Investment in exploration remains an integral part of the Company’s strategy for growth, with a total of $14.07 million of expenditure in the 2009 financial year. A major proportion of this investment ($9.02 million) continued to be focused on programs designed to define additional oresupply for the Challenger Gold Operation. The cost effectiveness of these programs can be easily measured in terms of the additionalresource and reserve ounces defined, with resources being added at an exploration cost of $19 per ounce.

Elsewhere, exploration programs and strategies designed to create a pipeline to new mine developments are higher risk and more difficult to evaluate. All projects continue to be rigorously assessed, and an ongoing search for new projects is a fundamental strategy.

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