DIO 0.00% $1.27 dioro exploration nl

Feasability Study Commences

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    DIO announced this morning the commencement of it's Frogs Leg feasability study, with open pit mining to commence at the end of 2002.

    ..........and the share price has fallen 1c so far....!

    Company Announcement

    Frog`s Leg Feasibility Study Commences


    HOMEX - Perth

    The board of Dioro Exploration NL ("Dioro") wishes to advise that the
    Mungari East Joint Venture has commenced a Feasibility Study into
    open pit gold mining at Frog's Leg.

    This study comprises a comprehensive drilling program to 'sterilise'
    the proposed waste-dump site, geotechnical and hydrogeological
    evaluations, metallurgical test work (assuming off-site ore
    processing), an update of the resource model with recoverable
    resources, final optimisation and pit design, and the completion of a
    'Notice of Intent'.

    The study has a substantial drilling component, with 11,000 metres of
    reverse circulation and aircore drilling allocated to the testing
    (sterilisation) of the proposed waste-dump site in a previously
    unexplored area west of the proposed Frog's Leg open pits, 1,000
    metres of diamond drilling in 8 holes to provide geotechnical
    information to aid in pit design, plus a number of exploratory water

    The Feasibility Study is scheduled to be completed by late September
    2002 at an estimated cost of $1 million (Dioro's share $490,000).
    Subject to completion of the Feasibility Study and process plant
    selection, open pit mining activities at Frog's Leg are still
    scheduled to commence by the end of calendar 2002.

    The pre-feasibility report indicated that, subject to the off-site
    process plant selected, total pre-open pit mining capital costs at
    Frog's Leg are estimated to be less than $2 million. Dioro's share of
    capital costs of $2 million would be $980,000.

    Based on the planned work program Dioro expects to fund its share of
    estimated Feasibility Study and pre-mining capital costs from its
    existing cash resources.

    At a gold price of A$550 per ounce (current price A$575) and
    estimated operating and capital costs of A$270 per ounce, the
    pre-feasibility study estimated that the Frog's Leg open pit mining
    project should return net cash flows of approximately A$18 million
    (before tax) over an 18-month period. The underground scoping study
    indicated that the project would then continue as an underground
    mining operation for around 8 years based on current resources.

    The exploration program for the second half of calendar 2002 is
    currently being finalised and details will be made available shortly.

    D McArthur

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