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St George Mining and BHP Billiton forge ahead with exploration in the Eastern Goldfields

St George Mining (ASX: SGQ) has completed a detailed airborne magnetic survey at the East Laverton Property in the north eastern Goldfields, while the company’s multi-phase exploration program continues.

BHP Billiton (ASX: BHP) is sole funding the East Laverton project to a Bankable Feasibility Study through a farm-in agreement.

The 2011 multi-phase exploration program is targeted on high priority gold prospects at the property, which covers more than 1800 square kilometres.

Data from an airborne survey over the Balmoral and Red Dragon gold prospects is being processed and modelled, to supplement the existing geological database.

Information from the survey will help the company develop new drill targets for the 2012 field season.

Meanwhile, drilling is continuing to test the more advanced gold prospects at the Desert Dragon and Balmoral gold prospects.

A total of 873 metres of air-core drilling and 851 metres of reverse circulation drilling have been completed at the prospects to date, with drill samples being submitted for assay.

At Desert Dragon, reverse circulation drilling has intersected significant lengths of altered intervals with disseminated sulphide mineralisation.

Initial air core drilling was only able to achieve depths of 70 metres, less than the minimum 100 metres target depth.

However, assay results from these holes showed that both the alteration and lower level gold response were encouraging, and the reverse circulation drill rig was brought in for further drilling.

Assay results from the reverse circulation drilling are pending.

St George also plans to expand on MMI multi-element soil sampling, which has identified an area of anomalous gold in the newly acquired Golden Dragon area, north of Red Dragon.

BHP farm-in agreement

On May 16 St George satisfied the remaining condition precedent under the Project Dragon farm-in agreement with BHP Billiton for the nickel rights attaching to tenements located at its 100% owned East Laverton Property.

Under the agreement, BHP Billiton will have the right to earn a 70% interest in the nickel rights at East Laverton by sole funding a Bankable Feasibility Study (NYSE:BFS), with St George retaining a 30% stake.