The results are from a regional pan concentrate geochemistry sampling program begun in late 2015 to identify potential resource targets in an area of sub-cropping volcanic host rocks within trucking distance of the plant site proposed in the projects' feasibility study.

Kula management believes a follow up trenching program to extend the mineral resource is warranted.

The pan concentrate program was of 261 samples taken over 16sq.km in the southern portion of the Okiduse Range.

The feasibility study completed in September 2012 defined a resource of 19.7 million tonnes at 2.45 grams per tonne gold, at a cut-off grade of 1 gram per tonne gold, for 1.5 million ounces with an ore reserve of 766,000oz based on a gold price of $US1200/oz ($A1605).

Operating cash costs for the project is $730p/oz.

Woodlark Island has a mine life of nine years based around three open pit mines processing gold through a 1.8 million tonnes per annum gravity and carbon in leach plant.

Kula held cash of $1.1 million as of December 31 2015.

The company share price fell 3% to end the day at A3.2c.