Exploration

Grand T G aims to increase its gold reserve and resources and the life of its mines through ongoing exploration programs in existing asset areas. This ensures cost-effective and timely drilling with an initial focus on discovering high quality gold resources for near-term production.

Exploration remains the most cost effective way to grow the Group’s gold resources. Through the Group’s exploration programs, new gold resources are discovered for not more than US$10 per ounce.

The Group will continue to devote its efforts and resources in the exploration of mines and during the year Taizhou Mining also completed a further stage of the exploration program, the preliminary results of which showed that there were additional gold resources of approximately of 6 tonnes. Subject to final testing, the Group’s gold reserve and resources will increase to about 47 tonnes for its China operation.

The Group will introduce deep level exploration in 2010 and step up exploration and development in and around its existing operations with a new exploration program being under contemplation with a budget cost of approximately RMB33 million. The Group targets to increase its gold reserve and resources by about 15 tonnes and lead resources of 30,000 tonnes with drilling work of 28,000 metres through the exploration program by 2011.