Annual report on EL 10321 December 2006 to December 2007

Abstract

EL 10321 was granted to Agricola Gold Ltd., in December 2002 and is due to expire in April 2008. This report covers activities conducted on and for the tenement from January 2007 to December 2007. Agricola Limited who have entered into a Joint Venture Agreement with Salisbury Resources Limited (SBY) who will be operators. Three prospects have been located within EL 10321, namely Reid, Fisher and Cook. Reid, the northern-most prospect, is located to the east of the Shoobridge Fault. An outcrop of gossanous quartz-vein breccia approximately 15 m wide occurs as a discontinuous unit over some 300 m trending north-south as 5 main elongated pods. Anomalous gold values occur within the brecciated zone along with anomalous lead and arsenic values. Previous shallow drilling (36 holes drilled to 3m depth each on lines 10m apart) produced gold grades ranging from 1 - 3 g/t with lead values up to 3%. This prospect has not been tested at depth or along strike. The central prospect is designated the Fisher prospect. Three rock-chip samples returned values from 1.1 - 2.1 g/t. Morestoe Pty Ltd sampled the northern end if the prospect where samples returned values averaging 1.9 g/t over continuous 0.5m wide quartz veins. At the southern end of the hill the outcropping quartz veins coalesce with values up to 3.2 g/t gold, more work is required on this prospect. At the southern end of the tenement the Cook prospect revealed scattered gold occurrences trending into the adjoining Exploration Licence. A geological sketch plan, together with a soil sampling plan, is attached to this report. Surface samples collected near the southern boundary produced results up to 20.1 g/t gold. The prospect requires significant drilling to determine the extent and grade of the mineralisation. The licence area was originally explored by WMC Ltd in the late 1980's as part of their regional exploration program in conjunction with mining at the nearby Goodall Mine. Previous work involved B horizon soil sampling on 20m intervals on lines separated 800m apart. Closer spread sampling on 200m line spacing was undertaken where anomalous point highs had been encountered. WMC followed up the discovery of the Reid prospect with a short IP survey, 8 shallow costeans and 6 drill holes. The best value was 12 m at 2.9 g/t gold. Morestoe Pty Ltd completed 36 shallow drill holes each to 3m depth on hole spacing of 2m with line spacing of 10m apart on the southern lens and a total of 50 holes on the northern lens. Further drilling is required to define a JORC compliant resource. Lack of exploration funds restricted field activities during the year, Agricola spent considerable time and effort trying to attract a Joint Venture partner and has been successful in negotiating a Joint Venture with Salisbury Resources Limited in November 2007. Salisbury plan to undertake a major Reverse Circulation drilling program in 2008.