Pacton Gold up 42%, page-6

I agree Paulf & Wack

My reading of the articles/definitions re Alluvial Gold all mention it as 'free gold' – either dust or nuggets that has been freely moved by water.

This indicates to me that gold locked up within rock – that has to be crushed to release it as per the Structural sources & much of the Conglomerate found in the Pilbara todate – does not fit the common definition of alluvial gold.

So to me it would appear that there needs to be very clear clarification of this issue for DEG's future JV arrangements and for people wishing to invest in these companies.

For example under DEG's JV agreements with FarnoMac (now Novo) & VanMaris, both vendors retain the Alluvial rights but what about any gold found locked up in Conglomerate rock which by definition is not Alluvial.

This could lead to the unworkable situation between JV partners where an excavated trench on these likely Conglomerate tenements would/could have both Nuggets (Alluvial gold) and Conglomerate (non Alluvial) gold.

Under the JV agreement the Vendors would clearly get all the Nuggets but would DEG, under its 75% (FM) & 80% (VM) earn-in agreements be entitled to its relevant share in any gold that was not in Nugget form.

DEG clearly has Structural Gold entitlements in these tenements but I would suggest they should equally have an entitlement to all the other 'non Alluvial' gold ie the gold physically locked up in the Conglomerate.

A good discussion to have - if DEG is entitled to the 'non Alluvial' gold it could be a nice bonus.

Ark