New Guinea Gold Corporation

NEW GUINEA GOLD CORPORATION (NGG)

RECENT EXPLORATION AND RESULTS

Trench sampling was completed at Mt Penck
Results from an initial bulldozer trenching program at Simuku became available.
A bulldozer trenching program was in progress at Mt Nakru.
Results from a trenching and geochemical sampling program at Bismarck became available
A trenching and geochemical sampling program was completed at Allemata.
Results from two diamond core holes at Weioko, Sehulea property, became available.
Drilling is in progress at the Imwauna Prospect, Normanby property.
Development commenced at Sinivit Mine Project.

Sinivit Gold Project (92% NGG)

Development commenced at the Sinivit Mine Project. Initial work includes preparation of mine access roads and rehabilitation and extension of the existing camp. Gold production is planned for the third quarter 2005.

Mt Penck Gold Property (60% NGG)

The results of an initial seven hole, 1,000 metre drill program at the Kavola East Prospect, Mt Penck property, Papua New Guinea was reported in the September management discussion, (see Press Release dated 12th October 2004). Results included 72m @ 1.79g/t gold and 12.9g/t silver (including 43m @ 2.35g/t gold), 2m @ 36.7g/t gold, 14m @ 2.82g/t gold, 2m at 15.35g/t gold, 10m of 1.99g/t gold, 6m at 3.67g/t gold, 13m @ 3.06g/t gold, and 3m of 4.7g/t gold.

The above intersections at Kavola East Prospect were within wide intervals of low grade gold such as 49m of 0.23g/t gold and 34m of 0.79g/t gold and almost the entire 1,000m of core contained anomalous gold in the range of 50 to 200ppb gold.

The holes were drilled over a length of 250m of the mineralised system along the presumed Kavola East structure. Five holes were drilled in a south easterly direction and two holes in a south westerly direction. Mineralisation occurred at varying depths in the holes from surface to 160m downhole. During the drilling program several bulldozer trenches across the mineralised zone were completed. These trenches and other drill access roads were channel sampled during the quarter and confirmed wide intervals of gold mineralisation at surface such as:

20m of 4.73g/t gold; 18m of 7.72g/t gold including 3m of 42.8g/t gold and 90.3g/t silver; 18m of 3.79g/t gold including 2m of 40.4g/t gold and 48.8g/t silver.

The drill and trench results suggest that several structures exist at Kavola East Prospect which contain high grade gold, 20 to 40g/t, over widths of up to 3 metres. Lower grade gold mineralisation of up to 5g/t gold has penetrated and permeated structurally prepared and permeable volcanic units laterally from the structures for up to 50 - 60 metres, with trace gold (0.1g/t) penetrating several hundred metres from the structures. The initial drilling did not close off the Kavola East mineralisation and further drilling will be carried out in 2005 to test for extensions.

In addition to Kavola East, there are at least six named prospects within a few kilometres of each other at Mt Penck. Prior diamond drilling on one of these prospects intersected 33m of 2.41g/t gold including 12m of 5.05g/t gold. It is expected that these prospects, when trenched and drilled in 2005, will also add to the initial resource expected in January 2005. The Mt Penck property is beneficially owned 60% by New Guinea Gold Corporation and 40% by Vangold Resources Ltd.

Normanby Gold Property (100% NGG)

Drilling by New Guinea Gold Corporation (NGG), at the Imwauna Prospect, Normanby Property, Papua New Guinea has returned excellent gold assay results. NGG owns 100% of the Normanby property.

Complete results are shown in the Press Release dated 3rd February 2005. Detailed drilling has been completed to date on only 175m of the trenched 1240m strike length of the system and will continue for several months.

The present drilling extends the wide spaced drilling (18 holes) at Imwauna in 1996 which had best results such as:

NGG's business plan envisages the development of three gold mines over the next three years. Sinivit Mine is expected to be producing gold at the rate of 40,000oz gold/year by later in 2005. The Imwauna Prospect is planned as a second mine to commence production late in 2006. In addition NGG has interests in 10 further gold, gold/copper and molybdenum/copper properties in Papua New Guinea, most of which already have significant drill hole intersections. Work is proceeding to define resources on these properties.

The Imwauna Vein Swarm is a zone of epithermal quartz/gold veins, with some interspersed, disseminated gold mineralisation that occurs within a northerly trending structural zone which varies from 500 to 1000m in width and has a defined strike length of approximately 3,500m. The potentially gold bearing area is outlined by both gold in soils and mapped gold bearing quartz veins. For more information on the possible total size of the system see project descriptions and presentation at www.newguineagold.ca. At the northern end of the property, at the Knob Prospect, gold occurs in disseminations in volcanics with trench results such as 320m @ 0.5g/t gold.

The previous and present drilling programs will test less than 20% of the potential gold bearing area and the total gold potential of this system is regarded as very large.

In 1996 NGG reported an inferred resource at Imwauna of 990,000t @ 6.1g/t gold and 12g/t silver (News Release, 31 October 1996). This resource was based on 17 drill holes over a strike length of 950m (strike length now known to exceed 1240m). Although this resource is JORC code and Australian Stock Exchange compliant, it was calculated prior to existing N.I. 43-101 requirements. This resource is thus dated, does not meet the requirements of N.I. 43-101, and should be considered to be exploration information only.

NGG reactivated exploration at Imwauna in 2002, initially on a low key basis. A trial mining operation was completed which yielded geotechnical information for a possible open pit mining operation, a large (approximately 100t) bulk sample to check near surface gold grades and provided samples for metallurgical testing. The bulk sample averaged 14.1g/t gold over a 2.2m mined width, comparable with results from small surface samples and adjacent drill hole results.

Subsequently 2040kg of bulk samples were collected from 38 excavator trenches and outcrops over a 1240m strike length of the Imwauna vein system. These bulk samples indicated that, over an average 1m width (for the entire 1240m strike length), the high grade central core of the trenched zone, the average gold content was 26.4g/t. This bulk sampling did not test for lower grade hanging/footwall or intervein gold mineralisation.

