Mount Peake Project Annual report 22 July 2008 to 21 July 2009 EL 23074

Abstract

During the report period TNG completed a 6 hole, 928m Reverse Circulation (RC) drilling program at its Mount Peake vanadium project confirming that the strike length of the magnetite mineralisation is over 1300m and open in all directions. The consistent mineralisation with intersections of up to 165m indicated significant potential for a substantial resource. Initial metallurgical work confirmed the extraction of a vanadium concentrate. The company appointed Snowden Mining consultants who confirmed a JORC inferred resource estimate of 107 million tonnes at 0.32% V2O5, 5.9% TiO2, 29% Fe (cut-off 0.1% V2O5). Snowden also completed an Initial Scoping Study and considered the viability of an open pit mining operation. Despite the high capital cost the results demonstrated viable project economics given the parameters and assumptions of this initial study. Further drilling at Mount Peake will commence in September 2009 as part of an NT Government funded drilling grant, awarded to TNG to identify if the Mount Peake intrusion is a large layered mafic system with massive sulphide potential. TNG plans to drill two deep diamond drill holes of 500m each to confirm the nature of the intrusion and test the prospectivity for Ni-Cu sulphides and PGM's. Ten RC drill holes are planned to infill to a 200 x 200m square grid across the central area of the modelled vanadium deposit to further improve confidence in the resource. Metallurgical work is continuing to optimise V205 recoveries and grade.