- Goldrea's efforts are a joint venture with China Rushan in Shandong Province to explore along strike and down dip from the existing 1,750 tonnes per day open pit gold producer. The license entails some 65,000 hectares with a major focus being three areas on the mineralized horizon located on the east and west sides of the Shandong Daye Mine.
- The JV area on the east and west zones contain an inferred resource (based on limited drilling, trenching and underground development as reported by Rushan City) of 707,717 oz of gold (which are not NI 43-101 compliant) and which Goldrea will review and bring up to NI 43-101 standards. Only 40 holes, including the discovery holes, were adequate for the existing Shandong Daye open-pit mine which had been producing at 65,000 ounces/year gold for seven years. Rushan City has granted the right to Goldrea to buy the existing mine and mill based on a mutually-agreed appraisal price.
- The JV contract calls for Goldrea to invest C$2 million over a four-year period for 74% of a 650 square KM region. China Rushan will have the option of contributing 26% of the going forward expenditures or dilute to a 10% net profit interest.
- Drilling by Goldrea commenced in mid-January 2005 500 metres down-dip from the Shandong Daye Gold Mine. Since the ore bodies are near surface, they make for economical drilling.
- The Shandong Daye Gold Mine includes two operating processing plants rated at 800 tonnes per day and 1500 tonnes per day.
- Gold Fields Ltd. has recently announced a joint-venture interest in similar gold properties located in the Shandong Province.
The Daye Mine is strategically located within senior water and power rights giving the owners a leading advantage to be involved with mining operations
and deposits within a 50 km radius. Recent exploration by Goldrea has indicated significant mineralization is located along strike and downdip from the
existing operations. Goldrea views the purchase of the Daye Mine as an excellent opportunity to establish the company as a prominent foreign miner in China.
The next phase of the exploration work at Daye is underway, and includes the sinking of three additional shafts for exploration and production.
Drill and trench assay results in the open pit worked by the Daye Mine generally indicated gold grades in the sericite sulphide breccia of from 1.5 to
2.0 gpt. However, the Daye Mine reports recoveries from these same areas yielded 3.5 to 4.0 gpt. Such variances are often noted in deposits containing
free gold. This phenomenon is often referred to as the nugget effect. The production from the Golden Rose Shaft will provide further information on the
effects of this nugget effect in the lateral extensions from the Daye ore body which make up the Goldrea Resources Corp. joint venture ground.
Assay grades range to 1.0% copper and 5.0 grams per tonne gold. In the southwest, this anomaly coincides with a 2,500 meter long by 300 meter wide zone of
quartz vein stock-working with gold grades ranging to 2.5 grams per tonne. The large footprint indicated by geochemistry and geophysics regimes suggests
the presence of a much larger underlying system.
An NI 43-101 report prepared by Norm Tribe, P. Eng., recommends a first phase $250,000 work program entailing prospecting, geophysics and 1,200 meters of
diamond drilling in seven holes. The drill holes are spaced 3.2 kilometers of strike length targeting areas of inferred resources and down dip under the
existing open-pit (all within the joint venture area). These holes will be approximately 100-350 metres deep and will confirm the mineralized horizon as
well as confirm previous drilling which reported ore grade.
In addition to the Daye Mine Lease, there are 11 leases approved and applied for by China Rushan and are included in the joint-venture. Most of these
leases have soil and/or geophysical anomalies associated with them. The Company will commence its exploration program once an agreement has been approved
and a business license granted.