NGG's business plan (see web site) proposes that a gold mine be developed at Imwauna in 2006, subject to completion of a satisfactory feasibility study, and receipt of government approvals. As a part of this feasibility, and to allow an updated resource to be calculated, a comprehensive diamond core drilling program commenced in October 2004. In addition, this drilling will test depth and lateral extensions of the gold mineralisation and previously untested parts of the system.

The initial 17 holes of the present program completed to early December 2004, have confirmed that the high gold grades in the trenches consistently extend to depth. The gold is not significantly enriched at surface. Some holes intersected several zones of mineralisation, and several holes failed to intersect the target zone, probably due to offset faulting or inadvertent early hole termination. Drilling was suspended over the Christmas period but resumed on the 28th January 2005.

An initial analysis of the drilling results, which should be treated with caution until drilling is completed over the entire Imwauna system, suggests that the open pittable, mineable mineralisation, at a 1g/t cut off, averages 6.02g/t gold over a possible mining width of 3.55m. This grade is comparable to the 6.1g/t gold grade of the inferred resource quoted above but the width is significantly wider than the average width of 2.5m in the resource calculation. If a 5g/t gold cut off is assumed, the average grade rises to 15.53g/t over an average width of 1.5m. This grade would be an attractive underground mining grade after the open pit has been depleted.

Sehulea Gold Property (100% NGG)

Two drill holes to test for a northwestern extension of gold mineralisation at the Weioko Prospect, Sehulea Property, Papua New Guinea intersected gold grades of up to 23.5g/t, within a 14m intersection of 4.56g/t gold.
The Weioko Prospect is owned 100% by New Guinea Gold Corporation and has an inferred resource of 84,000 oz gold equivalent, or 1.7 million tonnes at 1.36g/t gold and 12.3g/t silver. Subject to the completion of additional drilling, and a feasibility study, this prospect is scheduled for development in 2006/2007.

Previous trench results at the northern end of the prospect have given high grade gold results at surface such as 16m of 20.3g/t gold, suggesting that high grade structures occur within the overall, lower grade, bulk mineable gold resource.
Two short drill holes targeted this concept and were successful in intersecting significantly higher gold grades than the resource average grade. Hole WEH 031, total depth of 64.8m, intersected 21m of 3.59g/t gold, from a shallow depth of 7m to 28m downhole. Within this intersection a high grade structure containing 4m of 11.55g/t gold, including 1m of 23.5g/t gold was encountered.

Hole WEH 30 intersected more typical Weioko grades including a 51m intersection from 3m below surface to 54m downhole of 1.33g/t gold. This intersection contained several higher grade intervals including 6m at 2.44g/t gold, and 4m at 3.68g/t gold (with a high value of 6.81g/t gold).

These results are very encouraging and, with further drilling in 2005, should lead to an upgrading of the resource for this prospect. In addition the southern and depth extent of mineralisation have not yet been closed off.

Several other prospects with significant gold at surface occur within a few kilometres of Weioko and have yet to be drilled.

Allemata Gold Property (50% NGG)

An excavator trenching/geochemical program commenced at Allemata in October. Earlier field work at the Allemata Property resulted in the definition of high grade gold in trench such as a 4m width of 100g/t gold and wide zones of anomalous gold in soils (200m wide zone of 1.24g/t gold including a 50m wide zone of 4.54g/t gold). The results were described in detail in a recent press release dated 10th June 2004.

The partners (NGG & Vangold) regard the results from the Allemata Property as very exciting and the property is a high priority for drill testing. The surface field work to date has covered only parts of the Uloulo and Mt Haluba Prospects. The present program will complete the soil sampling programs and will test gold anomalous areas with excavator trenching. Drilling will be planned on receipt of these results (expected in December/January), and subject to drill availability, will commence in February 2005.

Simuku Copper/Molybdenum Property (NGG - 90%)

The Simuku porphyry is a very large copper/molybdenum porphyry system in West New Britain Province, Papua New Guinea. Access and logistics are good. The Simuku property is owned 90% by New Guinea Gold and detailed descriptions, including independent geological report, are available at www.newguineagold.ca

Exploration is underway to define high grade components, both copper and molybdenum, of the system which would allow commencement of a copper/ molybdenum mining operation. Substantial bulldozer trenching has been completed and further trenching is scheduled to commence in February, prior to drill testing in the second quarter of 2005. Two long trenches, totaling 3400m in length were completed.

Trench 1, of total length 1670m, traversed the central/southern part of the porphyry copper system (see Press Release dated 29th October 2003 for additional detail of Simuku). The mineralogy of the copper and molybdenum mineralisation (substantial jarosite and hematite alteration) over much of the trench suggests significant leaching of copper minerals from the surface environment which could lead to the formation of a subsurface enriched copper zone.

Significant copper and molybdenum occurs over most of the trenched area with results such as 165m of 0.184% copper and 25ppm molybdenum, 30m of 0.223% copper, 72m of 0.073% copper and 241ppm molybdenum, 24m of 0.34% copper and 37ppm molybdenum. The 72m length of 241ppm molybdenum is regarded as particularly significant and re-assaying of part of this zone by the XRF method suggests that the molybdenum results above are understated by between 5 and 25%.

Trench 2 results are considered excellent for surface samples, particularly in view of the current geological interpretation of the prospect that there has been substantial leaching of copper minerals from the surface environment. We would expect substantially higher grades at depth within a secondary enriched chalcocite (copper) "blanket". NGG believes that potential exists to define two styles of mineralisation at Simuku.

Trench 2 (for location see web site) tested the southern part of a high value copper in soil anomaly (for details see Press Release dated 29 October 2003). This trench contained significant copper over a 1700m length and is still open to the east. This wide zone averaged 0.08% Cu and contained the following higher grade intersections.

Trench 2 Simuku mineralised intervals summary

The highest grade part of the copper in soil anomaly is to the south of Trench 2, and will be trenched in February 2005.

