LIBERTY MINING INTERNATIONAL PTY LTD OYADAO ......Liberty Mining International Pty Ltd Confidential Information - unauthorised use prohibited Oyadao Project - Year 3 Progress Report

LIBERTY MINING INTERNATIONAL PTY LTD

OYADAO PROJECT

YEAR 3 PROGRESS REPORT

FOR THE YEAR ENDING 4TH JUNE 2009

North-Eastern Cambodia

Date: August 2009 Author Don Horn Submitted to Richard Stanger

This report and its contents are confidential. All rights to the report and its contents (including, without limitation, rights to confidential information and copyright in all works (including photographs, diagrams, charts, maps and graphs) comprised in the report) remain the property of Liberty Mining International Pty Ltd. No part of this report or the information contained in it may be disclosed to any person without the consent of Liberty Mining International Pty Ltd. No part of this report, or the information contained in it may be reproduced (including being stored in any form), transmitted, published or used for any purpose without the prior consent of Liberty Mining International Pty Ltd.

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Oyadao Project - Year 3 Progress Report Page ii

LIST OF CONTENTS

PAGE NO.

LIST OF APPENDICES iii

LIST OF TABLES iii

LIST OF FIGURES iv

LIST OF PLANS iv

1. SUMMARY 1

2. INTRODUCTION 2

3 PREVIOUS WORK 5

4. REGIONAL GEOLOGY 7

5. PROJECT GEOLOGY 10

6. WORK COMPLETED 14

6.1 GEOLOGICAL MAPPING 14

6.2 GEOPHYSICS 16

6.2.1 GROUND IP 21

6.3 DIAMOND DRILLING 24

6.4 TRENCHING 25

7. CONCLUSIONS 26

8. EXPENDITURE AND PROPOSED BUDGET 27

REFERENCES


Oyadao Project - Year 3 Progress Report Page iii

LIST OF APPENDICES

Appendix 1: Diamond Drilling Data

Appendix 2: Diamond Drill Cross Sections

Appendix 2: Trench Sampling Data

LIST OF TABLES

No. Title Page No.

1 List of Landsat Scenes 12

2 Targets derived from Ground IP Survey 21

3 Planned Drilling (testing IP targets) 23

4 Oyadao Year 3 Drilling Program 24

5 Expenditure Year 3 24

6 Proposed Expenditure Year 4- Semester 1 30


Oyadao Project - Year 3 Progress Report Page iv

LIST OF FIGURES

No. Title Page No.

1 Oyadao Project in Cambodia 3

2 Oyadao Project Location Map 4

3 Oyadao Project Exploration Outline 5

4 French 1: 200,000 scale Geology Map 8

5 Project Geology 11

6 Oyadao Project Landsat 1990 Image 13

7 Border Prospect Detailed Gold Panning 15

8 Aeromagnetic Image: Total Magnetic Intensity Reduced to the Pole 17

9 Aeromagnetic Image: First Vertical derivative Reduced to the Pole 18

10 Aeromagnetic Image: Key Features 20

11 Border Prospects showing new IP targets and Year 3 Drilling 22

12 Border Prospect showing 3D IP targets and planned Drilling

llingdrilling

23


Oyadao Project - Year 3 Progress Report Page 1

1. SUMMARY

Year 3 work has included:

• 1,561 metres drilling

• 10km geological traverses

• 12 Trenches

• 14 line km Ground IP

From 2005, Liberty has completed the following work at the Oyadao Project:

• 142 stream sediment samples, • 162 rock chip samples, • 6,478 line kilometres of airborne geophysics, • 14 line kilometres of detailed ground geophysics surveys, • Landsat TM data processing and interpretation , • aerial photograph interpretation, • detailed geological mapping and • 2,091m RC/Diamond drilling (14 holes)

This work has resulted in four prospects being outlined in the border region of the

Oyadao Project; Tawau, Kinabulu, Ranau and Bambangan.



2. INTRODUCTION

This report covers all work completed on the Oyadao Exploration Licence for the third

year ending 4th June 2009.

Liberty commenced exploration in 2005 encouraged by reports of previous exploration

dredging for gold in the San River and winning of gold by the locals in the river bed and

from extensive hard rock workings near the Vietnam border.

