Details of financing and investing transactions which have had a
material effect on consolidated assets and liabilities but did not
involve cash flows
Not Applicable.
2.2 Details of outlays made by other entities to establish or increase
their share in projects in which the reporting entity has an interest
Not Applicable.
Financing facilities available
Add notes as necessary for an understanding of the position.
Amount available Amount used
$A'000 $A'000
3.1 Loan facilities - -
3.2 Credit standby arrangements - -
Estimated cash outflows for next quarter
$A'000
4.1 Exploration and evaluation
300
4.2 Development
-
Total 300
Reconciliation of cash
Reconciliation of cash at the end of the Current quarter Previous quarter
quarter (as shown in the consolidated $A'000 $A'000
statement of cash flows) to the related
items in the accounts is as follows.
5.1 Cash on hand and at bank 618 1,209
5.2 Deposits at call
5,508 6,524
5.3 Bank overdraft
- -
5.4 Other (provide details)
- -
Total: cash at end of quarter (item
1.22) 6,126 7,733
Changes in interests in mining tenements
Tenement reference Nature of Interest Interest
interest at at end of
(note (2)) beginning quarter
of quarter
6.1 Interests in None - - -
mining
tenements
relinquished,
reduced or
lapsed
6.2 Interests in None - - -
mining
tenements
acquired or
increased
Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights
together with prices and dates.
Total number Number quoted Issue price Amount paid up
per security per security
(see note 3) (see note 3)
(cents) (cents)
7.1 Preference + 1,000 - Not Not Applicable
securities Applicable
(description)
7.2 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through
returns of
capital,
buy-backs,
redemptions
7.3 +Ordinary 131,466,558 131,466,558 Not Not Applicable
securities Applicable
7.4 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through
returns of
capital,
buy-backs
7.5 +Convertible
debt
securities
(description)
7.6 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through
securities
matured,
converted
7.7 Options Exercise Expiry date
(description 10,000,000 - price 30 June 2007
and conversion 8,500,000 - $0.20 each 30 June 2007
factor) 2,700,000 - $0.30 each 31 Dec 2007
$0.35 each
7.8 Issued during
quarter
7.9 Exercised
during quarter
7.10 Expired during
quarter
7.11 Debentures
(totals only)
7.12 Unsecured
notes (totals
only)
Compliance statement
1 This statement has been prepared under accounting policies which comply with
accounting standards as defined in the Corporations Act or other standards
acceptable to ASX (see note 4).
2 This statement does /does not* (delete one) give a true and fair view of the
matters disclosed.
Sign here: ....................................... Date: 31 January 2006
(Director/Company secretary)
Print name: MARK PEARCE
Notes
1 The quarterly report provides a basis for informing the market how the
entity's activities have been financed for the past quarter and the effect on
its cash position. An entity wanting to disclose additional information is
encouraged to do so, in a note or notes attached to this report.
2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of
interests in mining tenements acquired, exercised or lapsed during the reporting
period. If the entity is involved in a joint venture agreement and there are
conditions precedent which will change its percentage interest in a mining
tenement, it should disclose the change of percentage interest and conditions
precedent in the list required for items 6.1 and 6.2.
3 Issued and quoted securities The issue price and amount paid up is not
required in items 7.1 and 7.3 for fully paid securities.
4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive
Industries and AASB 1026: Statement of Cash Flows apply to this report.
5 Accounting Standards ASX will accept, for example, the use of International
Accounting Standards for foreign entities. If the standards used do not address
a topic, the Australian standard on that topic (if any) must be complied with.
== == == == ==
This information is provided by RNS
The company news service from the London Stock Exchange
END
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