NGG has acquired an excavator and bulldozer specifically for the Simuku project and will recommence the intensive trenching program early in 2005.

The Simuku porphyry copper/molybdenum system, is at least 4.5kms long and between 500m and 800m wide. Prior to 1997, 12 drill holes totalling 1482m and approximately 4.5 km of trenching were completed, all in the northern quarter of the system (see enclosed figure). Results are shown on NGG's web site at www.newguineagold.ca. These results showed extensive primary copper mineralisation of the order of 0.35% with higher grade zones greater than 0.5% copper. Best trench results were 33m of 0.63% copper, 0.2g/t gold and 77ppm molybdenum; 48m 0.68% copper, 0.12g/t gold and 691ppm molybdenum.

The system is still open to the north and south.

Bismarck Gold Property (50% NGG)

A hand trenching program at the Awale Prospect, Bismarck Property, Papua New Guinea returned wide intervals of gold mineralisation such as 112m @ 0.46g/t gold with narrower higher grade intervals such as 4m @ 2.10g/t gold, 4m @ 1.26g/t gold and 16m @ 1.14g/t gold. In addition rock samples collected from creek drainages contained up to 13.85g/t gold. Complete results are shown at www.newguineagold.ca

The Awale Prospect had widespread gold in soil of approximately the same tenor as the trench results. Senior geological staff will visit the prospect in the near future to assess whether or not the gold in the trenches may be leached, i.e. depleted from the surface zone. If the gold is depleted, we could expect better grades could be expected at depth.

There are numerous other prospects within the Bismarck Property such as Tekim and Semben. At Semben previous trench results gave 3m of 156g/t gold, 4.5m of 23.5g/t gold and 2m of 17.0g/t gold. At Tekim trenching returned 26m of 6.99g/t gold and 25m of 4.83g/t gold. These prospects will be assessed during 2005.
Pannable gold was traced to a large (50m x 50m) oxidised breccia outcrop. This was mapped and sampled in detail. Fine alluvial gold is present in virtually all creeks draining the area covered by trenches.

The Bismarck Property is held by Kanon Resources Ltd, a Papua New Guinea company, owned 50% by New Guinea Gold Corporation and 50% by Vangold Resources Ltd.

Feni Gold Property (Vangold earning 75% interest)

No work was completed on the Feni Property during the quarter.

Mt Nakru Copper Property (Effective 75% NGG)

No results have yet been received from the bulldozer trenching program at present in progress.

Yup River Gold Property (NGG 50%)

An assessment program of the Yup River property commenced in February 2005.

The Yup River property (378.5 sq kms) covers the historic Amanab goldfield in North West Papua New Guinea. There are at least 10 separate and defined areas of gold mineralisation within the property. NGG and Vangold have not targeted this property for field evaluation in 2004 due to a lack of suitable exploration personnel and although the probability of Yup River yielding a major gold resource is considered excellent, there are, as yet no defined drill targets. The present program, which commences on 3rd February 2005, should lead to drilling targets later in 2005.

NGG and Vangold have compiled and assessed all previous exploration data. The main points are as follows:

The data assessment by NGG and Vangold has been summarised by independent qualified person, Peter Swiridiuk, as quoted below.

His report and the figures referred to below can be accessed at www.newguineagold.ca

"Historical stream samples compiled and digitized by Terra Search for a World Bank program in Papua New Guinea were statistically analysed and interpreted for gold. A total of thirteen stream sediment drainage anomalies (>0.1g/t gold) were outlined (Figure 3).

The Amanab stream anomalies are divided into four coherent zones draining off specific topography and include Amanab, Aurump, Wofneri and Oweniak. Stream sediment results up to 106g/t gold at Aurump and numerous results greater than 1.0g/t gold define these anomalies. Pan concentrate results to 58g/t gold occur at Wofneri, with greater than 8g/t gold within the Aurump and Amanab stream anomalies.
A compilation and analysis of historical data has included the analysis of soil sampling completed at the Oweniak Prospect by Carpenter Pacific Resources N.L. (Figure 4). Some anomalous soil gold values above 0.1g/t gold are evident.

Three stream anomalies at Biaka occur as coherent zones draining from specific topography (Figure 3) -Stream -80# results include 91g/t gold at Biaka "A", 42.7g/t gold at Biaka "B" and 184 g/t gold at Biaka "C".
Anomalous rock chip results of 2.85 and 1.38g/t gold were recorded from completely weathered schist in this area.

The Yumor anomaly is located in the northern part of the tenement near the village Yumor No2. The anomaly was defined from reconnaissance stream sediment results of 4.7 and 7.5g/t gold during the 1988 Carpenter Pacific Resources N.L. exploration program. Carpenter reported that gold is shedding from an east-northeast trending ridge north of the villages of Akraminag and Yumor No.2 and is persistent over six kilometres. The Akraminag stream anomaly is defined by a 3.39g/t gold stream sediment sample.

The Mouri stream sediment anomaly, 5km east of Oweniak (Figure 3,) is defined by both -80# stream sediment samples (3.09g/t gold) and panned concentrate samples anomalous up to 13.68g/t gold. Other lower value stream anomalies have been defined near the villages of Merewe, Luri and Kambriap."

Airborne magnetic and radiometrics images have been re-compiled with ER Mapper imagery software and an evaluation of this data will be completed by consultant Peter Swiridiuk.

NEW GUINEA GOLD CORPORATION

SUMMARY OF EXPLORATION AND DEVELOPMENT FOR YEAR ENDING DECEMBER 31ST 2004 WITH SUBSEQUENT EVENTS TO APRIL 2005.

New Guinea Gold has had a very active development/exploration program in Papua New Guinea in 2004, both in its own right and in joint venture with Vangold Resources Ltd, Triple Plate Junction Plc and Celtic Minerals Ltd.

