Fifth annual report for EL 7294 'Borroloola', for the period 30/10/2004 to 29/10/2005

Abstract

Exploration Licence 7294 'Borroloola' covers an area of 250.6 km2 within the McArthur Basin near the Gulf of Carpentaria, NT, adjacent to the northern extension of the Emu Fault. Ashton Mining Ltd was granted the lease on 30th October 2000 for a period of six years. Previous drilling by Rio Tinto Exploration (RTE) confirmed that a small sub-basin adjacent to the Emu Fault contained Middle Proterozoic carbonaceous pyritic siltstones prospective for stratabound sedimentary-hosted Zn-Pb mineralisation. A review in 2002 by RTE of its base metal projects in the McArthur Basin resulted in the decision to divest EL 7294. The divestment of EL 7294 was progressed during the reporting period with Anglo American Exploration (Australia) Pty Ltd agreeing to a joint venture on the tenement in late September. The Batten Trough Farm In and Joint Venture Agreement was entered into between Rio Tinto Exploration Pty Ltd (North Mining Limited and other Rio Tinto companies) and Anglo American Exploration (Australia) Pty Ltd in 2003. This Agreement was signed on 29 September 2003 and it has been lodged with the Department for registration. Under this Agreement, Anglo American Exploration (Australia) Pty Ltd is carrying out work on the licenses covered by the agreement. They now form part of a regional exploration project that Anglo American Exploration (Australia) Pty Ltd is undertaking in Joint Venture with Rio Tinto Exploration Pty Ltd (North Mining Limited) within the McArthur Basin. The other leases within the Project include EL 10103, EL 10316, EL 10317, EL 10329 and EL 23676. The exploration target is sediment hosted massive sulphide Zn-Pb deposits of the HYC type. Rio Tinto Exploration's previous exploration results in the area had confirmed the favourable geological setting and Zn-Pb prospectivity of the Batten Fault zone. The fault zone remains a quality 'grassroots' exploration target that Anglo American Exploration (Australia) Pty Ltd is testing as part of their larger Batten Trough Project. Due to a re-evaluation of company exploration priorities and rationalization of the Batten Trough Project leases a significant proportion of EL 7294 was selected for relinquishment from 30th October 2004. No fieldwork was conducted during the fifth year of the lease, as exploration efforts, including drilling, were concentrated on other leases within the Batten Trough Project. Future work will be contingent on results of exploration activities from other leases in the Project.