Today we released an update on Condobolin, highlighting the newly defined Meritilga prospect. This prospect sits in the middle of a very large geochemical anomaly and alteration zone that links the Phoenix, Mascotte and Potters prospects. Preliminary results from the recently completed 3D IP survey suggest that chargeable anomalies are also present in the same area. The processing of the 3D IP data will be completed soon so stay tuned for further updates.

Clancy is now gearing up for a substantial drilling campaign and we recently signed a binding preferred driller MoU with Australian Mineral and Waterwell Drilling Pty Ltd (AMWD) for up to $5M of drilling.

Aeromagnetic and radiometric surveys have been completed at Condobolin, Currumburrama, Roseholme and Billabong Creek and numerous target areas have been defined for follow-up. Auger soil surveys have been completed or are in progress at Condobolin, Cundumbul and Gobondery with results expected in the next few weeks. Auger soil surveys are also planned for Orange East and Billabong Creek.

We now hope to be drilling at Condobolin in September. The aeromagnetic and radiometric survey identified several areas of interest and we thought it prudent to test these areas with soil geochemistry to deliver further drill targets for the forthcoming drilling. A 3D IP survey is also scheduled for mid-August. We are really excited about  the potential at Condobolin.

The remaining half of 2011 will continue to be a busy. The exploration and support team has been expanded in Orange and we are well funded. Clancy has a booth at Diggers and Dealers, which starts today, so it will be interesting to find out what the general mood of the industry is. Stay tuned for more regular (hopefully!) updates.

The ex date for the rights issue is 6 May 2011.

The funds will be deployed at Condobolin, Trundle and Orange East with drilling planned in the current quarter, and to advance early stage exploration at a number of other projects. We are currently flying aeromagnetic and radiometric surveys at Billabong Creek and Condobolin, following the completion of surveys at Roseholme and Currumburrama. The data from the latter surveys have been processed and a number of anomalies have been identified for follow-up.

The drilling was able to confirm that the vein samples we obtained from the mullock are indeed the same lodes we intersected in the drilling. Achieving this sort of outcome, as everyone in the exploration game would know,  is much easier said than done. And to do it at multiple prospects on the same tenement is a testament to the fact that there’s much more to be found within the Condobolin Mineral Field.

Most of the RC holes were drilled at Phoenix where the old timers mined high grade gold from workings that were up to 60m deep over widths of up to 10m. Our holes targeted the strike and dip extensions of the workings and the results have confirmed that good gold grades persist at depth and along strike. It looks like we have at least one decent sized lode (8m drilled width) dipping to the SE, at a consistent grade (3.7g/t Au) with higher grade zones up to 10g/t Au. This lode is open down dip and along strike to the south. The old timers mined visible gold (VG) at Phoenix. We have not seen any VG yet but we did some screen fire assays which confirmed that there is coarse gold at Phoenix and the plan is to submit other mineralised intervals for screen fire assay to check for coarse gold.

We are keen to return to Phoenix as soon as possible and hope to have diamond drilling program underway there within the next month or two.

Drilling at the other prospects, Mascotte, Potters and Bluebell, confirmed that there is significant potential for silver-lead-zinc-gold lodes. We only drilled one hole at Potters but got some tantalising results from it: 6m @ 2.7% Zn, 2.7% Pb, 30g/t Ag within a broad Zn halo (24m @ 0.9% Zn).

So we are pretty excited about what we have found so far and we think there is something fundamental going on in the Condobolin Mineral Field in terms of the potential scale of the mineralised system/s. It’s an area that has been overlooked in the past and from what we have seen in our drilling, there is plenty of blue sky not only around the previous workings, but also in the broader district.

We have recently increased our ground holdings in the area and we will be flying a high-resolution aeromagnetic and radiometric survey in the next few weeks, which will assist in targeting other areas beyond the old workings.

The average depth of our drill holes is 124m and most of the skarn intervals are less than 50m vertical depth, so there is plenty of scope to potentially define shallow low- to moderate-grade gold and copper resources. Also the significant amount of magnetite means the intervals are quite iron rich as well, so we will be investigating that further as demand for magnetite is quite strong at the moment and a rail line runs right through the project.

Work by previous explorers identified potential for a large hydrothermal system at Trundle Park but rock types from shallow drilling suggested that it was too deeply eroded to be prospective for higher level and higher grade epithermal style mineralisation. However, one of the things we noticed during mapping prior to drilling was a fair amount of epithermal-style veins in subcrop and mullock around the old workings at Trundle Park which was contrary to previous interpretations. Our initial assessment is now supported by these drill hole assays.  The trace element data in our RC results were elevated in arsenic, bismuth, tellurium and antimony for some intervals, which is typical of epithermal mineralisation.