NGG's DEVELOPMENT STRATEGY IN PAPUA NEW GUINEA

The Company has interests in twelve properties in Papua New Guinea (PNG). The Company's strategy, based on present resources of approximately 500,000 ozs of gold, is to develop a minimum of three mines over the next three years. These mines should yield an initial production of 40,000 ozs gold per annum and a net cash flow of $10 million per annum with both production and cash flow increasing in later years. At the same time, exploration will proceed on these projects, and remaining projects, to define additional and new resources and new potential mines, such as at Mt Penck and Allemata properties. The initial mine at Sinivit is planned to be in production in early 2006. Further mines may result from the definition of additional resources.

It is most important to note that none of the proposed mine projects have been fully explored. Exploration was terminated in 1998/1999 due to market conditions and reduced funds available to the Company and its parent company Macmin Silver Ltd. All three initial mine projects could yield much larger and longer life mines than are presently proposed. The resources defined to date, and considered for mining, come from relatively small parts of large mineralised systems.

The remaining properties (including two major copper and copper molybdenum systems, see Press Release dated 24th February 2005) in which NGG has an interest, are all significant projects with major orebody potential as determined by extensive exploration completed to date. Two properties, which have geological similarities to Lihir and Porgera, Feni and Crater Mt respectively, have been joint ventured to third parties who are sole funding exploration. NGG considered joint venturing appropriate for the projects, (retaining a 25% equity ), even though they have significant gold in drill holes and potential in excess of five million contained ozs of gold, because both projects require multi-million dollar expenditures to proceed them to the next phase of evaluation.

OVERALL PERFORMANCE

The Company operates in Papua New Guinea through its wholly owned subsidiary Macmin (PNG) Limited (a PNG private company).

The Company's cost of administration are relatively unchanged from the 2003 period, however they are considerably reduced from the first quarter of 2004 during which time the Kanon acquisition and joint ventures were negotiated. The Company raised $1,155,929 during the twelve month period ended December 31st 2004 from the exercise of warrants. In October 2004 the Company raised gross $4,806,000 by way of two private placements; one brokered by Canaccord Capital Corporation for 10,480 units and one unbrokered for 200,000 units. Both placements were completed at $0.45 per unit. Proceeds raised will allow development to commence at the Sinivit gold property, for further drilling at the Normanby property and general exploration expenses.

The company had a very active exploration/development program during 2004.

In regard to mine development and gold production at the Sinivit Gold Project, it has been anticipated that mine construction would have commenced early in 2005 with production in the third quarter of 2005. Delay in receiving final approvals to proceed from the PNG Departments of Mines and Environment have in turn delayed commencement of mine construction. Final Government approvals are now expected in May/June 2005 with gold production in the first quarter of 2006. In the interim period camp and road access upgrade has commenced.

Sinivit Gold Project (92% NGG)

A positive revision of the feasibility study for the Sinivit gold project, (in which the company has an effective 92.5% interest) was completed in May 2004. This is the first stage in a three stage mine development program in Papua New Guinea (PNG).

The revised feasibility study supports the immediate development of the Sinivit Gold Mine. An external feasibility was completed in the late 1990's but because of market conditions (lower gold prices), the project did not proceed at that time. The revised feasibility differs from the original feasibility in two main areas: recovery of gold will be from VAT leaching instead of CIP, and the known reserves will be mined over a 15 month period (processing will take 24 months) instead of 3 years. These changes substantially increase the return on the project and thus its viability.

The revised metallurgical testing was carried out in house and by consultants Ammtec Limited. This testing showed that column leach tests gave gold recoveries of 88%. The revised mine plan was completed by consultant mining engineer, Colin Wregg.

The main conclusions of the feasibility itself in respect to the project are as follows:

Part of the cash flow will be used to upgrade inferred oxide gold resources at Sinivit to reserves or for drilling which is expected to substantially increase the life of the mine. The cash flow will also be used to advance the Imwauna Project (Normanby Property) which the company hopes will be its second mine.

In addition to the oxide resources, the Sinivit Project has a resource of telluride/gold mineralisation plus excellent potential to substantially increase that resource. Studies will be carried out to determine how this additional resource can be economically developed.

New Guinea Gold intends to remain debt free to reduce risk, and hedge free so that the company can benefit from likely future increases in the gold price.

Mt Penck Gold Property (60% NGG)

The results of an initial seven hole, 1,000 metre drill program at the Kavola East Prospect, Mt Penck property, Papua New Guinea was reported in the September management discussion, (see Press Release dated 12th October 2004). Results included 72m @ 1.79g/t gold and 12.9g/t silver (including 43m @ 2.35g/t gold), 2m @ 36.7g/t gold, 14m @ 2.82g/t gold, 2m at 15.35g/t gold, 10m of 1.99g/t gold, 6m at 3.67g/t gold, 13m @ 3.06g/t gold, and 3m of 4.7g/t gold.

The Mt Penck property is beneficially owned 60% by New Guinea Gold Corporation and 40% by Vangold Resources Ltd.

The above intersections at Kavola East Prospect were within wide intervals of low grade gold such as 49m of 0.23g/t gold and 34m of 0.79g/t gold and almost the entire 1,000m of core contained anomalous gold in the range of 50 to 200ppb gold.

The holes were drilled over a length of 250m of the mineralised system along the presumed Kavola East structure. Five holes were drilled in a south easterly direction and two holes in a south westerly direction. Mineralisation occurred at varying depths in the holes from surface to 160m downhole.

During the drilling program several bulldozer trenches across the mineralised zone were completed. These trenches and other drill access roads were channel sampled during the quarter and confirmed wide intervals of gold mineralisation at surface such as:

20m of 4.73g/t gold; 18m of 7.72g/t gold including 3m of 42.8g/t gold and 90.3g/t silver; 18m of 3.79g/t gold including 2m of 40.4g/t gold and 48.8g/t silver.

The drill and trench results suggest that several structures exist at Kavola East prospect which contain high grade gold, 20 to 40g/t, over widths of up to 3 metres. Lower grade gold mineralisation of up to 5g/t gold has penetrated and permeated structurally prepared and permeable volcanic units laterally from the structures for up to 50 to 60 metres, with trace gold (0.1g/t) penetrating several hundred metres from the structures.