In 2006, a grid based soil and rock chip sampling was completed over the workings at

the Border Prospect resulting in significant values of gold and base metals in dump

material and soils, confirming the known workings.

In early 2007 a high resolution airborne magnetics survey was flown covering the

tenement area, less a 5km wide buffer zone. Landsat, digital aerial photography and

publicly available topographic data were acquired and processed. Photomapping was

completed at 1:25,000 scale.

Phase 1 drilling intersected only minor gold in a thin quartz/shear zone but was restricted

by border issues to small workings south of the main road. A second phase of drilling

was completed in 2008. A total of 14 drill holes were completed to test other gold

workings and targets identified by mapping and drainage sampling. Detailed ground

geophysics and trenching was also carried out over the Border Prospects and the

interpretation of results became available after phase 2 drilling had been completed. The

targets generated from this work therefore remain untested.

Five areas with anomalous gold results from stream sampling were identified in the

reconnaissance work. These catchments with significant gold values are yet to be

prospected and sampled.

Exploration of the Border Prospect in the 2008 - 2009 involved detailed mapping of the

reefs/workings, rock chip sampling, drilling, trenching and ground geophysics.

The Oyadao EL covers an area of 347 square km within Ratanakiri Province in far north-

eastern Cambodia bordering Vietnam as shown on Figure 1. The Exploration Licence

was applied for under MOU in early 2006 and converted to an EL on 5th June 2006.

Access from Phnom Penh is by way of the new bitumen road along the eastern side of

the Mekong River to the Stoeng Treng turnoff then easterly by gravel road to the

Vietnam border via Banlung. At present the 500km journey takes about 11 hours driving.

Liberty Mining International Pty Ltd

Oyadao Project - Year 3 Progress Report

Access within the tenement is via a reasonable network of 4WD plantation tracks;

however, there is no vehicular access across the San River to the northern part o

tenement.

Figure 1: Oyadao Project in Cambodia

The area is largely farmed for cashew nuts and rubber on the red basaltic soils covering

the upper plateaux and for rice on the lowlands along the San River flats.

All maps, figures and data files in

projection unless otherwise specified.

iberty Mining International Pty Ltd Confidential Information - unauthorised use prohibited

Year 3 Progress Report


however, there is no vehicular access across the San River to the northern part o

Figure 1: Oyadao Project in Cambodia



All maps, figures and data files in this report use the UTM-WGS84

projection unless otherwise specified.

unauthorised use prohibited

Page 3


however, there is no vehicular access across the San River to the northern part of the



WGS84-zone48-north



Figure 2: Oyadao Project Location Map



Figure 2: Oyadao Project Location Map


Page 4



3. PREVIOUS WORK

Visits to the area and a literature search by consultant Bryan Burke and Liberty

geologist Don Horn in April 2005

application which was converted to an EL in June 2006.

Figure 3: Oyadao Project Exploration Outline



PREVIOUS WORK


April 2005 and December 2005 respectively, resulted in a MOU

application which was converted to an EL in June 2006.



Page 5


respectively, resulted in a MOU




In April 2006 Don Horn's team completed a grid soil (40m x 200m), rock chip sampling

and mapping program to cover the workings at the Border Prospect. The results

contained significant values of gold and base metals but in effect confirmed the gold

reefs that were already known. Rock sampling of dump material gave some very high

gold and base metal values.

In December 2006 a diamond drilling rig was mobilized to the area to test the gold reefs

at the Border prospect. Four short holes were completed below an elongated pit south

of the main road which intersected minor gold in a thin quartz/shear zones. Access to

the main target north of the main road was restricted at this time due to border issues.

In January 2007 a high resolution airborne magnetics survey was flown covering the

tenement area up to a 5km "no-go" buffer zone immediately west of the Vietnam border.

High resolution Landsat data, digital aerial photography and publicly available

topographic data were acquired and processed. A consultant from Australia was

contracted to integrate all of these data. Specifically, this involved the creation of a

geological map at 1:25,000 scale.

Drainage samples were collected over selected parts of the EL at a density of one

sample per square kilometre. The program was designed to test all areas of exposed

bedrock where the drainage was sufficiently well defined and was completed in two

stages; south of the San River in September 2007 and north of the river in March 2008.

