Gypsum in economic quantities and grades has been discovered in two swamps located close to the Princes Highway near Ashville, about 135 km south-east by road from Adelaide. The two deposits, designated Warnes and Lihou, were discovered in 1991 by Olliver Geological Serivces Pty Ltd during investigations on Exploration Licence 1628. Currently, mineral tenure is held as Mineral Claims 2664, 2665 and 2666 over Warnes, due to expire in March 1993, and Mineral Claim 2687 over Lihou, due to expire in April 1993. Push tube and hand auger drilling has outlined in-place reserves of 4.4 million tonnes at Warnes and 1.7 million tonnes at Lihou, with average grades of raw gypsum of 82.4% and 67.4% respectively. The main contaminants are calcium/magnesium carbonate and salt. The gypsum sediment profile extends downwards virtually from the lake surfaces, being overlain in places by an algal mat only a few centimetres thick. As the gypsum is unconsolidated, the deposits would be suitable either for seasonal open-cut mining or a year round dredging operation. The high-grade centre of the Warnes deposit is expected to produce washed salt-free material with 92% gypsum content, eminently suitable for plaster manufacture. The deposits are considered to be economic for the following reasons: (a) Suitable tonnages and grades. (b) Ease of mining. (c) Proximity to Adelaide and ports with road and rail links to Eastern Australian population centres. (d) Dwindling reserves at other traditional South Australian gypsum sources. These gypsum deposits are a significant addition to the industrial mineral inventory of South Australia.