The initial drilling did not close off the Kavola East mineralisation and further drilling will be carried out in 2005 to test for extensions.The initial inferred resource at the Kavola East prospect at Mt Penck property, Papua New Guinea (PNG) is 1,500,000 tonnes at 2.9g/t gold for 140,000 ozs of contained gold.

The resource at Kavola East is expected to increase in size with further exploration drilling later in 2005. Kavola East is a small part of the Mt Penck mineralised system and the partners believe, with further exploration, that resources will be defined at other prospects as well as Kavola East (see District Potential below).

The average "discovery cost" of resources at Mt Penck is, to date, a very low, approximately CAD$4 ounce of gold.

The main points in respect to the initial resource are as follows:

District Potential

The Kavola East prospect is one of six named prospects that occur within a northerly trending structural zone on the northwest flank of Mt Penck (see Press Release dated December 17th 2003). Mt Penck is an extinct, partly eroded, Pliocene strata volcano.

The northerly trending structural zone contains linear zones of gold mineralisation. This mineralisation appears to have both sub-vertical control in structures and sub-horizontal control within favourable volcanic units. Mineralisation occurs within zones of argillic/quartz alteration that individually vary from 200 to 800m in length and 15 to 100m in width. Kavola East is one such alteration zone.

The Kavola East prospect is thus only a small part of the Mt Penck mineralised system. The potential to define additional resources at Kavola East and elsewhere in the 101sq km exploration licence is regarded by the partners as excellent. For example, at the Koibua prospect, approximately 1km northwest of Kavola East, previous drilling by earlier explorers gave results such as 33m @ 2.41g/t gold (inc. 12m @ 5.05g/t gold); 10m @ 2.37g/t gold, and 14m @ 3.31g/t gold. Other prospects have had very limited trench/drill exploration and have widespread gold in soil and stream samples. The Kavola East and Koibua mineralisation may be part of the same semi-continuous zone and jointly could represent major gold potential.

Normanby Gold Property (100% NGG)

NGG's business plan proposes that a gold mine be developed at Imwauna in 2006, subject to completion of a satisfactory feasibility study, and receipt of government approvals. As a part of this feasibility, and to allow an updated resource to be calculated, a comprehensive diamond core drilling program commenced in October 2004. In addition, this drilling will test depth and lateral extensions of the gold mineralisation and previously untested parts of the system.

The initial 17 holes of the present program completed to early December 2004, have confirmed that the high gold grades in the trenches consistently extend to depth. The gold is not significantly enriched at surface. Some holes intersected several zones of mineralisation, and several holes failed to intersect the target zone, probably due to offset faulting or inadvertent early hole termination. Drilling was suspended over the Christmas period but resumed on the 28th January 2005.

An initial analysis of the first drilling results, which should be treated with caution until drilling is completed over the entire Imwauna system, suggests that the open pittable, mineable mineralisation, at a 1g/t cut off, averages 6.02g/t gold over a possible mining width of 3.55m. This grade is comparable to the 6.1g/t gold grade of the inferred resource quoted above but the width is significantly wider than the average width of 2.5m in the resource calculation.
If a 5g/t gold cut off is assumed, the average grade rises to 15.53g/t over an average width of 1.5m. This grade would be an attractive underground mining grade after the open pit has been depleted.

Some of the initial drill results are as follows:

Complete results are shown in the Press Release dated 3rd February 2005. Detailed drilling has been completed to date on only 175m of the trenched, 1240m strike length of the system and will continue for several months. Further drill results were pending as at 13th April 2005.

The present drilling extends the wide spaced drilling (18 holes) at Imwauna in 1996 which had best results such as:

As stated above, NGG's business plan envisages the development of three gold mines over the next three years. Sinivit Mine is expected to be producing gold at the rate of 40,000ozs gold/year by later in 2005. The Imwauna prospect is planned as a second mine to commence production late in 2006 or 2007.

The Imwauna Vein Swarm is a zone of epithermal quartz/gold veins, with some interspersed, disseminated gold mineralisation, that occurs within a northerly trending structural zone which varies from 500 to 1000m in width and has a defined strike length of approximately 3,500m.

The potentially gold bearing area is outlined by both gold in soils and mapped gold bearing quartz veins. For more information on the possible total size of the system see maps in project descriptions and presentation at www.newguineagold.ca

At the northern end of the property, at the Knob Prospect, gold occurs in disseminations in volcanics with trench results such as 320m @ 0.5g/t gold.

The previous and present drilling programs will test less than 20% of the potential gold bearing area and the total gold potential of this system is regarded as very large.

In 1996 NGG reported (News Release, 31 October 1996) an inferred resource at Imwauna of 990,000t @ 6.1g/t gold and 12g/t silver. This resource was based on 17 drill holes over a strike length of 950m (strike length now known to exceed 1240m).

Although this resource is JORC code and Australian Stock Exchange compliant, it was calculated prior to existing N.I. 43-101 requirements. This resource is thus dated, does not meet the requirements of N.I. 43-101, and should be considered to be exploration information only.

NGG reactivated exploration at Imwauna in 2002, initially on a low key basis. A trial mining operation was completed which yielded geotechnical information for a possible open pit mining operation, a large (approximately 100t) bulk sample to check near surface gold grades and to provide samples for metallurgical testing. The bulk sample averaged 14.1g/t gold over a 2.2m mined width, comparable with results from small surface samples and adjacent drill hole results.

Subsequently, in 2003 and 2004, 2040kg of bulk samples were collected from 38 excavator trenches and outcrops over a 1240m strike length of the Imwauna vein system. These bulk samples indicated that, over an average 1m width (for the entire 1240m strike length), the high grade central core of the trenched zone, the average gold content was 26.4g/t. This bulk sampling did not test for lower grade hanging/footwall or intervein gold mineralisation.

