During the fourth quarterly reporting period (second quarter 1997) work comprising field-based exploration activities within the KP were undertaken.

Fieldwork undertaken up to the end of the first quarter 1997 had reconfirmed the potential of the areas of quartz veining that had previously been identified by Antam. In addition to detailed work undertaken in the vacinity of these veins, additional exploration has highlighted areas to the east that contain widespread silicification and occasional outcropping quartz veining up to 3.5 meters wide. Activities undertaken included detailed 1:2,500 scale mapping, rock chip and float sampling, detailed soil auger sampling and channel sampling to give more definition to anomalous areas.

Results for the soil auger additional rock and float and channel sampling were received during the period, and furthur highlighted the potential of the Cibadak/Tutugan area as a site for hosting a low sulphidation style epithermal quartz vein system that may contain zones of economic mineralisation.

A scout man portable diamond drilling programme was initiated at the start of the quarter to furthur define the known quartz veins in the Tutugan area, and to test for zones of economic mineralisation, this programme is still underway.

Exploration expenditure incurred during the second quarterly period 1997 associated with the project exploration activities amounts to US$302,221 (A$392,887), giving a total date spent on the project of US$638,898 (A$823,833), (US$1 = A$1.28 up to end of March '97, then at A$1.30).