On behalf of the Directors of Southern Gold Limited, I have pleasure in presenting to you, the Company's 2010 annual report.
Junior Explorer Equity Market Conditions
Equity markets showed a recovery of 13% for the year ended 30th June, 2010
but the higher risk exploration and small cap equities were well below these recovery
percentages.
In the world economy, there remain concerns that the recovery may stall, caused by European Government austerity measures, China slowdown and weak consumer demand.
On the positive side, this uncertainty has pushed the price of gold to beyond US$1200/oz.
On the negative side, companies purely focusing on exploration have had a small recovery in share prices relative to mineral producers.
Exploration Focus
Your management team responded to these tough trading conditions by keeping
costs within budget. Exploration expenditure was targeted to gain maximum value
on our tenements.
The focus during the past 12 months has been:
· Increase spending on the Bulong project area in Western Australia to determine the high potential of gold deposits of mineable grade and to increase the near-term value of tenements.
· Continue drilling and soil sampling in Cambodia to enable assessment of project areas where increased focus is desired by ourselves or in joint venture (JV) with our partner, the Japanese Government-backed JOGMEC.
· Earn 51% of the JV with Dominion Mining Ltd on tenements neighbouring the million ounce Challenger gold mine in South Australia.
· Prepare and lodge an application for a $7 million grant from the Australian Government Geothermal Drilling Program.
GREG BOULTON AM
CHAIRMAN
Please download the PDF to read the full Report.
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