Sehulea Gold Property (100% NGG)

Two drill holes to test for a northwestern extension of gold mineralisation at the Weioko Prospect, Sehulea Property, Papua New Guinea intersected gold grades of up to 23.5g/t, within a 14m intersection of 4.56g/t gold.The Weioko prospect is owned 100% by New Guinea Gold Corporation and has an inferred resource of 84,000 ozs gold equivalent, or 1.7 million tonnes at 1.36g/t gold and 12.3g/t silver. Subject to the completion of additional drilling, and a feasibility study, this prospect is scheduled for development in 2007/2008.Previous trench results at the northern end of the prospect have given high grade gold results at surface such as 16m of 20.3g/t gold, suggesting that high grade structures occur within the overall, lower grade, bulk mineable gold resource.

Two short drill holes targeted this concept and were successful in intersecting significantly higher gold grades than the resource average grade. Hole WEH 031, total depth of 64.8m, intersected 21m of 3.59g/t gold from a shallow depth of 7m to 28m downhole. Within this intersection a high grade structure containing 4m of 11.55g/t gold, including 1m of 23.5g/t gold was encountered. Hole WEH 30 intersected more typical Weioko grades including a 51m intersection from 3m below surface to 54m downhole of 1.33g/t gold. This intersection contained several higher grade intervals including 6m at 2.44g/t gold, and 4m at 3.68g/t gold (with a high value of 6.81g/t gold). These results are very encouraging and, with further drilling in 2005, should lead to an upgrading of the resource for this prospect. In addition the southern and depth extent of mineralisation have not yet been closed off.

Several other prospects with significant gold at surface occur within a few kilometres of Weioko and have yet to be drilled.

Allemata Property (50% NGG)

Two excavator trenching/geochemical programs were completed at Allemata in 2004. The earlier field work resulted in the definition of high grade gold in trench such as a 4m width of 100g/t gold, and wide zones of anomalous gold in soils (200m wide zone of 1.24g/t gold including a 50m wide zone of 4.54g/t gold). The results were described in detail in a press release dated 10th June 2004.

A second program at the Ulo Ulo Prospect integrated with previously announced results, defined two parallel structural zones, each of which contains extensive gold mineralisation with numerous narrow high-grade gold lodes (1 to 100g/t gold) plus inter-vein lower grade material (0.1 to 1g/t gold). These east-west trending zones have each, to date, been defined over strike lengths of up to 400m and widths of approximately 100m.

Previous reported trench results from these high-grade lodes included: 1.4m @ 71.9g/t gold (within a 4m wide zone of 18.7g/t gold) and 4m @ 100g/t gold.

Economic mineralisation could occur at Ulo Ulo and other prospects in the Allemata property as either:

Drill targets have been defined to allow these concepts to be tested commencing in May 2005.

Placer Dome's Misima Mine, which is SE, along trend from Allemata, was originally mined as a series of high grade quartz/quartz carbonate/gold veins and later, in the late 1980's, developed as a major, low cost, bulk mining operation.

It should be noted that Ulo Ulo is only one of several similar gold bearing systems at Allemata.

The two east-west trending mineralised zones referred to in the first paragraph are known as Ulo Ulo North, and Ulo Ulo South, and occur within locally pervasively argillised gabbro. Pre second world war underground mining of high-grade mineralisation accessed several lodes in the Ulo Ulo North zone but mining was terminated by the war.

Trenches in the Ulo Ulo North zone have, in addition to previously reported mineralisation, exposed several distinct groupings of lodes, but undoubtedly others exist within this east-west zone:

The strike of individual lodes within the Ulo Ulo North Zone vary widely within the overall east-west trend, suggesting that they may form an anastomosing network.

Widespread lower grade mineralisation occurs between the main veins and the tenor of this mineralisation still has to be assessed. The Ulo Ulo North zone has not been drill tested.

The Ulo Ulo South lodes, as so far noted, vary up to about 1m in width. A sample from a 1m lode returned 14.4g/t gold. A 20cm wide lode returned 16.2g/t gold and several narrow (<10cm) lodes returned values ranging from 1.38 - 10.8g/t gold.

Surface trenching and mapping at Kiayahedebadeba Creek Prospect has located clay-silica-sulphide lodes similar to those at Ulo Ulo. Re-sampling of lodes exposed in trenches excavated by earlier explorers returned grades up to 10.45g/t gold. Similar lodes sampled in outcrop in Kiayahedebadeba Creek returned encouraging intervals including 1m @ 2.96g/t gold, 7m @ 1.43g/t gold including 2m @ 4g/t gold.

Drilling to assess the bulk mining (open pit) and/or high grade individual lode potential within the Ulo Ulo North Zone is expected to commence in May 2005. At the same time, as the drilling is progressing, further drill targets are expected to be defined elsewhere at Ulo Ulo and other prospects such as Haluba (see below) and Kiayahedebabeba Creek.

Feni Gold Property (NGG 50% - Vangold earning 75%)

An initial drilling program was completed at this property by Vangold in August 2004. This program was described in a Press Release dated 16th August 2004.

The initial exploration program at the Feni Property, including approximately 1513 metres of core drilling in 6 holes, yielded encouraging results which will require follow up exploration but did not define significant volumes of potentially economic gold mineralisation.

The surface geochemical stream sampling undertaken earlier this year showed that a large part of the Central Caldera feature has anomalous to high value gold in streams from pan concentrate samples. This gold appears to be derived from throughout the caldera suggesting that most of the bedrock in the 6 sq kms area of the caldera contains gold mineralisation. The drill holes completed by Vangold, however, intersected only wide zones of lower tenor gold and gold/copper mineralisation. Best results from the program were 48m of 1.54g/t gold including 4m of 2.30g/t gold, and 18m of 0.68% copper with 0.72 g/t gold.

The drilling and geochemical sampling program confirmed that the Feni property remains prospective for gold and gold/copper deposits, and is essentially unexplored in terms of drill testing. Gold in pan concentrates range up to 120g/t in the southern caldera region and 86g/t in the northern caldera region.