Five catchments with significant Au values in the -80 mesh fraction and pan

concentrates have resulted from this work and these will be prospected and sampled in

detail. In this reconnaissance data set, the Border prospect is seen only as a cluster of

weak pan concentrate anomalies but is apparent as a copper anomaly.

A program of detailed exploration of the Border Prospect commenced in January 2008

including detailed mapping of the reefs/workings, detailed rock chip sampling of dumps

and detailed panning of all creeks.

For reporting year 3, all work completed at Oyadao included:

• 4 diamond drill holes (530m)

• detailed mapping and prospecting

• panning of every creek



4. REGIONAL GEOLOGY

Publicly available geology maps include the 1966-1970, 1:200.000 scale series

produced by the French Government (see Figure 4) and a 1:500,000 scale map of

Cambodia produced by the Russian Government in 1991 (see Figure 5) . Apart from the

confusion in regard to the relative ages of rock units in Cambodia, the present mapping

shows a basic agreement with each of these in the Oyadao area.

However, the French mapped the basement rocks (pre-Mesozoic) as Devonian high

grade metamorphics. It is more likely that these are much older and are probably

Cambrian or even Pre-Cambrian age. Also, the present mapping has been able to

differentiate a much younger rhyolite unit, possibly Triassic or Permian age from some

areas shown by the French as Devonian metamorphics.

Also on the French maps is a late Tertiary (Neogene) basalt shown rimming the

Quaternary basalt. This was not located during Liberty mapping in 2007 (see Section 7).

Instead, there is a fairly consistent pavement at the base of the Quaternary basalt that is

an old surface, the laterite deflation surface which will be discussed in the following

sections.

Neither the French or Russian maps provide any structural information, that is, no folds,

faults, bedding trends or dips. They also fail to recognize the ubiquitous dykes of

Eastern Cambodia. Neither are there any Au workings shown on their maps in the

project area.



Figure 4: French 1: 200,000 scale Geology Map


Oyadao Project - Year 3 Progress Report Page 9 Details of prior modern exploration within the concession area are poorly documented.

Probably the only modern exploration was that undertaken by Jupiter International (a

Canadian listed company) in 1996. A number of prospects were looked at by Jupiter

International however the only available report is that prepared for Jupiter by the

Canadian Consulting Geologists and Engineers - Watts, Griffis and McOuat Limited

(Moxham, 1998). Their maps and report are a rehash of the earlier work. The Moxham

report provides a summary of the work undertaken and was again summarized by Brian

Burke (2006) as follows.

Central Mine Area (now designated the Border Prospect):

The main area assessed by Jupiter and Moxham is the area close to the Vietnam border

called the Central Mine area. The gold workings in this area occur along a strike of 2-3

kms and cover an area of about 20km2. The Jupiter and Moxham work only describe a

small number of these workings. Moxham noted (1998) that the area “is heavily

overgrown since it was logged a few years ago and accurate location is difficult in the

thick bush”.

In one area visited by Moxham the prospect “comprises a group of north south

orientated open-cut trenches some 100-150m long, 5-15m wide, water filled but

apparently 10m deep. It is suggested that some 2-3000 tonnes of material has been

removed form this prospect.

Moxham described the entry to the Central Mine area as “massive , medium to coarse

grained white monzonitic biotite granite.” The area to the north were seen to comprise

contorted banded greywacke with quartz planes showing local flexing of the sedimentary

banding. The regional setting was described as being silicified meta-sediments in the

border zones of the granitoid stock.

The mineralisation Moxham reported as hard to interpret but appeared to take the form

of swarms of quartz veins orientated at 1600 to 1800 near vertical, individually 10-15

centimeters wide. The mineralisation comprises quartz, pyrite, pyrrhotite, carbonate and

some magnetite. The wall rocks are heavily chloritised with evidence of shearing.

Moxham reported a summary of the sampling completed by Jupiter however as he noted

in his report there were reservations both regarding the location of the samples and the

assay technique used. For the Central Mine area the following had been completed by

Jupiter:

1. 202 rock samples with up to 16.5 g/t Au.

2. 123 soil samples up to 3 g/t Au.



3. 66 stream sediments reporting up to 2.4 g/t Au.

