Background

Leyshon Resources Limited (AIM & ASX:LRL) was on the ground in 2003 when China opened its gold sector to foreign investment and is developing the Zheng Guang gold zinc project as one of the first Sino Foreign owned gold mines in the mineral rich province of Heilongjiang, north east China.

The joint venture has established a 135 km² strategic ground position on a major unexplored gold and copper belt and has delineated an initial JORC compliant Measured and Indicated resource of 740,000 ounces gold, 2.7 million ounces silver and 71,000 tonnes zinc.

A ground breaking ceremony on 2nd August 2008 saw commencement of civil engineering, site clearing and bulk earthworks works at the mine site. Work completed included an 8.6 kilometre access road that connects the project with the residential town of Heibaoshan and the national rail network. In addition the necessary approvals and land compensation arrangements were put in place for the 16 kilometre 35 kv power line which will connect the project to the state grid.

An engineering design by the Changchun Design Institute for the proposed 1.5 million tonne per annum operation is currently being reviewed by international mining consultants Minarco-Mineconsult with a view to reducing the upfront capital requirements and optimising the pit design and operating parameters.

The project has received its formal Environmental approval, the necessary Land acquisition agreements have been finalised and the Project Registration documentation lodged. The final Mining Licence approval is currently being prepared and is expected to be lodged shortly.

The Company is fully engaged in China with its main operating office in Beijing and is jointly developing the project with the Qiqiha’er Brigade of the Heilongjiang BGMR, one of the largest geological bureaus in China.