We intersected an epithermal vein 75m south of some old workings and we think the old timers probably mined a high grade epithermal quartz vein (the rule of thumb being that they wouldn’t have mined much below one ounce or 31.1g/t Au). The quartz vein we intersected had a pink to purple mineral phase, which may be fluorite but we need petrology to confirm that. The vein ran 20g/t Au and nearly 7% Cu over a 2m composite (see the release)  and we think we have drilled the southern strike of the vein that was mined previously. The vein is open at depth and along strike and we will get a rig back there to follow it up as soon as we can.

On a final note, exploration activity in NSW is obviously picking up because the ALS lab in Orange is chock-a-block with everyone’s samples, so our turnaround times  have dropped off a little bit. The good news is that ALS are planning a lab upgrade, so in a few months time their throughputs will increase. In the meantime, we expect to have the Condobolin RC drilling results finalised within the next couple of weeks and I’m looking forward to reporting those results, so stay posted.

Regards,

Gordon

RC drilling commenced at Condobolin on January 24th (see here). This program is currently in progress and is about two-thirds complete. Drilling has been completed at the Phoenix and Bluebell prospects to date. Heavy rainfall last week has delayed the program a little with about 2.5 days of rain delays to date. The rig resumed drilling on Saturday 5th February and barring any further rain, we should complete the program later this week.  Final results for the Condobolin drilling are expected in late February to early March.

I look forward to reporting the results of the above drilling programs as they come to hand.

Regards,

Gordon

Well it has certainly been a busy start to the year. RC Drilling is in progress at Trundle (started on Saturday January 8th). We are targeting some shallow gold-copper skarn mineralisation and testing for a deeper porphyry source at the Trundle Park prospect (see here). Some  local thunderstorms and lightning made for a slow start to the drilling but progress is now picking up although we will be keeping a close eye on the weather.

We are also busy at Condobolin where plans are well advanced for a drill program in the not too distant future. The plan is to follow up the very high-grade gold, copper and zinc rock chip results that we uncovered near historic workings in our first field program in October (see here).

Aeromagnetic surveys will be carried out at our Roseholme, Currumburrama, Billabong Creek and Condobolin projects in February 2011. The first two are gold-copper porphyry projects and the latter two are epithermal gold-copper projects.

We are also expecting a very active year on our seven joint venture projects with Gold Fields in NSW, which will include a substantial amount of drilling. More details on that program will be provided in the coming weeks.

At the Yalgoo project in WA we completed a ground magnetic survey last month. The survey covered a couple of interesting looking aeromagnetic anomalies and we are modelling that data now. Yalgoo is right next door to MMG’s Golden Grove base metal mine.

Last week we announced two new Tasmanian joint ventures with Minemakers subsidiary TNT Mines on the Oonah and Waratah tin projects. Oonah is north of Zeehan and Waratah surrounds (but does not include) the Mt Bischoff tin mine (see here). We also have two joint ventures for zinc and gold with Bass Metals in the Mount Read Volcanic Belt. I look forward to providing more updates on our JV projects in Tasmania in the months ahead.

So there is a fair bit going on with a mix of 100% owned and joint venture projects in three states with four exploration teams (Clancy, Gold Fields, Bass and TNT Mines) chasing a mix of commodities – gold, copper, zinc and tin. Stay tuned for regular updates.

Regards,

Gordon

You may recall that we drilled in the north of the tenement earlier in the year at Mordialloc, but the main reason we were keen to pick up this tenement from the time we listed was the southern A class target at Trundle Park.  We were planning to drill this target in November but the weather delayed our plans.  We now have a rig lined up to start on 6 January 2011 and hopefully we can get the New Year off to a great start with some exploration success at Trundle Park.  I certainly hope so.

Kind Regards (and I’m pretty sure this will be the last time!)

Mark

We have felt for some time that there was a need to consolidate management in Orange along with the technical team that is based there, and Gordon indicated his willingness to take on that challenge.

As you are no doubt aware the excessive rainfall in the eastern part of the country has impacted exploration activities across New South Wales and we are no exception.  We are hopeful that our drilling that was planned at Trundle for November will be able to commence early in January, weather permitting.

It only remains for me to wish Gordon and the team well with their exploration activities in 2011 and I will be watching with great interest as a top 20 shareholder.

Best wishes to all of you for the Christmas Season and I hope you all have an extremely prosperous 2011.

Kind Regards

Mark

Following is a link to a Boardroom Radio interview with me regarding the very positive aspects of the recent changes to our register:   Boardroom Radio Interview with Mark Stewart – Clancy Welcomes New Investors

The end result of the sale of the Kiska (formerly Geoinformatics) block is that we have a much more open register with no particularly large positions being held which has provided much more liquidity and a broader shareholder base.  The stake was mainly taken up by high net worth individuals and institutions and we now have a very supportive shareholder group  to work with which is a very pleasing result.