In his review of proposed exploration Moxham noted that the Central Mine area should

be considered as one 2.5km zone of interest.

Phum Syarung

Moxham described the country rock as falling in two types: chloritised granite which

appeared to intrude highly chloritised and argillized schists. Quartz veining is mainly in

the latter however also occurs in the granite. The granites were described as chloritised

to a grey green colour and that there was evidence of fracturing, faulting and rotation of

the granite blocks indicating a strong shear /fault movement in the area of the camp.

The mineralisation takes the form of gray multi-banded quartz carrying veinlets of pyrite,

arsenopyrite, galena, carbonate and occasionally chalcopyrite. In some pits there is

abundant coarse euhedral galena, blackjack sphalerite and chalcopyrite, often well

carbonatised.

All in all, previous work is of little value except that it gave encouragement for the early

visits by Liberty geologists; the Jupiter exploration has now been superceded by

Liberty's exploration.

5. PROJECT GEOLOGY

The oldest basement rocks are high grade metamorphics, gneisses and amphibolites,

which may be as old as Pre-Cambrian. They form rugged topography throughout the

tenement. Overlying this basement is a well bedded sequence of weakly

metamorphosed rhyolite and felsic to intermediate tuff which dips moderately to the

south and southeast.



Figure 5: Oyadao Project Geology

These rocks may correlate with lower to middle Triassic rhyolite mapped by the French

further to the north and south. Similar but generally horizon

assigned a Jurassic-Cretaceous age on the French maps.

Marginal to and in the floor of the San River is a small batholith of granodiorite which

intrudes both the presumed Pre

Plagioclase, K-feldspar and hornblende and is ubiquitously xenolithic, increasingly so



Figure 5: Oyadao Project Geology


further to the north and south. Similar but generally horizontally dipping rocks have been

Cretaceous age on the French maps.


intrudes both the presumed Pre-Cambrian and Triassic rocks. It is composed of

feldspar and hornblende and is ubiquitously xenolithic, increasingly so


Page 11


tally dipping rocks have been


Cambrian and Triassic rocks. It is composed of

feldspar and hornblende and is ubiquitously xenolithic, increasingly so


Oyadao Project - Year 3 Progress Report Page 12 around its margins. In fact, the marginal zone is quite complex often containing large

rafts of older strata which have been hornfelsed (generally increased silicification). The

granodiorite is a typical I-type intrusion.

The Precambrian, Triassic strata and granodiorite intrusion are cut by numerous,

unmetamorphosed dykes from felsic to mafic in composition. They are generally

holocrystalline and dykes rather than sills. The majority of dykes trend northeast.

At the very base of the Quaternary plateau basalts (see below) is a horizontally dipping,

unmetamorphosed rhyolite which is lateritized. While in outcrop it is lithologically similar

to the Triassic rhyolite it has a distinctive flat lying disposition on aerial photos and is

unmetamorphosed. It is probably of upper Jurassic- lower Cretaceous age.

During the late Cretaceous and early Tertiary the area was lateritized. The process of

deflation and incision of this surface was interrupted by flood basalt extrusion. By the

Quaternary the entire area was covered by flood basalts up to 100 metres thick. These

basalts are now being incised to form the present plateau topography. The San River

system is cutting away at the edges of the basalt plateau exposing the deflated laterite

profile down to almost fresh rock in the base of the river. The youngest unit is

horizontally dipping Quaternary, flood basalt.

A pervasive northwest trending open-spaced cleavage appears to cut the basement

strata but not the dykes. This cleavage is probably axial planar to open folding within the

older basement rocks. There are numerous faults apparent but the major ones mostly

trend east-northeasterly; a major fault controls the west-northwesterly flowing segment

of the San River.

Table 1. Raw Landsat data obtained from the www.Landsat.org website

Run No. Scene No. Description

125 50 1990 Landsat 7

125 50 2002 Landsat 7+ETM

The 1990 vintage Landsat 7 imagery data were processed and produced remarkably

good images (see Figure 6). The primary algorithm used is a 7R-5G-3B merged with

40% 4R-7G-3B then 2 times bicubically resampled.



2002 Landsat ETM data, also processed, are less useful but provide some bedding

trends and faults, which are more clearly defined by the 15m

The primary algorithm used is a pan




are more clearly defined by the 15m-resolution Pan channel.

