The Woods Point Gold Project
Background & History
Morning Star Gold’s key project area is centred at the historic mining town of Woods Point, which is located in the northern part of Victoria’s ‘Gippsland’ region, or as some consider it, the lower part of the Victorian Alps. It is accessed in around 3 hours by road from Melbourne via Healesville, Marysville & Matlock. Morning Star has literally hundreds of historic mines & gold bearing ‘dykes’ on its tenements around Woods Point, Matlock & Gaffney's Creek, many with rich production history of high-grade gold from Quartz Reefs and alluvial sources.
The area encompassing the Woods Point goldfield and the multiple high-grade gold bearing dyke structures located north towards Jamieson & south towards Walhalla formed one of the most significant mining fields in Australian history. Historical gold production was at least 155 tonnes or more than 5 million ounces of over a century of mining with an average production grade exceeding 27 grams per tonne. The bulk of this recorded production came from just a handful of mines. One of the key historical production hubs in this area was the famous ‘Morning Star’ mine, which is situated adjacent to Woods Point Township. The Morning Star mine produced almost 1 million ounces at 27 grams per tonne, operating fairly continuously between 1861 & 1963 with a long break between Jan 1939 & the late 1940s due to devastating bushfires across north-eastern Victoria and WWII.
Stage 1:
Morning Star Mine Redevelopment - COMPLETED Q3 2007
Historically the Morning Star mine was around 940 metres deep with one large vertical shaft & a smaller, deeper inclined shaft, over 23 levels in total. MCO has dewatered & completely refurbished all infrastructures to ~310 metres below surface. Drives between Levels 4 and 9 have been systematically surveyed, mapped and re-sampled by way of Reconnaissance & Channel Sampling, much of which was reported over the past few quarters. Gold assay grades reported were very encouraging with the first 160 dyke + reef samples returning an average grade exceeding 78 grams per tonne. The Shaft Refurbishment and Reconstruction stage is now completed as planned at just below Level 10 of the Morning Star mine. This has been a program which originally commenced back in 1998 and has cost around $10mm. The completion of this vital stage now paves the way for the extensive underground diamond drilling program MCO has planned via two Company-owned and operated drill rigs from 5 cuddy positions on Level 9.
Stage 2:
Diamond Drilling the ‘Gap Zone’ - COMMENCED Q4 2007 & ongoing over H1 2008
MCO knows there are substantially under-explored and undeveloped areas within the Morning Star mine. As a result, MCO’s plan has been to create underground access for extensive channel sampling & an underground diamond drilling program targeting areas of the mine which were largely unexplored & undeveloped by the last operators of the mine - Western Mining Corp. (Gold Mines of Australia). The primary exploration area MCO is targeting exists between Level 9 and Level 15 (250 - 650 metres deep) of the existing mine and is called the ‘Gap Zone’. This area is estimated to contain at least 65 million tonnes of highly prospective dyke material and is intersected by the main vertical mineshaft, which provides excellent access for exploration drilling.
Extensive underground drilling from Level 9 targeting the aforementioned 'Gap Zone' (between the 250m and 650m depths) commenced in Q4 2007. Two new Kempe Diamond Drills rated to around 200m in LTK48 sized core, were purchased by the company and will be used to conduct a series of holes, initially comprising around 3,400 metres, probing known auriferous zones and quartz reefs in the Morning Star mine. A brief depiction of this program (and others planned) is provided on this website under ‘Morning Star Mine – Drilling Overview H2 2007’. Drill holes (MS399-MS427) have been reported on to date (Q1 2008). Drilling is ongoing at 2 separate sites on the 9L of the mine. Recent highlights can be found at this link: 
GAP ZONE DRILLING UPDATE - JULY 2008 (0.69 Mb)
Why does the ‘Gap Zone’ exist?
Several consortiums & companies ran the Morning Star mine since its inception in 1861 as the Morning Star Mine Co. Ltd. Among those was the mine’s major operator Gold Mines of Australia (Western Mining). WMC had been successfully mining for rich returns since the late 1920’s, working their way down through the ‘dyke’ or host rock containing repetitive gold bearing quartz reefs. Their success had included massive returns (greater than 100,000 ounces per level) of high grade gold from famous reefs such as ‘Burns’ around Levels 5 & 6 and ‘Whitelaws’ around Levels 5 & 7.
The catastrophic ‘Black Friday’ Bush Fires of January 1939 wiped out the whole town of Woods Point and the entire above ground infrastructure at the Morning Star mine. The resultant lack of infrastructure, coupled with the outbreak of World War II which took away many miners, caused WMC to cease mining at the Level 9 underground and instead re-commence exploration activity, sinking the shaft as fast & deep as possible looking for the most accessible quartz reefs. Between Levels 16-19 underground, WMC found and mined the famous ‘Achilles’ & 'Stirling' Reefs including the rich Exeter Stope, which was one of the richest single reefs ever mined in Australia yielding over 250,000 ounces of gold.
WMC continued operating the Morning Star mine between Levels 19 & 23 - with small forays only above the Level 16 - until late 1959 when low Gold prices (fixed at USD35oz), the high cost of electricity (as Woods Point was not yet on the Victorian state grid) & their hunger for W.A. nickel led them to close all gold mining operations in the Eastern states. Consequently, the Morning Star mine was shutdown & never mined between Levels 9 & 15 underground leaving what we believe is a huge ‘gap’ zone of potentially ore bearing dyke. Our exploration resource target for this ‘Gap Zone’ is between 1.5mm- 2 mm ounces. This target is assumed looking at the tonnage of dyke, the number of repetitive quartz reefs known to exist and the production returns of gold ounces per vertical metre within the mine, which is 2000-5000 ounces per metre historically.
Stage 3:
Exploring Rich Regional Dykes - UNDERWAY H2 07 / ONGOING 2008
MCO believes there are also substantially under-explored areas on its current tenements including high-production old mines and dykes, many of which produced high grade gold only above the water table as historically, sub-artesian water level mining was hampered by lack of power to run pumps.
Running concurrently with the Morning Star mine ‘Gap Zone’ project is MCO’s Regional Exploration Program. The Regional Exploration Program commenced last quarter endeavouring to establish an exploration resource target in the surrounding old mines and under-explored dykes contained within existing and recently granted Mining Licences held 100% by Morning Star Gold N.L.
MCO’s key regional targets include mines and dykes such as the 'Waverly' (+50,000 ounces production), ‘All Nations’ (132,000 ounces), the ‘Comet’ (64,000 ounces), and the ‘Loch Fyne’ (109,000 ounces). These mines all produced the majority of their golden ounces from very shallow workings. MCO plans to test the depth of these dykes and the presence of deeper quartz reefs through deep diamond drilling over 2008. The first major announced target is at the Waverly line of workings, which yielded ~50,000 ounces of gold from quite shallow & surface workings. The Waverly dyke is at least 4kms long and mining licences covering its strike length are held by Morning Star. Drilling at the Waverly line is commenced in June 2008 and whilst a Woods Point alpine Victorian Winter presents challenges for surface drilling, weather permitting, drilling will continue over H2 2008.
Morning Star Gold has also recently secured several large new Mining & Exploration Licences, which have increased the company's tenement position tenfold (from 20km2 to 220km2+) in the Woods Point Dyke Swarm along three lines of dyke - Ross Creek, Tingha and All Nations. These newly granted licences cover mines and workings with significant historical production of gold from shallow workings.