The limited diamond core drilling carried out by Vangold and previous explorers, mainly in the southern part of the Caldera has shown that gold is also widespread in the bedrock in concentrations of up to 2g/t, often with associated copper in the range of 0.1% to 1.0% copper. Significant intervals of copper mineralisation with significant gold assayed up to 1% to 2% copper.

The exploration problem confronting mineral exploration at Feni is that the bedrock is covered by a variable but, sometimes thick volcanic ash cover, which obscures the bedrock. The stream geochemistry indicates that gold is present throughout the caldera beneath the volcanic ash but it is not a reliable guide to any areas of higher grade gold mineralisation in the bedrock. The exploration problem is how to identify drill targets or structural feeder zones containing higher grade gold mineralisation similar to those at the Lihir gold mine. It is difficult to "see through" the volcanic ash with conventional exploration methods and to site drill holes on a grid or pattern basis, although probably effective, would be extremely expensive.

All data collected over the past year, geochemical, drilling, geophysical, and structural information from terrain radar, will now be re-evaluated to attempt to define higher grade gold and gold/copper targets before a further drilling program is proposed.

On March 17th 2005 NGG announced that it had amended the terms of the Option/Joint Venture Agreement with Vangold Resources Ltd.("Vangold") in respect of the Feni Island Property. The Feni Islands Project (Tenement Licenses EL 1021 and EL 1331 ("The Tenements") has a total area of 166.6 sq kms and includes both Ambitle and Babase Islands that comprise the Feni Islands ("Feni").

To date, Vangold has paid approximately $1,140,000 in exploration costs on Feni. To complete the earn-in to the 50% level, Vangold has agreed to immediately pay $50,000 to the Company and issue 200,000 common shares of Vangold. Vangold's total expenditures prior to December 31, 2006, will be $2,500,000 with the next $50,000 tranche due by June 30, 2005 together with the issuance of a final 200,000 shares of Vangold (for a total share issuance of 800,000). Meeting these terms will earn Vangold an additional 25% in Feni which, at that point, would amount to a total 75% interest in the tenements.

Bismarck Gold Property (50% NGG)

A hand trenching program at the Awale Prospect, Bismarck Property, Papua New Guinea returned wide intervals of gold mineralisation such as 112m @ 0.46g/t gold with narrower higher grade intervals such as 4m @ 2.10g/t gold, 4m @ 1.26g/t gold and 16m @ 1.14g/t gold. In addition rock samples collected from creek drainages contained up to 13.85g/t gold. Complete results are shown at www.newguineagold.ca

The Awale prospect had widespread gold in soil of approximately the same tenor as the trench results. Senior geological staff will visit the prospect in the near future to assess whether or not the gold in the trenches may be leached, i.e. depleted from the surface zone. If the gold is depleted, we could expect better grades could be expected at depth.

There are numerous other prospects within the Bismarck Property such as Tekim and Semben. At Semben previous trench results gave 3m of 156g/t gold, 4.5m of 23.5g/t gold and 2m of 17.0g/t gold. At Tekim trenching returned 26m of 6.99g/t gold and 25m of 4.83g/t gold. These prospects will be assessed during 2005.Pannable gold was traced to a large (50mx50m) oxidised breccia outcrop. This was mapped and sampled in detail. Fine alluvial gold is present in virtually all creeks draining the area covered by trenches.

The Bismarck Property is held by Kanon Resources Ltd, a Papua New Guinea company, owned 50% by New Guinea Gold Corporation and 50% by Vangold Resources Ltd.

Simuku Copper/Molybdenum Property (NGG - 90%)

The Simuku porphyry is a very large copper/molybdenum porphyry system in West New Britain province, Papua New Guinea. Access and logistics are good.

Recent large increases in the price of molybdenum, and to a lesser extent copper, have substantially enhanced the possible economic development of the Simuku Project. NGG owns 90% of the project which is regarded as a major asset for NGG.

The main points in regard to the Simuku Project are summarised below:

Substantial bulldozer trenching was completed in 2004 and further trenching is now in progress, prior to drill testing in the second half of 2005. Two long trenches, totaling 3400m in length were completed in 2004.

Trench one, of total length 1670m, traversed the central/southern part of the porphyry copper system (see Press Release dated 29^th October 2003 for additional detail of Simuku). The mineralogy of the copper and molybdenum mineralisation (substantial jarosite and hematite alteration) over much of the trench suggests significant leaching of copper minerals from the surface environment which could lead to the formation of a subsurface enriched copper zone.

Significant copper and molybdenum occurs over most of the trenched area with results such as 165m of 0.184% copper and 25ppm molybdenum, 30m of 0.223% copper, 72m of 0.073% copper and 241ppm molybdenum, 24m of 0.34% copper and 37ppm molybdenum. The 72m length of 241ppm molybdenum is regarded as particularly significant and re-assaying of part of this zone by the XRF method suggests that the molybdenum results above are understated by between 5 and 25%. Check assaying by XRF suggests the molybdenum results are understated by between 10 and 30%.

Trench 2 results are considered excellent for surface samples, particularly in view of the current geological interpretation of the prospect that there has been substantial leaching of copper minerals from the surface environment. We would expect substantially higher grades at depth within a secondary enriched chalcocite (copper) "blanket". NGG believes that potential exists to define two styles of mineralisation at Simuku. near surface secondary enriched copper mineralisation consisting primarily of chalcocite with copper grades of 0.5% to 1.0% copper.

The highest value part of the copper in soil anomaly is to the south of Trench 2 and will be trenched in 2005.NGG has acquired an excavator and bulldozer specifically for the Simuku project.

MT NAKRU (Effective 75% NGG)

No results have yet been received from the bulldozer trenching program at present in progress.

YUP RIVER (NGG 50%)

An assessment program of the Yup River property commenced in February 2005.