The primary algorithm used is a pan-sharpened 4R-7G-3B.

Figure 6: Landsat 1990 Image


Page 13


resolution Pan channel.



6. WORK COMPLETED BY LIBERTY YEAR 1 – YEAR 3

Work during the current reporting year has included further mapping, the completion

of 10 drill holes at three of the Border Prospects, further trenching, and ground IP

surveys.

This work has improved geological understanding of the setting and styles of

mineralization. Further work is necessary to assist in the planning of future work

programs and in particular, new drill proposals. Some of the following discussion

includes previously reported work to help explain rationale and the detail for targeting

of Year 3 work programs.

6.1 Geological Mapping

High sulphidation was observed in some parts of Kinabalu and Ranau Lodes. The

sulphidation normally occurs in the highly silificied zone in or near to the contact

between the intrusive granodiorite and surrounding wall rock. Some sulphide

minerals were also observed in quartz floats in Bambangan Lode area. Sulphide

minerals include pyrite, chalcopyrite, galena, sphalerite, bornite and some azurite

(secondary mineral of copper). A lot of quartz fragments were observed along the

road cut in the southeastern part of the Ranau Lode area indicating another zone of

mineralized quartz reef.

Two major faults were found in the Ranau Lode area. The first fault strikes 75

degrees and dips 60 degrees to the southeast. This fault could be one of the

mineralization controls in Ranau Lode as its lies near and almost parallel to the

shafts line. The second fault was found in the northeastern part of Ranau Lode

striking at 85 degrees and dipping 35 degrees to the south. A third fault was a

contact-fault between an intrusive and surrounding wall rock in the Kinabalu Lode

area.

While the workings are clearly related to a structural zone the amount and disposition

of the mineralized quartz is uncertain. The only evidence of quartz reef outcrops

were found in shafts at the western end of the Ranau Lode area and in shafts at

Kinabalu. The exposures are mainly in the form by grey-brown-reddish soft clay with

some quartz veins as well as quartz fragments therefore they could be also

considered as fault zones. Observation in the shafts showed that the quartz reef/fault

zone has a thickness of 30cm and 120cm and striking 100-120 degrees, dip 45-55

degrees to southwest at Ranau and 150cm and 100cm and striking 90-95 degrees,



dip 50 degrees to southwest at Kinabalu. Some shafts in all working area were du

inclined at 45-55 degrees to the south.

Figure 7: Border Prospect Detailed Gold Panning

Panning and prospecting of minor drainage channels throughout the Border Prospect

has been completed with a total of 109 sites panned (

The Border area is a weakly anomalous area in regard to gold in the present drainage

system unless panning is done close to the known workings. However, as can be seen

on Figure 7, most panned samples will show colours, many containing in excess of 10.

There is no indication of significant bedrock gold surrounding the Bambangan lode.

6.2 Geophysics

In January 2007, UTS Geophysics flew a fixed

survey over the Oyadao. The survey was flown at a sensor height of 60m on north

south lines spaced at 100m and tie

altimeter data were collected during the survey. For reasons related to National

Security, a "no-go" buffer zone could not be flown within 5 km of the Vietnamese

border.



dip 50 degrees to southwest at Kinabalu. Some shafts in all working area were du

55 degrees to the south.



has been completed with a total of 109 sites panned (see Figure 7).

area is a weakly anomalous area in regard to gold in the present drainage



ndication of significant bedrock gold surrounding the Bambangan lode.

In January 2007, UTS Geophysics flew a fixed-wing, low level, detailed geophysical

survey over the Oyadao. The survey was flown at a sensor height of 60m on north

ines spaced at 100m and tie-lines spaced at 1,000m. Magnetic and radar


go" buffer zone could not be flown within 5 km of the Vietnamese


Page 15

dip 50 degrees to southwest at Kinabalu. Some shafts in all working area were dug



area is a weakly anomalous area in regard to gold in the present drainage



ndication of significant bedrock gold surrounding the Bambangan lode.

wing, low level, detailed geophysical

survey over the Oyadao. The survey was flown at a sensor height of 60m on north-

lines spaced at 1,000m. Magnetic and radar


go" buffer zone could not be flown within 5 km of the Vietnamese



The data were reprocessed in 2008 by Southern Geoscience. This reinterpretation

of UTS's preliminary plots utilized Reduction to the Pole which considerably

enhanced the usefulness of the data. Figures 8 & 9 show the two plots used

routinely for interpretation.

