Annual and final report for EL 23906 'Borroloola West', reporting period 9th February 2005 to 8th February 2006

Abstract

Exploration License (EL) 23906 is located along the coastal plains of the southwestern Gulf of Carpentaria region of the Northern Territory, near the town of Borroloola. The EL was granted to Conarco Minerals Pty Ltd (Conarco) on 9 February 2004 for a period of six years, in conjunction with adjacent EL 23904. Following granting of the ELs, Conarco invited Core Coal (NT) Pty Ltd and Jandale Holdings Pty Ltd to farm-in to the project, and to manage and undertake an exploration program within the tenements. The area came to the attention Conarco during 2002 based on a driller's report of coal being intersected in a 1992 water bore, located near Manangoora Station, about 60km east of Borroloola. Subsequent laboratory examination of the original water bore samples obtained by Conarco suggested that the material was coal, although its rank was uncertain. Based largely on geophysical evidence, targets were selected that were interpreted to represent possible local basins that may host coal-bearing sequences within Mesozoic sediments beneath recent cover. During the second year of tenure, the following work was undertaken on behalf of the JV: - Additional open-file data reviews and interpretation of the available open-file data; - Designed and executed a follow-up exploration program to test a selection of targets identified from the data analysis as worthy for drill testing. - Completed site clearance and landholder access procedures in order to undertake and facilitate the drilling program. - Completed a drilling program comprising two RC drillholes totaling 74m. Because of drilling difficulties, it was not possible to test the main exploration target to the extent planned. Consequently, no carbonaceous intervals were intersected in the drillholes in EL 23906, although the depth of drilling was very limited. However, the potential for a significant coal occurrence in this area has been downgraded, based on the results of the drilling program in the adjacent EL 23904. This work confirmed the presence of a grey / black sedimentary horizon in the vicinity of the water bore reported to have intersected coal, but analysis of the black sediments indicated they had low total carbon content, and did not represent a coal horizon or target of economic interest. In summary, an adequate test was carried out for the presence of coal in Mesozoic formations at Manangoora and surrounding area, with no indications that coal has the potential to be found in commercial quantities and qualities in this area. As a consequence of the results of this exploration program, the prospectivity for coal has therefore been downgraded in the area, and EL 23906 was recommended for relinquishment.