The Yup River property (378.5 sq kms) covers the historic Amanab goldfield in North West Papua New Guinea. There are at least 10 separate and defined areas of gold mineralisation within the property. NGG and Vangold have not targeted this property for field evaluation in 2004 due to a lack of suitable exploration personnel and although the probability of Yup River yielding a major gold resource is considered excellent, there are, as yet no defined drill targets.The present program, which commenced in February 2005, should lead to drilling targets later in 2005.
NGG and Vangold have compiled and assessed all previous exploration data. The main points are as follows:

The data assessment by NGG and Vangold has been summarised by independent qualified person, Peter Swiriduik, as quoted below.

His report and the figures referred to below can be accessed at www.newguineagold.ca

"Historical stream samples compiled and digitized by Terra Search for a World Bank program in Papua New Guinea were statistically analysed and interpreted for gold. A total of thirteen stream sediment drainage anomalies (>0.1g/t gold) were outlined (Figure 3).

The Amanab stream anomalies are divided into four coherent zones draining off specific topography and include Amanab, Aurump, Wofneri and Oweniak. Stream sediment results up to 106g/t gold at Aurump and numerous results greater than 1.0g/t gold define these anomalies. Pan concentrate results to 58g/t gold occur at Wofneri, with greater than 8g/t gold within the Aurump and Amanab stream anomalies.

A compilation and analysis of historical data has included the analysis of soil sampling completed at the Oweniak prospect by Carpenter Pacific Resources N.L. (Figure 4). Some anomalous soil gold values above 0.1g/t gold are evident.

Three stream anomalies at Biaka occur as coherent zones draining from specific topography (Figure 3) -Stream -80# results include 91g/t gold at Biaka "A", 42.7g/t gold at Biaka "B" and 184 g/t gold at Biaka "C".

Anomalous rock chip results of 2.85 and 1.38g/t gold were recorded from completely weathered schist in this area.

The Yumor anomaly is located in the northern part of the tenement near the village Yumor No2. The anomaly was defined from reconnaissance stream sediment results of 4.7 and 7.5g/t gold during the 1988 Carpenter Pacific Resources N.L. exploration program. Carpenter reported that gold is shedding from an east-northeast trending ridge north of the villages of Akraminag and Yumor No.2 and is persistent over six kilometres. The Arkaminag stream anomaly is defined by a 3.39g/t gold stream sediment sample.

The Mouri stream sediment anomaly, 5km east of Oweniak (Figure 3,) is defined by both -80# stream sediment samples (3.09g/t gold) and panned concentrate samples anomalous up to 13.68g/t gold. Other lower value stream anomalies have been defined near the villages of Merewe, Luri and Kambriap.

Airborne magnetic and radiometrics images have been re-compiled with ER Mapper imagery software and an evaluation of this data will be completed by consultant Peter Swiridiuk.

Crater Mountain (NGG 100%, Celtic Minerals & Triple Plate Junction earning 75%)

Drill testing at Crater Mountain by joint venture partners Celtic Minerals & Triple Plate Junction commenced in March 2005.

In the 1990's, seven diamond drill holes were completed on the Nevera prospect by BHP and Macmin (PNG) Ltd., with the best results from hole 2 which returned 115m at 1.83 g/t gold with the hole terminated while still in gold mineralization and hole 5 which returned 24m at 6.55 g/t gold also ending while still in gold mineralization. In Dec 2003, trenching by NGG, approximately 500m west of hole 2 returned an extremely encouraging interval of 48m @ 9.97 g/t gold (including 4m of 50.4 g/t gold and 4m of 41.6 g/t gold) in one trench and 20m of 1.23 g/t gold in a further trench. The Nevera prospect is one of five areas of interest identified in the Crater Mountain structural corridor.

Regionally, the drilling and trenching is contained within a 5km by 2km region of epithermal alteration containing sulphide and gold mineralization with intense silica, argillic and carbonate alteration. Early hand dug trenches returned gold values of 35m at 3.1 g/t and 54m at 1.21 g/t, but trenching has been hampered by three to six metres of recent volcanic ash cover that blankets the area. Rich supergene gold is being won from small workings by local artisanal miners.

The joint venture has compiled all existing data at Crater Mountain including the re-processing and re-interpretation of airborne and ground magnetic data, geochemical data, and landsat structural and lithological data. This work together with new geological mapping and sampling has identified four highly prospective targets within the Nevera prospect area. The work has demonstrated the presence of significant mineralization, with gold values over a wide area.

The joint venture also commissioned geological consultants Sinclair Knight Merz (SKM) to examine a suite of rocks taken from the Nevera prospect. SKM has reported that the rocks comprising dacites, sediments, intrusives, hydrothermal breccias and a diatreme breccia, reveal similarities between Crater Mountain and the world-class Porgera deposit of similar geological age (Porgera's production to date and remaining reserves total approximately 20 Moz of gold). SKM also reports that the presence of advanced argillic alteration offers further possibilities of porphyry or high sulphidation epithermal mineralization, while a diatreme may correlate with epithermal mineralization.

Crater Mountain is one of a number of Pliocene to Quaternary strata-volcanoes that lie in the tectonically active New Guinea Mobile Belt. The Mobile Belt hosts several world-class gold-copper deposits including Ok Tedi, Porgera, Hidden Valley and Wafi, and the underground vein gold deposits of Kainantu and Tolukuma.

Terms of Joint Venture

Under the terms of the NGG-Celtic joint venture, Celtic will earn a 51% interest in the concession by completing work programs totaling CDN $2.0 million within a three year period ending March, 2007 and the right to acquire an additional 24% interest in the concession by incurring further expenditures of CND$2.0 million within a five year period ending March, 2009. This time schedule can be accelerated. Should all terms of the agreement be executed Celtic would own a 75% interest in the concession at the end of term. AIM listed, Triple Plate Junction (TPJ) has a separate agreement with Celtic whereby TPJ can earn 68% of Celtic's interest by funding an aggregate of CDN $ 1.0 million of exploration expenditures by December 31, 2005. Should Celtic and TPJ attain a vested interest, the JV would be held by TPJ (51%), NGG (25%) and Celtic (24%).

The Crater Mountain joint venture project covers 713 sq. km of exploration licences and TPJ is the operator of the joint venture.

EXPLORATION UPDATE