Figure 8: Aeromagnetic Image: Total Magnetic Intensity Reduced to the



reprocessed in 2008 by Southern Geoscience. This reinterpretation



routinely for interpretation.

ure 8: Aeromagnetic Image: Total Magnetic Intensity Reduced to the

Pole


Page 16

reprocessed in 2008 by Southern Geoscience. This reinterpretation



ure 8: Aeromagnetic Image: Total Magnetic Intensity Reduced to the



Figure 9: Aeromagnetic Image: First Vertical Derivative Reduced to the

Within the aeromagnetic data there are several key features and these have been

incorporated into the geological interpretation. However, much of the area flown is

covered by Quaternary basalt and alluvium and is difficult to interpret.




Pole


geological interpretation. However, much of the area flown is

covered by Quaternary basalt and alluvium and is difficult to interpret.


Page 17



geological interpretation. However, much of the area flown is


Oyadao Project - Year 3 Progress Report Page 18 The data are dominated by a circular area of strong magnetism that may be a gneiss

dome with a granitic centre surrounded by magnetic hornfels. These magnetic units also

run down toward the southwest below basalt cover. There are obviously two sets of

magnetic dykes apparent striking northeast and northwest.

The images, however, probably result largely from magnetic units within the

metamorphic basement and the large number of younger magnetic dykes resulting in a

quite complex, difficult to interpret, pattern.



Figure 10: Oyadao Project Aeromagnetic Image: Key Features





Page 19




6.2.1 Ground IP

Results from drilling in Year 3 (discussed in a 6.3 of this report) at Oyadao indicated the

geometry of mineralisation was more complex than initially suggested from mapping of

artisinal workings and trenching. The completion of the recent IP and ground magnetic

surveys has improved the geological model and developed several new targets for

testing in Year 4.

Seven targets were identified from the IP survey at the Border Prospect. The majority of

these are strong chargeability targets with one target consisting of an overlapping

combination of a small moderate to highly chargeable response within a larger highly

resistive area. All but one of the targets identified are considered to be high priority for

immediate follow-up drill testing (see Table 2. below and Figure 11.)

Table 2: Targets derived from IP Survey (3D Grid Array)

Target Target Summary Easting Northing Depth RL

1 Moderate Chargeability, Larger Resistor 767888 1523770 70 110 2 Strong Chargeability, Large Resistor 767658 1524214 43 130 3 Strong Chargeability 767950 1523488 20.5 129.3 4 Chargeable zone across resistive/conductive boundary 768410 1523410 30 144.7 5 Moderate - Strong Chargeability 768410 1523570 100 70 6 Strong Chargeability, Moderate Resistor 767963 1524219 40 130 7 Strong Chargeability 768210 1523280 0 130



Target #1 being a more diffuse Chargeability response and quite deep, requiring deeper

drilling to effectively test than the other much shallower targets. Should testing of the

other drill targets return favourable results then this will be revised to a higher priority for

testing.

The company plans to immediately test these strong results by using all of the additional

information provided by the ground surveys and recent detailed mapping. To do this,

further drilling is planned to effectively test the Border Prospects’ potential for significant

gold mineralisation. A series of drill holes have been planned using direct manipulation of

the new IP models in 3D (using Discover 3D). These holes are designed to intersect all

Figure 11: Border Prospect showing new IP targets and recently completed

drilling


Oyadao Project - Year 3 Progress Report Page 22 of the targets at optimum angles to ensure the material giving the geophysical response

is intersected.

Holes have been given tentative numbers continuing the current numbering system in

order to specify a logical drill sequence.

Table 3: Planned Drilling (testing IP targets and extensions to mineralisation)

Hole No. East North RL AZI DIP RC (m)

HQ (m)

TD (m)

Target

OY0015RC 768400 1523400 176 25 -60 120 - 120 IP Target #4

OY0016RD 768410 1523640 176 180 -60 100 50 150 IP Target #5 & mineralisation intersected in OY0012RD

OY0017RC 768160 1523275 160 25 -60 100 - 100 IP Target #7

OY0018RC 767975 1523500 162 180 -60 80 - 80 IP Target #3 OY0019RC 767970 1524185 170 360 -60 100 - 100 IP Target #6 OY0020RC 767660 1524180 176 180 -60 100 - 100 IP Target #2

Figure 12: Border Prospect showing 3D IP targets (isosurfaces) and planned drilling. Key: RED Isosurfaces represent chargeable zones(darker =more chargeable); BLUE isosurfaces represent high resistivity zones. Previous drilling

collar labels are GREY, PLANNED holes collar labels are BLACK.


Oyadao Project - Year 3 Progress Report Page 23 It is interpreted that these IP targets represent an excellent probability of intersecting

mineralisation at the Border Prospect. This is highlighted by the fact that gold

mineralisation occurs in zones of moderate to high polymetallic sulphide (>10%) within

artisanal workings at Oyadao.

6.3 DIAMOND DRILLING

A total of 10 drill holes were completed at Oyadao in the reporting year. These consisted

of RC pre-collars and Diamond tails totaling 1,560.9 metres. Drill hole details and

significant results are summarized in the table below:

Table 4. Oyadao – Border Prospect Drill Program Hole No. UTM East UTM North Elev. Dip Azi. Total

Depth Mineralised Intervals

OY0005D 1523438 768496 171 -60 350 38.2 No significant results (abandoned)

OY0006D 1524057 767605 191 -60 350 150.4 No significant results OY0007D 1524122 767932 190 -60 350 150 No significant results OY0008RD 1524161 768132 174 -60 350 170 No significant results OY0009RD 1524201 768327 155 -60 350 172.5 No significant results OY0010RD 1523431 768357 171 -60 350 150.5 3m at 1.44ppm Au from

75m OY0011RD 1523438 768496 171 -60 355 168.1 No significant results OY0012RD 1523555 768485 165 -60 350 170 11.5m at 1.85ppm Au

from 39m OY0013RD 1524110 768140 165 -56 349 201.1 6m at 0.83ppm Au from

90m OY0014RD 1523955 767625 165 -60 350 190.1 3m at 43.3ppm Ag from

147m

Results from 3m composites by 50g fire assay with 0.5 g/t gold lower cut/off, no upper cut applied. Maximum of 3m (single sample) internal waste interval. Samples sent to ALS Chemex.

APPENDIX 1 CONTAINS ALL DRILL ASSAY DATA FOR YEAR 3 AT OYADAO.

APPENDIX 2 CONTAINS CROSS SECTIONS OF THE DRILLING.



6.4 TRENCHING

A total of 12 trenchs were completed AT Oyadao in the reporting year.

193 samples were submitted collected although these samples have not yet been

submitted to the laboratory for assay. A summary of the assays collected are included in

Appendix 3.

7. CONCLUSIONS

Year 3 exploration programs at Oyadao focused on three of the border prospects with

drilling and detailed ground geophysics. The IP results were obtained after drilling had

failed to intersect significant mineralisation in 6 of the 10 holes completed. All work at

Oyadao including and proposed drilling was subsequently suspended pending a

complete review of results. This has identified a number of priority IP targets near the

workings as well as suggested follow-up targets identified in the stream sediment

sampling programs. Budgets have been proposed for this work in Year 4 and are

currently under review. It is expected that work will commence at the Oyadao Project at

the end of the wet season in November/December 2009.



8. EXPENDITURE AND PROPOSED BUDGET

Table 5 lists the total expenditure for Year 3 of tenure.

$US

Salaries and wages $98,000

Administration and General $42,000

Tenements and Properties $17,300

Consulting and Technical Services:

Geological

Geophysical

Drilling

UXO + Earthworks

$91,000

$47,000

$108,000

$27,500

Field work

Assaying

Field supplies, Accommodation,

Meals, Vehicles, Transport, Fuel,

Helicopter

$58,700

$62,500

$140,500

Overheads $62,900

TOTAL US$755,400

Table 4: Oyadao Project Expenditure- Year 3



A two phase work program has been proposed which if approved by the

company will commence at the end of the 2009 wet season. The proposed

work programs for the Oyadao Project (Year 4) are as follows:

PHASE 1

Drill Test mineralised structures (IP Targets)

Oyadao - Regional

• First Pass follow-up of regional stream anomalies � Stream and Ridge traverses (Scout mapping ,sampling)

100 samples � Detailed panning of smaller streams/tributaries to narrow

target area • Define Prospects for stage II follow-up

Oyadao South – Workings (Phum Syarung)

• Grid Auger Soils � 100m x 20m on 1km x 2km grid 2200 samples

• Grid Based Mapping � 50 Rock chips

• Define targets for detailed testing & follow-up � Define appropriate 2nd Stage exploration techniques (IP,

Trenching)

Oyadao South - Regional

• Stream Sediment Sampling – 1km2 composite sampling � -80#, pan concentrate, float sampling (where appropriate)

200 samples



PHASE 2

Oyadao – Regional (1 Prospect)

• Grid Auger Soils � 100m x 20m on 1km x 2km grid 2200 samples

• Grid Based Mapping � 50 Rock chips

• Define targets for detailed testing & follow-up � Define appropriate 2nd Stage exploration techniques (IP,

Trenching)

Oyadao South – Workings (Phum Syarung)

• Detailed Mapping (roughly 20m x 20m) � 100 Rock chips

• Possible Trenching � 300 Rock chip/channel sample

• Ground Geophysics (IP) � Approx. 1.5 x 1.5 km with lines spaced at 200m

• Define targets for drill testing

Oyadao South - Regional

• First Pass follow-up of regional stream anomalies � Stream and Ridge traverses (Scout mapping ,sampling)

100 samples � Detailed panning of smaller streams/tributaries to narrow

target area • Define Prospects for follow-up



Table 5 lists the estimated expenditure for the Phase 1and 2 exploration programs.

$US

Salaries and wages $65,000

Administration and General $40,000

Tenements and Properties $20,000

Consulting and Technical Services:

Geological

Geophysical

Drilling

UXO + Earthworks

$75,000

$25,000

$200,000

$50,000

Field work

Assaying

Field supplies, Accommodation,

Meals, Vehicles, Transport, Fuel,

Helicopter

$80,000

$60,000

$100,000

$25,000

Overheads $35,000

TOTAL US$775,000

Table 5: Oyadao EL Proposed Expenditure for Year 4


Oyadao Project - Year 3 Progress Report Page 29 REFERENCES

Moxham, R.L.- 1998: Review of Jupiter International Resources Mineral properties in

Cambodia; Unpubl. Internal Company Report Watts, Griffis and McQuat Limited

Bourke, B.- 2006: Independent Geologists Report, GAR Mineral Exploration Properties

Ratanakiri Province Kingdom Of Cambodia; Unpubl. Internal Company Report

Horn, D.V.- 2006: LMI Cambodia, Project Assessment and Work Proposals, January

2006; Unpubl. Internal Company Report

Horn, D.V.- 2006: MIME Progress Report Oyadao Project, April 2006; Unpubl. Internal

Company Report

Horn, D.V.- 2006: MIME Progress Report, Oyadao Licence, YEAR 1- Semester 1,

September 2006; Unpubl. Internal Company Report

Dellar, A..- 2007: MIME Progress Report, YEAR 1- Quarter 3, Oyadao Licence, April

2007; Unpubl. Internal Company Report

Cotton, B.J.- 2007: MIME Progress Report, YEAR 1- Semester 2, Oyadao Licence,

July 2007; Unpubl. Internal Company Report

Cotton, B.J.- 2007: Photogeological Mapping at 1:25k scale of the Oyadao Project,

August 2007; Unpubl. Internal Company Report

Cotton, B.J.- 2007: MIME Progress Report, YEAR 2- Quarter 1, Oyadao Project,

October 2007; Unpubl. Internal Company Report

Cotton, B.J.- 2008: MIME Progress Report, YEAR 2- Semester 1, Oyadao Project,

January 2008; Unpubl. Internal Company Report

Documents

LIBERTY MINING INTERNATIONAL PTY LTD OYADAO ......Liberty Mining International Pty Ltd Confidential Information - unauthorised use prohibited Oyadao Project - Year 3 Progress Report